CMS Rejects Coverage for Anti-Obesity Drugs

The Centers for Medicare & Medicaid Services (CMS) announced it will not proceed with a Biden administration proposal to cover anti-obesity drugs like Wegovy and Zepbound under Medicare and Medicaid. This decision aligns with the Trump administration's stance, which deemed the proposal inappropriate due to its high cost, estimated at $35 billion over the next decade. The proposal aimed to reinterpret existing statutes to classify obesity as a chronic disease, thereby qualifying these drugs for coverage under Medicare's Part D. Health and Human Services Secretary Robert F. Kennedy Jr. has been a vocal critic of these drugs, favoring lifestyle changes over pharmaceutical solutions. Despite bipartisan support in Congress through the Treat and Reduce Obesity Act, which failed to advance, CMS may revisit the policy based on further evaluations. The rejection of the proposal has led to a decline in shares of companies like Eli Lilly and Novo Nordisk, makers of these drugs.