The news: Cigna will stop covering GLP-1 drugs for weight loss under its employee health plan starting July 1, per Reuters. The change applies only to Cigna employees and will not affect coverage for other Cigna health plan members. It also will not impact Cigna workers whose drugs are covered to treat type 2 diabetes. For context, Cigna employs roughly 60,000 people in the US, though it’s unclear how many were covered for weight loss drugs under the company’s employee health plan.

Why it matters: Cigna joins a growing list of employers and insurers scaling back GLP-1 weight loss drug coverage as prescriptions surge. While the move should reduce spending in the near term, it will disrupt employees already taking medications like Zepbound and Wegovy, forcing many to seek alternative access routes to maintain treatment—most notably via the cash-pay market.

Nearly 80% of employers said that GLP-1s are driving an increase in their company’s healthcare costs, per a May Business Group on Health survey. This spike is driven by high utilization and complex PBM models, where opaque pricing and rebate structures can limit employers' ability to capture the lowest net drug prices. As a result, multiple states are terminating (or seriously considering terminating) GLP-1 weight loss drug coverage for state employees. HCA Healthcare, one of the largest US health systems, told employees it wouldn’t keep covering weight loss drugs Zepbound and Wegovy this year, citing a 90% increase in 2025 costs from GLP-1 obesity medications, per STAT.

Currently, only about 9% of commercial plans provide unrestricted coverage for Wegovy, and just 4% do so for Zepbound, according to GoodRx tracking data. Far more plans cover these drugs but impose restrictions, such as requiring prior authorization or that patients first try a lower-cost medication. For context, Zepbound and Wegovy are FDA-approved specifically for chronic weight management. Ozempic and Mounjaro are FDA-approved to treat type 2 diabetes, not obesity, although they are sometimes prescribed off-label for weight loss.

More consumers are paying out of pocket for weight loss drugs amid uneven insurance coverage. For instance, cash-pay patients accounted for about 45% of total Zepbound prescriptions in Q1 and 55% of new Zepbound prescriptions, per Lilly’s April earnings call. Cash-pay prices for weight loss drugs have fallen, but most patients still pay at least a few hundred dollars a month, with costs varying by formulation (pill or injection) and dose. And prescription drug purchases made outside a health plan's coverage typically do not count toward a member's deductible.

Implications for the GLP-1 market: More employers will get ahead of the high costs associated with rising GLP-1 use by significantly restricting or eliminating coverage for the drugs, particularly as new oral formulations broaden their appeal. Telehealth providers in the cash-pay GLP-1 market will pick up some patients who lose coverage, but many consumers won’t be able to absorb the jump from an insurance copay (~$25) to paying at least a few hundred dollars out of pocket. That could push Lilly and Novo to compete even more aggressively on price to preserve access, or expand direct-to-employer agreements that can secure lower prices for covered drugs than what the PBM model dictates.

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