FACT SHEET: Biden-Harris Administration Takes Latest Step to Lower Prescription Drug Costs by Proposing Expanded Coverage of Anti-Obesity Medications for Americans with Medicare and Medicaid
Today, the Biden-Harris Administration is proposing a new rule to significantly expand coverage of anti-obesity medications for Americans with Medicare and Medicaid. Tens of millions of Americans struggle with obesity. An estimated 42 percent of the U.S. population has obesity, which is now widely recognized as a chronic disease, with increased risk of all-cause mortality and multiple related comorbidities such as diabetes, cardiovascular disease, stroke, some cancers, and more.
Over the past few years, there have been major scientific advancements in the treatment of obesity, with the introduction of new life-saving drugs. These anti-obesity medications can help prevent the development of Type 2 diabetes. Furthermore, these drugs reduce deaths and sickness from heart attack and other cardiovascular outcomes by up to 20%. But for too many Americans, these critical treatments are too expensive and therefore out of reach. Without insurance coverage, these drugs can cost someone as much as $1,000 a month.
Currently, Medicare and Medicaid cover the use of AOM’s for certain conditions, like diabetes. Today’s new proposal would expand access to these innovative medications for obesity, which is widely recognized as a disease and help an estimated 3.4 million Americans with Medicare. Medicare coverage would reduce out-of-pocket costs for these prescription drugs by as much as 95 percent for some enrollees. Approximately 4 million adult Medicaid enrollees would also gain new access to these medications. This proposal would allow Americans and their doctors to determine the best path forward so they can lead healthier lives, without worrying about their ability to cover these drugs out-of-pocket, and ultimately reduce health care costs to our nation.
Since taking office, the President has built on, strengthened, and protected Medicare, Medicaid, and the Affordable Care Act, by signing laws such as the American Rescue Plan Act and the Inflation Reduction Act to lower prescription drug costs and health insurance premiums. The President is proud of the fact that the Inflation Reduction Act allows Medicare to negotiate down the price of drugs, a tool that will help Medicare lower the cost of some of the most expensive medications in the program. That power to negotiate drug prices is critical because Americans pay two to three times more than people in other countries for their prescription drugs. An analysis from the Department of Health and Human Services (HHS) finds international prices for anti-obesity medications are much lower than U.S. list prices and generally lower than U.S. net prices for these same medications. It’s unacceptable that Americans – especially those without insurance coverage for these drugs — are forced to pay so much more for life-saving medications. The proposed rule would be implemented at the same time as a comprehensive agenda to lower the costs of drugs, including the drug price negotiation program and increased market competition. We can lower drug prices and improve health outcomes for Americans.
Thanks to the President’s efforts, seniors are already seeing lower prescription drug costs with insulin capped at $35, free vaccines, and out-of-pocket costs for prescription drugs capped at $2,000 starting in 2025. Already this year, nearly 1.5 million people with Medicare Part D saved nearly $1 billion in out-of-pocket prescription drugs costs in the first half of 2024 because of the Biden-Harris Administration’s Inflation Reduction Act. Furthermore, HHS has reached agreement with drug manufacturers for the first ten negotiated drugs, with new prices that are reduced between 38 to 79 percent starting in 2026.
The President’s new actions are all in addition to an already impressive track record on fighting for the health care of Americans across the nation. The Biden-Harris Administration’s National Strategy on Hunger, Nutrition, and Health focused on ending hunger and reducing diet-related diseases such as obesity. One of the Strategy’s pillars is integrating nutrition and health, which recognizes the opportunities within Medicare and Medicaid to support beneficiaries’ access to nutritious foods, obesity counseling, and other nutrition-related services. Obesity is a multi-faceted disease and we need to work on all levels from prevention to treatment to address this persistent challenge.
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