An employee benefits researcher says that an increasing number of employer-sponsored health insurance plans are covering weight-loss drugs such as Ozempic and Wegovy, a trend that may push up corporate healthcare costs in the short term but is expected to reduce related spending in the long run.

Employer coverage of glucagon-like peptide-1 (GLP-1) drugs—initially used for diabetes patients—is expanding: according to an October release by the Employee Benefit Research Institute (EBRI)report, 55% of employers cover GLP-1 drugs for diabetes, and 36% cover both diabetes and weight-loss uses.

Larger companies are more likely to pay for such medications. According to data from the Peterson Center on Healthcare, a nonprofit advocating for affordable care, and the health policy research organization KFF, this year, among companies with more than 5,000 employees, 43% of the largest plans covered GLP-1 drugs for weight loss, a significant increase from 28% last year.

This growth may create tension between corporate HR and finance teams: CFOs oppose coverage due to costs, while HR believes covering these drugs helps attract potential employees and brings long-term savings. Jake Spiegel, senior research associate at EBRI, said this in an interview.

Concerns over GLP-1 drug handling come as employer-sponsored health insurance costs continue to rise. According to KFF's 2025 annual benchmark health benefits survey, the average employer-covered family insurance premium in 2025 reached $26,993, up 6% from 2024. The survey showed the average out-of-pocket cost was $6,850.

'Band-aid' strategy

Spiegel and his co-authors wrote in an October EBRI paper that GLP-1 drugs, initially used to control blood sugar levels but recently prescribed for weight loss, can have typical monthly prescription costs of up to about$700or more. Whether employers or employees bear or share the cost varies by company, and typical treatment may last several years.

"Some employers may view this as a longer-term game—like ripping off a band-aid, paying a higher price in the short term, but after ten or twenty years, you get a workforce with lower obesity- and overweight-related spending," he said.

Spiegel said the EBRI paper may intensify internal discussions about drug coverage. "There is indeed some tension. I expect this paper will provide some basis for the CFO's arguments, because these drugs are still extremely expensive at present," he said.

'High demand'

KFF President and CEO Drew Altman said in an October 22commentarythat covering these drugs poses a "cost challenge" for companies. "Demand is high, and companies are becoming uneasy about continuing coverage without more restrictions," such as requiring prior authorization for prescriptions, participation in nutrition programs, and weight-loss treatment courses.

Spiegel noted that because few employees currently take these drugs, there is significant potential for corporate healthcare costs to rise. "If employers expand eligibility not only to those with obesity or diabetes but also to those who are simply overweight, the potential market could be very large," Spiegel said.

Currently, according to EBRI data, GLP-1 drug usage is relatively low—a 2024 survey found that only one in eight respondents had taken these drugs—but more than 40% of privately insured adults are "clinically eligible" for these drugs based on diagnoses of diabetes, weight or obesity issues, and other risk factors.