“If something is available to help you to be more healthy, to avoid comorbidities … why would we want to wait till a person became diabetic to help them?” Richardson asked fellow lawmakers during a June legislative hearing.

Her frustration reflects a problem playing out across California, where medications like Ozempic and Wegovy have shown remarkable promise for treating obesity and related conditions but remain financially out of reach for many residents. Prices have edged downward in recent years, but most insurance plans still won’t cover the drugs, and state health programs — worried about ballooning costs — have in some cases pulled back coverage rather than expand it.

Now Richardson is pushing legislation aimed at closing that gap. Senate Bill 1089, which is nearing final approval in Sacramento, would direct the state to pursue a partnership with a drug manufacturer to boost competition and drive down GLP-1 prices through CalRx, California’s program for producing and distributing costly medications at reduced rates.

Any such deal would likely take years to materialize. It took the state three years to bring its $55 insulin product to market through CalRx, which currently also distributes albuterol inhalers and naloxone.

The version of SB 1089 now moving through the Legislature is considerably scaled back from its original form. Earlier drafts would have required CalPERS, which provides health coverage to 1.3 million public employees and retirees, to cover GLP-1 medications outright. CalPERS pushed back hard against that provision, warning it could raise premiums by roughly $28 per member each month.

Richardson said she has since discussed adding GLP-1s to the CalRx program directly with Gov. Gavin Newsom, describing him as “very positively open” to the idea. State health officials have confirmed that GLP-1s are among the medications under consideration for the program.

Spending on the drugs has climbed dramatically in recent years. According to state data, the number of GLP-1 prescriptions issued specifically for weight loss — across both Medi-Cal and private insurance — surged from about 20,000 in 2018 to 700,000 in 2023. That year alone, California spent nearly $417 million on weight-loss GLP-1 prescriptions through Medi-Cal, while commercial insurers spent over $405 million.

A report from the Legislative Analyst’s Office found that overall pharmacy spending in California nearly doubled during that period, driven largely by medications treating diabetes, obesity and inflammatory conditions.

Facing similar cost pressures, California recently eliminated Medi-Cal coverage of GLP-1s when prescribed solely for weight loss, though the drugs remain covered when prescribed for diabetes. The state isn’t alone — New Hampshire, Pennsylvania, Massachusetts and South Carolina have made comparable cuts to their Medicaid programs. Currently, only a dozen states cover GLP-1s for obesity under Medicaid, and Rhode Island is set to end its coverage this October. Coverage under private insurance is similarly inconsistent, with health plans citing GLP-1 costs as a major factor pushing up premiums.

Alison Sexton Ward, an economist and research scientist at the University of Southern California, said the medical benefits of these drugs are well documented, with modeling suggesting long-term savings in health care spending and a reduction in health disparities. But she said insurers face a difficult calculus: the upfront costs are steep, and the savings from preventing obesity-related illness may not materialize until years later — often after a patient has switched insurance providers.

“The thing about treating obesity is just because you lose weight today doesn’t mean that your health care costs go down tomorrow,” Ward said. “There’s been this unique pressure on these drugs that they pay for themselves.”

One model drawing attention from researchers is the federal Medicare GLP-1 Bridge Program, a temporary initiative designed to bring the price of drugs such as Zepbound, Wegovy and Foundayo down to roughly $50 a month.

Dr. Wayne Ho, an obesity specialist and researcher based in Los Angeles, said he sees firsthand how uneven access shapes patient outcomes. Those who can afford the drugs out of pocket, or whose insurance covers them, are often able to manage their conditions far more effectively than patients forced to rely on less effective alternatives.

“It’s really disheartening to see because we have these wonderful innovative treatments that really are life altering,” Ho said.

