We’re used to thinking about cost containment as a lever we can pull. Tighter formularies. Stricter utilization management. More aggressive audits. But there are moments in healthcare where the lever snaps, where traditional tools don’t work fast enough or deep enough to make a dent.
GLP-1s are that moment.
If you work in health plan pharmacy, you already know what I mean. Semaglutide. Tirzepatide. Branded names like Ozempic, Wegovy, and Mounjaro. These drugs, originally developed for diabetes, are now driving the most explosive cost curve we’ve seen in a generation.
And they’re not going away.
GLP-1s by the numbers
Let’s ground this in data. According to Trilliant Health’s 2025 trends report, the use of GLP-1s rose 744.6% between 2018 and 2023, marking a shift away from bariatric surgery as a preferred treatment option for weight loss. Across the industry, the utilization of GLP-1s has been so significant that they account for 21% of total pharmacy spend.
For some of our plans, we’re seeing as much as 80% of their pharmacy spend growth since 2020 had been due to this class of drugs. Not inflation, not a diversified pipeline of new brand-name or specialty drugs, but GLP-1s are driving almost all of their pharmacy spend growth over the past few years.
With celebrity endorsements and seeming success from everyday people, GLP-1s are being requested by name from members and employers, and providers are prescribing them at scale.
The long-term return on investment, however, is still a question mark.
Why pharmacy cost containment falls short
Traditional cost containment strategies rely on the key assumption that we can curb usage without compromising outcomes. But GLP-1s challenge that logic.
Yes, they’re expensive, with some topping $1,300 per month per member. But they also entice with the promise of reducing downstream costs related to diabetes, heart disease, and even addiction. The problem is that those savings are hard to model. They happen over years, not quarters. And we don’t have enough long-range data to offer substantial support to those claims. As pharmacy operates with annual plan design and short member tenure, that’s a tough sell.
This creates an operational paradox. You either deny access and risk member dissatisfaction, negative health outcomes, and plan shopping. Or, you allow access and your pharmacy costs skyrocket, often without clear accountability for value.
Fortunately, I’m seeing lessons in the GLP-1 wave that can inform the next right choice.
GLP-1s introduce downstream medical risk
While much of the GLP-1 conversation centers on pharmacy spend, the drugs are not without clinical risk. For payers, that matters because adverse events don’t stay contained within the pharmacy benefit.
Less common, but more serious side effects associated with GLP-1 agonists include pancreatitis, gastroparesis, bowel obstruction, and gallbladder-related complications. Each of these conditions can trigger emergency department visits, advanced imaging, specialist referrals, or inpatient admissions.
For plans that cover GLP-1s, this creates an additional layer of financial exposure. The true cost of coverage may include not only the medication itself, but also downstream medical claims tied to adverse events, treatment discontinuation, or complications requiring acute care.
This doesn’t negate the potential long-term value of GLP-1s, but it serves as a reminder that pharmacy return on investment (ROI) models that exclude medical risk are incomplete. A balanced coverage strategy must account for both the upside and the operational and clinical realities that accompany widespread use.
What we’re learning from the GLP-1 wave
GLP-1s are teaching us three key lessons about the limits of conventional pharmacy management:
1. Formularies alone can’t carry the weight
Payers often look to tiered formularies and step therapy to guide member behavior. But with GLP-1s, member demand is high and growing. And thanks to direct-to-consumer marketing, member pressure is shifting the conversation from "Is this covered?" to "Why isn't this covered?"
We need formularies, but we also need evidence-based criteria, predictive analytics, and benefit designs that align incentives over time.
benefit designs that align incentives over time.
2. Preauthorization is a Band-aid, not a fix
We’ve seen payers implement complex pre-auth protocols for GLP-1s like BMI thresholds, comorbidity checks, and lifestyle program enrollment.
But this adds administrative burden without necessarily improving outcomes. Providers push back. Members appeal. Call centers overload. And too often, the decision gets overturned anyway.
Pre-auth has a place. But it can’t be our primary defense.
3. We need better predictive modeling
Payers are often fixated on how much these drugs cost, but the bigger question is what the full clinical and financial journey of the member looks like.
That requires integrating pharmacy data with medical claims, data about patients’ social risk factors, and historical patterns to project future risk and value.
Some platforms are starting to do this. But most plans still operate in silos, with pharmacy benefits managed separately from care management, risk adjustment, or even primary care strategy.
Rethinking ROI in pharmacy cost containment
GLP-1s force us to remember that not all high-cost drugs are waste. Therefore, not all cost containment is value creation.
Payers face a significant risk in covering a high-cost drug for a member that may switch plans before the benefits of treatment are realized. It’s a valid concern. But it’s also a signal that our system is too short-sighted. If everyone waits for someone else to act, no one acts.
We need new ROI models that consider value alignment from three critical angles. First, we’ll want to look at population-level trends, not just individual member return on investment. Second, we need to consider shared risk across payers, employers, and manufacturers. Finally, we need to examine time-adjusted outcomes.
What payers can do now
GLP-1s present a unique opportunity for payers to broaden their perspective on value creation above and beyond cost containment.
Consider these five strategic steps:
1. Quantify the impact of GLP-1s on your total cost of care
It’s time to start building models that look beyond pharmacy claims to validate the effects of GLP-1s in the long term. These models should identify if members on GLP-1s are seeing fewer inpatient admissions, improved A1C control, and fewer cardiac events.
That data is being created today, but it’s buried in unlinked systems.
2. Segment your population for smart access
Not every member needs a GLP-1, but some do. Use stratification models to identify high-risk, high-cost populations who may benefit most.
3. Pilot value-based coverage models
What if we considered GLP-1 coverage from a value-based care model? Could we negotiate outcomes-based arrangements with manufacturers? Could we tie coverage to engagement in broader health programs?
We’re starting to see this emerge. Payers that move first will shape the terms.
4. Engage employers in benefit design strategy
GLP-1s are changing employer expectations. Rather than waiting for them to push for coverage, invite them into the conversation about what sustainable, responsible access looks like.
5. Modernize pharmacy operations to support agility
You need the ability to adjust criteria, track outcomes, and respond to clinical policy changes in near real time. Static systems and disconnected vendors won’t cut it. Invest in partnerships that combine proven technology with subject matter experts.
Not all spend is waste
It’s tempting to treat GLP-1s as the new pharmacy villain. But not all spend is waste. And not all savings are smart.
The real challenge is to distinguish between cost and value. Between temporary relief and long-term impact. If GLP-1s do deliver on their promise—reduced heart attacks, fewer diabetes complications, improved quality of life—then the right question isn’t how to block them, but how to use them wisely, fairly, and sustainably.
For other examples of quiet value loss, read: The Hidden Pharmacy Waste Payers Can’t Afford to Ignore.
Smarter systems empower expert payers to handle innovation at scale. The rise of GLP-1s is a reminder, if not a lesson, in leveraging the technology, data, and expertise payers already have to evolve with consumer needs.
Is your plan struggling with high per member per month costs? I love a challenge. Contact us to discuss strategies to recover more pharmacy savings.
Derek McMahan, SVP Pharmacy, is an attorney focused on pharmacy payment integrity. He leads Machinify's Pharmacy Payment Solutions (PPS) operations, where he brings a rare depth of insight to the often-overlooked world of pharmacy payment integrity.
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