Soaring Cost of New Weight-Loss Drugs Strains VA Budget
Facing a projected $6.6 billion shortfall in its 2025 medical budget, the Department of Veterans Affairs (VA) is grappling with the rising cost of innovative treatments, particularly weight-loss medications. Dr. Shereef Elnahal, VA Under Secretary for Health, revealed on Monday that roughly $2 billion of this anticipated deficit is directly attributed to the increasing use of new drugs, including GLP-1 agonists like Wegovy and Zepbound, prescribed for weight management and burgeoning health conditions like metabolic dysfunction-associated steatohepatitis (MASH) prevalent among veterans.
“Part of the reason we need the funding is that we know the need for new drugs for obesity … and novel medications for conditions that are more common in veterans," said Dr. Elnahal. "New drugs on the market that will help veterans cost more.”
The VA
reports that a staggering 30% of veterans receiving VA healthcare exhibit risk factors for MASH and other fatty liver diseases, highlighting the urgency for effective treatments.
This financial challenge comes at a time when the Biden administration is proposing expanded Medicare and Medicaid coverage for obesity medications like Wegovy, Ozempic, Mounjaro, and Zepbound. Currently, these medications are only covered for individuals with diabetes or at high risk of heart disease, costing roughly $1,000 per patient every month. The Biden administration estimates that widening coverage to more Medicare beneficiaries would incur a cost of around $25 billion over ten years, while extending coverage to Medicaid patients would add an additional $11 billion in expense over the same period.
However, this proposal faces uncertainties as the incoming Trump administration may take a different stance. Robert F. Kennedy Jr., Trump’s nominee for Secretary of Health and Human Services, has expressed skepticism about these medications, preferring a focus on healthy eating habits. “A fifth of the cost of a bill in Congress proposed to cover all counseling and weight-loss medications for overweight Americans would provide ‘good food, three meals a day to every man, woman and child’ and would ‘solve the obesity and diabetes epidemic overnight,’” Kennedy stated during a Fox News interview.
[
<figcaption/></figure></div> ]In contrast, Dr. Mehmet Oz, Trump’s pick to lead the Centers for Medicare and Medicaid Services, while advocating for further research on these medications, expressed support for their use in his Instagram post. “Ozempic and other semaglutide medications can be a big help … We need to make it as easy as possible for people to meet their health goals, period,” Oz stated.
These diverging viewpoints highlight the complex considerations surrounding access to and affordability of these groundbreaking treatments. Meanwhile,
the VA, facing a pressure cooker of rising healthcare costs, is striving to provide veterans with the cutting-edge medical care they deserve while grappling with budgetary constraints.
The agency announced that following a thorough analysis of expenses in 2024, savings estimations, and projected future care needs, it will require an additional $6.6 billion to cover its medical expenses in fiscal year 2025. This figure, though significantly lower than the estimated $12 billion shortfall announced earlier, underscores the ongoing financial challenges faced by the VA.
“We need more funding to continue our clip of providing more care to veterans than ever before,” said Dr. Elnahal, emphasizing the VA’s commitment to meeting the
healthcare needs of its veteran population.
