Could Biden Administration’s Proposal To Cover Weight Loss Drugs Lead to ‘Surge in the National Debt’?

The Biden administration’s latest proposal to allow Medicare and Medicaid to cover weight loss drugs such as Ozempic and Wegovy could bring expanded coverage for millions of Americans — and with it, a hefty price tag for taxpayers. The White House says the proposed regulation, announced Tuesday, would help 3.4 million Americans with Medicare and nearly 4 million with Medicare. While the health insurance programs currently cover the use of anti-obesity medications for conditions such as diabetes, the new proposal aims to cover them for obesity as well. “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,” the White House said in a statement on Tuesday, while noting that weight loss drugs can help prevent those diseases. By classifying obesity as a disease, the Biden administration is aiming to get around a decades-old congressional ban barring Medicare from covering weight loss drugs. The White House said that without insurance coverage, the drugs can cost up to $1,000 per month — and that the new proposal would bring out-of-pocket costs down by as much as 95 percent for Medicare and Medicaid enrollees. The Biden administration’s proposal estimates that the coverage will cost the federal government nearly $40 billion in the next decade, with Medicare making up $25 billion of the total cost. Other estimates say the cost would likely be higher: the Congressional Budget Office estimated the federal cost from Medicare alone would be $35 billion from 2026 to 2034. Those who support allowing Medicare to cover weight loss drugs argue that it would generate savings overall by reducing cancer and other diseases. Yet others say that the high costs of the drugs — and widespread demand for them — would cost the government more than it would save. “Relative to the direct costs of the medications, total savings from beneficiaries’ improved health would be small — less than $50 million in 2026 and rising to $1.0 billion in 2034,” the CBO projected in October.In an analysis last year, the CBO noted that at their current prices, the weight loss medications “would cost the federal government more than it would save from reducing other health care spending” and that it would “—lead to an overall increase in the deficit over the next 10 years.” “Medicare spending on new procedures is the single factor most responsible for the projected surge in the national debt over the coming decades,” a senior fellow at Manhattan Institute, Chris Pope, noted on X in response to the Biden administration’s proposal. “Expansions of coverage are made almost entirely without consideration of the additional costs to taxpayers.”“I suspect that the cost of this single executive action will end up exceeding all the savings that DOGE generates put together,” he wrote. In a separate analysis, Mr. Pope argued that “given the breadth of interest in weight loss and the high prices of these pathbreaking drugs, the cost of adding weight-loss-drug coverage to Medicare could be enormous.” With the cost of Medicare expected to soon double the total defense budget, the program’s skyrocketing costs are what’s most responsible for the surge in national debt that’s expected in the coming years, he adds. Little “insurance justification” exists for expanding Medicare to cover weight loss medication, he argues. “The purpose of insurance is to spread the cost of rare adverse events across many policyholders, each with fairly low risks of suffering injury,” he writes, allowing patients to protect themselves from large medical costs at a lower cost. “Pooling risks does little, though, to help make weight-loss drugs more affordable because such drugs are a routine, predictable, and uniform expense associated with a condition that 74 percent of Americans wish to alleviate.”The new proposal will depend on the incoming Trump administration, as the New York Times reported, where its future isn’t clear. President Trump’s nominee to lead the Department of Health and Human Services, Robert F. Kennedy Jr., has expressed support for eating healthy meals to solve the obesity epidemic rather than turning to drugs. The Sun has reached out to Trump’s transition team for comment.

Could Biden Administration’s Proposal To Cover Weight Loss Drugs Lead to ‘Surge in the National Debt’?

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