The White House announced Thursday a deal with drugmakers to expand access to anti-obesity medications—a policy shift informed by USC Schaeffer Center research that demonstrated the health and economic benefits of such coverage. Under the agreement, Medicare will soon cover these medications at a negotiated rate for certain beneficiaries, while state Medicaid programs and patients who purchase the drugs directly will also have access to discounted prices.
Expanded access addresses a critical public health challenge: More than 40% of American adults have obesity, which is a major driver of chronic disease and imposes a significant economic burden. Schaeffer scholars, who have studied the causes and costs of obesity for nearly two decades, warned as early as 2010 that obesity may be the United States’ most pressing fiscal and public health challenge.
Yet, highly effective, newer GLP-1 medications like Zepbound and Wegovy have remained largely out of reach for Americans who could benefit. This is partly because Medicare has long excluded coverage of medications for obesity or weight loss.
A 2023 Schaeffer Center white paper found broad Medicare coverage would improve beneficiaries’ health and significantly reduce demand for costly medical care. Taxpayers would realize cost offsets of at least $175 billion in the first decade, with even greater savings if private insurers—who often follow Medicare’s lead—expanded coverage.
Trump Administration officials characterized the deal as addressing a significant public health challenge, with expanded coverage expected to benefit approximately 10% of Medicare enrollees. In discussing the new agreement, administration officials said they project savings comparable to those documented in the Schaeffer white paper, driven by reduced obesity-related health risks in the Medicare population. President Donald Trump called the agreement “a triumph for American patients” that will save lives and improve health.
The Schaeffer Center’s obesity research has garnered over 1,000 media mentions since the white paper was published. Schaeffer scholars have made the case for expanded access through op-eds in prominent publications, including the Washington Post, STAT News, the Los Angeles Times and The Hill.
Expanded coverage of obesity medications is “probably the single most effective policy” for improving public health.
— Dana Goldman in STAT News
Schaeffer scholars are frequently consulted by congressional staff and federal health officials on access to obesity treatments. This sustained engagement has established the Schaeffer Center as a go-to resource for policymakers grappling with how to reduce the burden of obesity and chronic disease. A bipartisan bill in Congress allowing Medicare to pay for obesity treatments was informed by Schaeffer research, and the 2023 white paper was cited in the Joint Economic Committee’s annual report.
The Schaeffer Center continues to produce research exploring how Americans would benefit from expanded access. A widely covered 2024 study in JAMA Health Forum documented how Medicare and Medicaid beneficiaries have far less access to the medications compared to privately insured patients.
Earlier this year, a Schaeffer Center white paper found that widespread access would generate $10 trillion in social value, equivalent to about 6% of household wealth. While younger adults would experience the largest gains in health and life expectancy, people who start treatment later in life would also meaningfully benefit.
As the administration implements the new pricing and coverage policy, questions remain about long-term sustainability and how to broaden access to all clinically eligible patients. The Schaeffer Center’s ongoing work on innovative drug pricing models may inform how policymakers navigate these challenges.
Widespread access to anti-obesity medications may be most effectively achieved through value-based pricing approaches, especially as innovation continues in this area. Schaeffer scholars developed a value-based pricing model for obesity treatments that provides lower upfront prices and shared savings with manufacturers as patients avoid obesity-related conditions. This approach could help address concerns about immediate budgetary impacts while ensuring patient access.
The Schaeffer Center’s work on obesity can be found here.
