A new generation of glucagon-like peptide-1 drugs approved for the treatment of obesity will soon be available in Canada, presenting an opportunity for plan sponsors to meet members’ health and wellness needs.

It’s important for employers to consider meeting with their insurer now to find out how the rollout of these drugs will affect their benefits plans, including information on what the process will be for prior authorization, says Jennifer Schmidt, partner and innovation leader at Mercer Canada. “For example, what kind of measures would they use? Do they use [body mass index] or are there other indicators? Because obesity is a chronic disease, but it’s a little less clear-cut in terms of diagnosis than diabetes. So I think that’s going to be a gray area that needs to be sorted out.”

Read: How plan sponsors, insurers are considering coverage of weight-loss drugs amid rising use of Ozempic

She suggests plan sponsors approach this rollout from a holistic perspective, rather than just cost in terms of drug spend because the overall focus on employee health and well-being could lead to lower costs for their companies. Indeed, plan sponsors that decide to cover these drugs could see fewer disability claims, increased engagement or decreased use of sick days.

“They shouldn’t just be looking at their drug spend, they should be potentially looking at productivity, engagement, absenteeism and presenteeism — all these things. If someone has a chronic disease, it’s possible the disease can impact their ability to work at their best level. For any of these conditions, you need to look at the bigger picture and not just isolate the drug spend.”

Employers also have to consider the role of their benefits program, says Schmidt, noting in the post-coronavirus pandemic world there’s a recognition that prevention and mitigation of risk is a valuable thing. “If you can support someone in preventing the development of diabetes, why wouldn’t you? Why wouldn’t you support someone instead of paying for test strips and insulin later? I think we have to try not to do disservices to those who are trying to get well and those who are trying to manage their chronic conditions. And for those who don’t even have chronic conditions yet and are trying to stay healthy.”

Read: My Take: Obesity should be treated like other chronic conditions under benefits plans

There’s potential for increased demand of these drugs to drive up their price here in Canada, Schmidt adds, noting this happened during the rollout of GLP-1 drugs for diabetes management, which saw high demand from employees.

She says plan sponsors will also have to consider whether active managed formularies are a good thing, because there are still a lot of drug plans that are wide open. “[In this case] you’re not necessarily managing what the best drug is at the best price for the condition. I think the easy fix is to put in a maximum, but it’s not necessarily the right fix. Employers could say they’re not going to cover obesity drugs because they’re called ‘lifestyle drugs.’ Lumping them into this [outdated] category and saying [they’re] going to cap your drug expenses on it, I just don’t think that’s going to stand the test of time.”

Read: Annual spend per private drug plan member up 6.3% in 2022: report