A Practical Framework for Managing GLP-1 Costs in Your Pharmacy Benefit

GLP-1 drugs aren’t just something new or interesting anymore, instead they have become a real cost that benefit leaders have to plan for.

By the end of 2025, these medications had turned into one of the biggest drivers of pharmacy spending for many self-funded plans, often costing more overall than even traditional specialty drugs. Drugs like Wegovy, Zepbound, Ozempic, and newer options coming to market have noticeably changed what monthly claims reports look like.

If you’re a benefits manager or HR leader trying to decide how to handle this, you’re definitely not alone, and there usually isn’t a simple yes-or-no answer.

The Cost Reality

A single GLP-1 prescription can cost about $900 to $1,400 per month before any discounts. When 3% to 8% of employees use these medications, the total yearly cost can quickly reach millions for mid-sized employers. Companies that didn’t make any changes in 2024 are now seeing their pharmacy costs jump by roughly 18% to 35% year over year, with GLP-1 use driving most of that increase.

The need to do something about it is very real, but so is the temptation to make quick, overly broad decisions.

Why Blanket Exclusions Backfire

On the surface, the easiest move is to stop covering GLP-1s for weight loss and only keep them for diabetes. It sounds simple, but it’s usually not the best approach unless it’s part of a bigger strategy.

Here’s why. First, employees notice, and they’re not happy. These drugs are everywhere right now, and for many people they make a real difference. Cutting them off completely tends to create frustration that ends up on HR’s plate. Second, limiting coverage to diabetes only can push providers to code diagnoses differently, which can lead to compliance issues and higher costs. Third, you might miss out on long-term health savings. More and more evidence shows these medications can reduce future heart and metabolic-related costs, so looking at it only from a pharmacy cost angle can be short-sighted.

A better approach is to set up clear rules and tiers, so you can manage costs while still giving people access when it makes sense.

Clinical Criteria That Work

Clear, well-defined rules are the starting point. For weight loss use, what tends to work is setting a BMI requirement that matches the FDA guidelines, showing that the person has already tried lifestyle changes like diet and exercise, and having them participate in a coaching or lifestyle program while on the medication. Some plans also require an added health risk, like prediabetes or high blood pressure, to focus coverage on those who are most likely to benefit.

The point isn’t to make it hard for people to get the medication. It’s to make sure the patient, the doctor, and the plan are all on the same page about what success looks like and how progress will be tracked.

Quantity Limits and Step Therapy

Limits on how much medication is dispensed should follow the official dosing instructions, including the step-by-step increase in dose over time. If plans don’t account for this gradual ramp-up, they can end up paying for higher-dose pens before patients are ready for them, which wastes money and isn’t good clinical practice.

“Try-this-first” rules (step therapy) are a bit more controversial. A reasonable approach is to have patients try lower-cost options, like phentermine or the combination of naltrexone-bupropion, before moving to a GLP-1. That way, you’re not shutting the door, but you are making sure more affordable options are considered first. That said, doctors often push back on these requirements, so they need to make clinical sense. Overly strict rules, like requiring a full year of failed treatments before approval, usually don’t hold up and get overturned anyway.

Vendor and Formulary Leverage

This is where a lot of plans are leaving money on the table. The GLP-1 market is changing fast, drug discounts from manufacturers are getting bigger, new direct pricing deals are popping up, and even compounded versions are floating around in a bit of a gray area. On top of that, many PBMs now offer special GLP-1 programs, usually for an extra fee.

There are a few important questions you should be asking your PBM right now. How much discount (rebate) are you getting on each GLP-1 prescription, and how much of that actually comes back to you? Are they choosing drugs based on the lowest real cost, or just the ones that bring in the biggest rebates? And are there any guarantees tied to weight loss results? If your PBM can’t give you clear answers, that’s a red flag in itself.

For self-funded plans, it may be worth looking at a more independent or competitive PBM setup if your current contract isn’t aligned with your goals. The price differences can be significant, and GLP-1 drugs are often where PBMs can quietly make the most margin without it being obvious.

What To Put In Place This Quarter

If you’re planning for 2026 and want to make a few smart adjustments before renewal, here’s a simple checklist.

First, tighten up your approval rules for GLP-1s, set clear BMI requirements, make sure members are part of a lifestyle or coaching program, and define what’s needed to continue the medication. Next, make sure limits on quantity match the proper step-up dosing schedule. Also, double-check with your PBM how much rebate money you’re actually getting back and whether they’re choosing drugs based on the lowest real cost.

Then, decide if bringing in a lifestyle or coaching program makes sense, and if you do, build it into the approval process instead of running it separately. Lastly, map out what costs could look like over the next three years so leadership has a clear picture of where things are headed under different scenarios.

GLP-1s aren’t going anywhere. The plans handling this best aren’t the ones saying “cover everything” or “cover nothing.” They’re the ones treating it as a strategic decision, balancing cost, clinical outcomes, and employee experience all at the same time.

If you are a benefits manager or employer looking for a second opinion on your current pharmacy benefit structure, lets connect and start a conversation!

By Michael Lee, PharmD

Michael Lee, PharmD, is an independent pharmacy benefits consultant with a managed care background. He provides strategic guidance to optimize pharmacy benefit design and clinical care delivery, with expertise in formulary development, medical policy review, biosimilar strategy, Generic utilization, rebate optimization, and vendor-neutral PBM procurement.