How far should employees benefits go in funding expensive diabetes and obesity drugs that may need to be taken for years?
A major new cardiovascular study on glucagon-like peptide 1 receptor agonists (GLP-1 RAs) is sharpening an already fraught question for Canadian employers: How far should group benefits go in funding expensive diabetes and obesity drugs that may need to be taken for years?
Researchers using U.S. Veterans Affairs data found that adults with type 2 diabetes who stayed on GLP-1 drugs for three years had the greatest reduction in heart attack, stroke or death compared with those on sulfonylureas, an older class of medication, and that “even brief periods of discontinuations or interruptions might progressively erode and could ultimately reverse this protection.”
A Reuters Health summary of the same work reported that patients who remained on GLP-1s continuously saw an 18 percent reduction in cardiovascular risk versus sulfonylureas, while stopping for as little as six months raised risk by four percent and two years off treatment raised risk by 22 percent, compared with continuous use.
How GLP-1 data collides with current plan design
The new evidence lands in a benefits environment that was already struggling to absorb GLP-1 costs. Pascale Mapleston, CEO of the Benefit Code, says most Canadian plans have coverage, but only within tight limits: “That's because the impacts on claims experience and cost for employers were so dramatic when Ozempic hit the market. It was like night and day.”
Faced with that kind of shock, carriers moved quickly to add prior authorization criteria, caps and exclusions, and many employers accepted those changes as necessary guardrails.
“I think a lot of the rules came in because individuals were being prescribed a diabetic drug for weight loss,” Mapleston adds,
“So the carriers were saying, ‘You don't have the therapeutic reason to get prescribed this drug? It's not going to be covered.’”
Obesity coverage, risk and the shifting employer philosophy
Beyond diabetes, GLP1 drugs are forcing a much broader conversation about obesity, chronic disease and the employer’s role in funding long-term care. Mapleston says the drugs have also changed how insurers and employers think about obesity itself.
“The problem with these drugs is it changed the landscape of how you treat diabetes and, in particular, weight loss,” she says.
“Obesity is a huge driver of medical conditions in Canada. So from that perspective, should employers or insurance carriers pay for obesity drugs? Some say ‘yes’, and some say ‘no’.”
For HR professionals, obesity is no longer just a wellness topic, she explains; it’s linked to disability claims, productivity, musculoskeletal issues and cardiometabolic disease, which all show up elsewhere in the benefits budget.
“We're starting to move towards obesity being covered by most employers and most insurance companies,” Mapleston says, noting that coverage is evolving, but remains patchy. Caps can mean that an employee experiences rapid health gains, then loses coverage and faces both weight regain and potentially higher cardiovascular risk when therapy stops.
“Normally, if obesity is covered under an employer contract, there is either an annual or a lifetime maximum to obesity drugs, so that may cover three to six months of that prescription, because they do cost a little bit more,” she says.
“But from an individual's perspective, it's changing lives.”
Practical questions for HR: philosophy, caps and proactive strategy
Even with strong cardiovascular evidence, plan sponsors operate within real constraints, and Mapleston explains that insurers must manage pooled risk across many employers, and employers must respect employee autonomy and physician judgment: “Employer and insurance carriers can't control how long someone stays on a medication.”
From an HR policy perspective, that means evidence can inform plan design but can’t be used to require adherence. For Mapleston, this is pushing employers to think more holistically about obesity, disability and long-term health costs.
“The carrier and the employer don’t really have the ability to say, ‘We're not going to cover it unless you promise to take it for long term,’” she says.
“I don't think that much will change, because I think most people who do go on it for long term, who have diabetes, generally want it to work.”
Mapleston says the starting point for employers is not deciding percentage caps but on a clear philosophy around how they want to approach employee chronic illness as a general values choice. In practice, that might mean establishing if the organization sees GLP1 coverage as a core part of supporting employees with chronic disease, or as a limited addon within a defined budget.
“Whether it's a per annum amount that they max out, or if they're going to just say, ‘You know, this really affects our presenteeism and the health of our employees, we're going to cover these drugs, study or no study,’” she says.
“They need to make their own rules, their own guidelines in terms of what they're going to spend.”
