State seeks to reinstate weight loss drug coverage for NC government workers

The North Carolina State Health Plan is seeking to bring back coverage of weight loss drugs such as Wegovy and other GLP-1 medications — a major reversal following months of efforts to negotiate lower prices with drugmakers.

The health plan covers more than 700,000 state government employees, retirees and their family members. Last year the plan’s administrators stopped coverage of GLP-1 drugs for the purposes of weight loss, as officials expressed concerns about the expensive drugs running up a large bill for a system already grappling with all kinds of rising health care costs.

But since then voters have elected a new state treasurer — the official in charge of the State Health Plan — and some of the biggest drug companies behind these drugs have announced price cuts.

On Friday the top lobbyist for State Treasurer Brad Briner, Amy Auth, told the health plan's board that she's in talks with state lawmakers about the health plan's request for an extra $100 million in the annual state budget. That wouldn't be enough to cover GLP-1 medication for all state workers who want it. But it would cover an estimated 14,000 state workers who have a body-mass index of 38 or higher.

In an interview Friday, Briner said the State Health Plan really had no choice but to cut coverage of GLP-1 drugs in 2024 — not just because of their cost but also because the plan had to cover them for anyone who wanted them. Now, he said, the plan will be able to re-write the rules to be more targeted at only those who will benefit the most.

"If you wanted to lose five pounds, or you need to lose 100 pounds, we had to treat you exactly the same," Briner said, adding that under the new rules being proposed now, the state would "be able to differentiate between populations that really have obesity problems, and those that want to use them for maybe aesthetic purposes."

A BMI of 30 is considered obese, and BMIs of 40 or above are considered "extreme obesity" according to the National Institutes of Health. State officials believe bringing back coverage of GLP-1 drugs, at least for state's most obese workers, will have long-term benefits that make the short-term costs worth it, since obesity is linked to a whole host of other medical problems.

State officials believe bringing back coverage of GLP-1 drugs for weight loss, at least for state's most obese workers, will have long-term benefits that make the short-term costs worth it, since obesity is linked to a whole host of other medical problems.

Briner, a former investment banker, said in an interview Friday that the long-term cost reductions won't only come in the form of people on the State Health Plan getting healthier. These drugs have already been getting cheaper, he said, and are only going to continue dropping in price.

"Everybody knew five years ago, in the investment business, that GLP-1s worked," he said. "So guess what happens? Everybody invents their own. ... As you look out at the approval timeline for 2026 and 2027 for Roche, and other big pharmaceutical companies, they all have a GLP-1 coming. So that's the basis of my optimism about price reducing. Competition is coming."

Auth noted that the $100 million request comes as state lawmakers expect to have an approximately $500 million surplus this year. But there will be a lot of competition for the money, she said, especially as lawmakers consider how much to allocate for Hurricane Helene relief.

In addition to that $100 million for weight loss drug coverage specifically, the State Health Plan is also seeking about $300 million over the next two years to cover deficits that have been brought on by a combination of rising drug prices, and aging population and a years-long push by former State Treasurer Dale Folwell not to raise premiums on state employees.

Folwell, a Republican, ran for governor in 2024 instead of seeking reelection as treasurer. He was replaced by Briner, a fellow Republican. Folwell started the effort to cut GLP-1 coverage, but he also publicly pressured drugmakers to negotiate directly with the state to lower prices in exchange for the State Health Plan bringing back coverage. Briner indicated Friday those negotiations could continue, even as the plan seeks to find other options to bring back coverage on a smaller scale.

"We will get back to covering GLP-1s," he said. "Either through some bilateral contract with the manufacturers of them, or through the market."

The State Health Plan faces a anticipated deficit of approximately $500 million next year and $1.5 billion by 2027. Auth said Friday that while the plan wants the legislature to help cover some of those costs, there’s no denying that premiums will need to rise no matter what. But exactly how much premiums go up could depend on what, if anything, lawmakers agree to pay to help.

“Taxpayers cannot bail out the state health plan on their own,” Auth said, adding: “We will all need to contribute a little more to keep the health plan viable.”

Since taking office in January, Briner has moved quickly to make some major changes. One of his first announcements was that he would raise premiums for the state health plan by using a new sliding scale that would charge higher-paid employees more money for health insurance, rather a flat rate.

And this week he also endorsed a proposal with backing by top Republican leaders at the legislature to allow Briner to invest up to 10% of many state investment funds, including the state pension plan, into cryptocurrencies.