The high price tag has pushed some patients toward cheaper, compounded versions of the medications — a trend that worries many physicians because those products lack FDA approval. Compounding is typically used to modify a drug for a specific medical need, such as removing an allergen, but a growing number of compounding pharmacies and telehealth platforms are now offering altered versions of GLP-1s that swap out ingredients. Ho warns that these products carry greater risk because they skip the FDA’s standard review process.

Nationally, calls to poison control centers related to weight-loss medications spiked by 1,500% between 2019 and 2025, according to America’s Poison Centers. Research has linked compounded GLP-1s to higher rates of adverse reactions and dosing errors, including a Binghamton University study that found compounded versions were associated with higher hospitalization rates. The FDA has also cautioned about counterfeit products entering the market.

Despite the challenges, Ho remains optimistic that broader, affordable access to FDA-approved GLP-1 medications is within reach, and he credits ongoing legislative efforts with helping move the needle.

“I think there’s more and more pressure to cover these medications as more and more scientific data come out to show how it affects the body in a very positive manner,” he said.

Original source: CalMatters

The post California Lawmakers Push Plan to Cut Costs of GLP-1 Weight-Loss Drugs appeared first on The Hemet & San Jacinto Chronicle.

The bill, carried by Sen. Laura Richardson, an Inglewood Democrat, would create a five-year pilot program requiring health insurers serving public employees to cover treatment for chronic weight management. That coverage would have to include at least one GLP-1 medication, a class of drugs that includes Ozempic and similar treatments. The medications are commonly known for weight loss but also are used to help regulate blood sugar for people with diabetes.

The measure passed the state Senate in May with strong bipartisan backing, reflecting growing interest in expanding access to obesity treatments. But the California Public Employees’ Retirement System, which provides health coverage to about 1.3 million public employees and retirees, is recommending that its board oppose the legislation.

The reason, according to CalPERS, is the potential financial impact.

In a new estimate, CalPERS said the bill would raise premiums by $437.2 million, equal to about $28 per member per month. The system projected the cost to the state general fund would be $187.2 million in the first year, with expenses likely to rise by tens of millions of dollars annually in later years.

CalPERS staff warned that opening broad access to GLP-1 drugs would place major pressure on the health care system because of the large number of people who could qualify. Staff also cited studies from the commercial insurance market indicating that GLP-1 coverage tends to increase overall spending, with drug costs outweighing savings from reduced medical care.

The cost concern could become a major obstacle if the bill reaches Gov. Gavin Newsom. Last year, Newsom persuaded lawmakers to end Medi-Cal coverage for weight-loss drugs, citing the expense to the state.

Supporters of Richardson’s proposal argue that obesity is a serious chronic condition that should be treated like other major health risks. Being overweight or obese is associated with higher rates of heart disease, high blood pressure and some cancers. The American Diabetes Association estimates that about 11 million California adults, or 27%, have obesity. The organization projects that figure could rise to 41% by 2030.

Richardson has pointed to her own experience using Zepbound, another anti-obesity medication. During an April hearing, she said she lost 43 pounds on the drug but had to pay for it without coverage from CalPERS because it was prescribed for weight management rather than diabetes.

She argued that chronic weight issues affect the state’s economy through higher health costs, disability, absenteeism, early death and reduced workforce participation. Richardson questioned why insurers would not cover a treatment that she believes could ultimately reduce costs.

The debate reflects a broader challenge facing California and other states as demand grows for GLP-1 medications. The drugs have been hailed by many patients and doctors as a breakthrough in treating obesity, but their high price has raised difficult questions for public programs and employer-sponsored health plans.

For public employees across California, including workers and retirees in the Inland Empire, the outcome could determine whether weight-loss medications become more widely available through government health plans or remain limited largely to those who can qualify under existing rules or afford to pay out of pocket.

The CalPERS board is expected to vote on its position next week. The bill is scheduled to be heard by the Assembly health committee on June 16.

Original source: CalMatters

The post California Weighs Cost of Ozempic Coverage for Public Employees appeared first on The Hemet & San Jacinto Chronicle.