The Soaring Costs of GLP-1 Agonists: Navigating Employee Health and Employer Expenses in 2024 and Beyond

With the soaring cost of GLP-1s creating significant financial strain, employers are grappling with the challenge of managing these rising expenses while maintaining comprehensive health benefits for their workforce. 

This issue is at the forefront of current healthcare concerns, prompting a deeper examination of how organizations can effectively balance cost control with employee well-being.

Springbuk recently released our mid-year update to the 2024 Employee Health Trends report, providing crucial insights into the evolving landscape of employee health and employer costs.

Need a copy of the 2024 Employee Health Trends Mid-year Update? Click here to download.

Through this mid-year update, we shed light on several key areas:

• The unfolding of costs in the second half of 2023
• Shifts in conditions driving high-cost claimants
• Specialty drugs driving Rx costs
• The impact of GLP-1 costs on overall drug spend

Below, you'll find highlights and takeaways on GLP-1 trends from the mid-year update.

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Defining the Core Challenge

GLP-1 agonists have emerged as a significant driver of prescription drug spending, with diabetes and obesity among the top contributors. Three of the top five drugs driving the net change in costs per member per month (PMPM) were GLP-1 agonists.

Key Insight: The contribution to total spend on GLP-1s for members with obesity without a diabetes diagnosis has grown significantly, now constituting almost 16.5% of spend on these drugs compared to 11% in 2022 and just 4% in 2020.

The Rising Tide of GLP-1 Costs

GLP-1 spending has dramatically increased in recent years. Between 2022 and 2023, it increased by more than $6.70 PMPM. 

Even more strikingly, since 2020, total GLP-1 spending has increased by almost $13 PMPM.

Key Insight: The total GLP-1 spend per member per month has more than tripled from $5.29 in 2020 to $18.27 in 2023, indicating a rapid and significant shift in healthcare spending patterns.

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Obesity Treatment: A New Frontier

Obesity is a well-established risk factor for numerous chronic conditions, and GLP-1 agonists are emerging as potential game-changers in combating obesity. However, these treatments come with a high price tag.

Key Insight: Spend on drug treatment within obesity episodes is over 6 times what it was 3 years ago. About half of the spend in the most recent year is for Wegovy, which is approved for the treatment of obesity.

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Strategies for Managing Costs

To address the rising costs associated with GLP-1 agonists and obesity treatment, employers should consider a comprehensive strategy. 

This could involve:

1. Implementing proactive planning and data-driven strategies to manage costs effectively
2. Identifying population segments at greatest risk of becoming high-cost claimants
3. Exploring partnerships with clinical program providers specializing in identifying pharmacy cost-saving opportunities
4. Adopting a holistic approach to obesity treatment, combining step therapy protocols, lifestyle interventions, and disease management strategies

Key Insight: Springbuk Insights™ allows customers to pinpoint potential savings and areas for program engagement related to obesity. The Springbuk Activate marketplace connects employers with suitable partners to manage obesity through an evidence-based, multifaceted approach.

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Unlocking the Power of Your Health Data

Your health data holds the key to tailored employee benefits and cost optimization. By harnessing these insights, you can craft offerings that cater to your workforce's unique needs while fortifying your organization's financial health.

If you'd like to discuss analytics solutions tailored to distilling insights on GLP-1 usage, obesity treatment, and other high-cost areas across your employee population, click here to connect with a Springbuk team member.

Because in health benefits, like in business, staying ahead of trends determines success.