Medicaid is a joint federal and state program that provides health coverage to millions of low-income adults, children, and people with disabilities across the United States. This public insurance system differs significantly from standard commercial insurance regarding its coverage decisions for specific prescription medications. Because it is jointly funded and administered, the benefits available to an enrollee vary dramatically depending on their state of residence. Coverage for weight loss medications is highly dependent on both federal statute and state policy choices.
The Federal Rule on Weight Loss Drug Exclusion
The federal government establishes baseline rules for what must be covered under the Medicaid Drug Rebate Program (MDRP), but it also defines specific exclusions. A statutory provision within the MDRP generally prevents federal matching funds from being used to mandate coverage for drugs prescribed for “anorexia, weight gain, or weight loss.” This exclusion is the historical default position that has shaped coverage for anti-obesity medications in many states.
This rule means that states are not required to include medications aimed solely at weight management on their Medicaid formularies. The provision creates an option, not a mandate, for states to cover these drugs using their own funds or with limited federal contribution. The exclusion for anti-obesity agents allows states to opt out, even though federal law requires coverage for almost all FDA-approved outpatient drugs.
State Decisions on Coverage
Despite the federal exclusion, states maintain the authority to voluntarily cover weight loss medications. This discretion leads to significant variation, with some state Medicaid programs covering no anti-obesity medications and others offering a broad formulary. The decision often involves a cost-benefit analysis, weighing the high price of newer medications against the long-term cost savings from managing obesity-related chronic conditions.
States that opt for coverage often do so to manage comorbidities such as Type 2 diabetes, hypertension, and sleep apnea. Some states limit coverage to beneficiaries who have specific chronic conditions exacerbated by obesity. As of early 2024, only a fraction of state Medicaid programs covered the newest class of weight loss drugs specifically for obesity treatment, a number subject to change as states re-evaluate budgets and clinical guidelines.
The models states use for coverage range from comprehensive inclusion of multiple anti-obesity agents to limited coverage only for a single, older, and less expensive drug like orlistat. State discretion is the primary factor determining whether a Medicaid enrollee has access to a particular weight loss prescription. The high cost of the newer, more effective drugs has led several states to tighten their coverage criteria as they face budgetary pressures.
Specific Medication Types Covered
When a state decides to offer coverage, the specific drugs included on its formulary vary widely, generally falling into two main categories.
Older Medications
The first category includes older, less expensive generic medications. Examples include orlistat, which works by blocking fat absorption, and phentermine, a short-term appetite suppressant often used in combination with topiramate.
Newer GLP-1 Receptor Agonists
The second category involves the newer, high-cost Glucagon-like Peptide-1 (GLP-1) receptor agonists. These include medications like semaglutide (Wegovy), liraglutide (Saxenda), and tirzepatide (Zepbound), which regulate appetite and blood sugar. All state Medicaid programs are required to cover GLP-1s when prescribed for their Type 2 diabetes indication (e.g., Ozempic, Mounjaro). Coverage for the identical drug specifically for chronic weight management is optional.
For this newer class, coverage is often conditional, even in states that include them on their formulary for weight loss. A patient may only be approved for a GLP-1 if they also have a diagnosis of Type 2 diabetes, or if the drug is being used for its recently approved indication to reduce cardiovascular risk. This distinction determines whether a patient with obesity alone can access the medication under their Medicaid plan.
Patient Eligibility and Approval Requirements
Even in states that cover weight loss medications, a patient must navigate several administrative requirements before a prescription is approved. The most common hurdle is Prior Authorization (PA), where the healthcare provider must submit a formal request demonstrating medical necessity. This process is used by Medicaid programs to ensure high-cost medications are only used by patients who meet established clinical criteria.
Coverage often requires the patient to meet specific physical and clinical benchmarks, such as a high Body Mass Index (BMI). Typically, an adult must have a BMI of 30 or greater, or a BMI of 27 or greater with at least one weight-related comorbidity like hypertension or dyslipidemia. Many states also impose Step Therapy (ST) rules, requiring the patient to first attempt and fail a trial of a less expensive or older medication before the newer, more costly drug will be covered.
The prescribing physician must often document that the patient has failed to achieve adequate weight loss through prior non-drug interventions, such as supervised diet and exercise programs. The continuation of therapy is conditional, with many programs requiring a documented percentage of weight loss, such as 5% of pretreatment weight, within a specific time frame to justify renewal. These requirements serve as practical gatekeepers to manage the substantial cost of these medications.