Wrongful Denial of Weight Loss Drugs
The last few years have seen a revolution in weight loss due to the development of highly effective medications, including drugs like Ozempic and Mounjaro for diabetes and Wegovy and Zepbound for weight loss. Drug-assisted weight loss not only helps battle the obesity epidemic but also improves health by reducing the risk of cardiovascular disease and other dangerous health conditions associated with being overweight. Because these drugs are both expensive and wildly popular, health plans have started to pull back and limit or deny coverage. These actions are being taken for one reason only: to save money for insurers, regardless of the health benefits these medicines provide to individuals with serious health conditions.
If your request for healthcare was wrongfully denied by your insurer, contact Gianelli & Morris in Los Angeles to speak with one of our California insurance bad faith lawyers. We fight every day to see that Californians get the medical care they need and are compensated for the harm caused by unfair denials and unreasonable delays.
Denials of Coverage for Ozempic, Wegovy, Mounjaro, and Zepbound
Many of the new drugs on the market that have aided millions in achieving significant weight loss are GLP-1 (glucagon-like peptide 1) receptor agonists like semaglutide, which is manufactured by Novo Nordisk and marketed under the brand names Ozempic and Wegovy. Ozempic is the best-known GLP-1 medication. It is FDA-approved to treat Type 2 diabetes but has been widely prescribed off-label for weight loss. Wegovy, in contrast, is specifically approved by the FDA for chronic weight management to treat obesity and improve health outcomes in overweight individuals, even if they don’t have diabetes. Wegovy has also been FDA-approved for overweight individuals with heart disease.
Other GLP-1 medicines include tirzepatide manufactured by Eli Lilly and Company and marketed as Mounjaro to treat Type 2 diabetes and as Zepbound for weight loss in adults with obesity or who are overweight and have at least one weight-related medical condition. Novo Nordisk has also been making another GLP-1 receptor agonist known as liraglutide, which it markets as Saxenda for weight management in overweight adults and adolescents with a body mass index (BMI) of 30 or more or a BMI of 27 or more plus at least one weight-related condition, such as high blood pressure or type 2 diabetes.
There is no question that these drugs are expensive. Wegovy, for example, can cost as much as $1,350 per month, placing it far out of reach for most people to private pay for the medication despite its benefits to their health. As the popularity of these medications has exploded, their cost has led insurance companies to start pulling back on coverage.
Insurance Company Strategies to Deny Coverage
Most employer-sponsored health plans don’t cover many of these medications, and neither does Medicare. California Governor Gavin Newsom has proposed cutting Medi-Cal coverage for Ozempic and Wegovy starting in 2026. Meanwhile, employers with health plans that do cover these drugs have started to restrict coverage to control costs. This is being done through various utilization management strategies.
Utilization management (UM) is a healthcare practice that in theory aims to ensure that patients receive appropriate and necessary medical services while controlling costs. It involves strategies such as:
- Reviewing medical records: Examining patient health information to assess the medical necessity of proposed treatments, procedures, and medications.
- Establishing guidelines: Using evidence-based criteria and clinical protocols to determine if services are appropriate.
- Prior authorization: Requiring healthcare providers to obtain approval before providing certain services, such as expensive medications or specialized procedures.
- Case management: Coordinating care for complex patients and managing high-cost medical conditions.
- Patient education: Providing patients with information about their health conditions, treatment options, and cost-saving measures.
Unfortunately, these tools are often used primarily or solely to contain costs without considering whether a new treatment, even if more expensive than alternatives, would better manage the patient’s health.
Requiring Other Therapies First
Even though these new medications have proven highly effective for weight loss, older, cheaper drugs are also on the market. One tack insurance companies take to avoid covering drugs like Ozempic is to require policyholders to try other therapies first and only approve coverage if the alternative therapies don’t work.
Alternative therapies might include lifestyle management such as diet and exercise or staying on older, cheaper drugs for several months. Unfortunately, many people have trouble changing habits or lifestyles that have been ingrained over decades, and many of these older drugs have negative side effects like diarrhea that keep people from staying on them very long. By forcing people to try alternatives they are not likely to be successful at, the insurance companies delay coverage of successful drugs like Wegovy or Zepbound or even argue that the patient failed to complete the alternative treatment and so shouldn’t be allowed to access the new drugs.
Canceling Coverage
Another cost-cutting move that insurers have been adopting is to approve the drug at first but then cut it off once the patient achieves a BMI in the normal range. As the argument goes, once the patient has a normal BMI, they no longer need a weight loss drug and are therefore no longer eligible for it. This argument ignores the fact that patients who lose weight on medications like Ozempic or Wegovy quickly regain weight once they stop the medication. It is a devious practice that flies in the face of sound healthcare to stop coverage of a successful treatment precisely because the treatment has proven to be successful.
Our Bad Faith Insurance Lawyers Have Been Down This Road Before
As a law firm that has been fighting bad faith insurance company practices for decades, this retrenchment of coverage for Ozempic and related drugs is nothing we haven’t seen before. Insurance companies have a history of paying for important therapies until they get too popular or expensive; then they start to deny coverage. They change their internal guidelines to say the treatment under scrutiny is unproven or not medically necessary, or they outright add exclusions to their policies so the drug or treatment simply isn’t covered.
The Centers for Disease Control and Prevention (CDC) has declared obesity to be a growing epidemic that already affects nearly 40% of adults in the US. It is also well-established in the medical community that weight loss reduces cardiovascular risk and diabetes. It should be equally clear to the insurance industry that improving the long-term health of their policyholders would save them money in the long run, but they don’t look at that benefit; they only look at their current balance sheets and seek to cut costs by limiting or denying coverage for expensive therapies, regardless of their benefit to the people they should be helping.
Contact Us Today
If you have been denied insurance coverage for a weight loss drug prescribed by your doctor, contact Gianelli & Morris to share your story with us. Based in Los Angeles, we represent people throughout California and are currently investigating whether insurers are wrongfully withholding coverage or denying claims for Ozempic and other weight loss drugs. Your health matters, and so does being treated fairly.
