For years, Medicare patients with obesity could not access GLP-1 weight-loss drugs through their coverage. That barrier is now shifting. The Centers for Medicare and Medicaid Services (CMS) launched a landmark program to cover GLP-1 medications for obesity treatment. This change marks one of the most significant federal moves in obesity care in recent memory. However, the path forward is still uncertain. Policies can shift quickly, and stakeholders must watch carefully.
What the BALANCE Model Means for Patients
The new program carries a long name: Better Approaches to Lifestyle and Nutrition for Comprehensive hEalth. Most people know it as the BALANCE model. CMS announced the program in December 2025. It provides Medicare Part D and Medicaid beneficiaries access to popular GLP-1 drugs at dramatically reduced prices.
Who Qualifies Under BALANCE
Not every Medicare enrollee qualifies. CMS set specific eligibility criteria. Patients who are overweight and have prediabetes qualify. So do those who have experienced a stroke or cardiovascular disease. Additionally, patients with obesity and uncontrolled high blood pressure or diabetes are eligible. Overall, approximately 10% of Medicare enrollees meet the criteria for expanded access. That represents millions of Americans.
How the Trump Administration Struck the Deal
The groundwork began in November 2025. President Donald Trump announced price-cut agreements with two pharmaceutical giants — Eli Lilly and Novo Nordisk. These deals form the foundation of the BALANCE model. Furthermore, the arrangements include most-favored-nation (MFN) pricing commitments. This means drug prices align with the lowest rates paid by comparable nations. In exchange, drugmakers received tariff relief and faster FDA regulatory review timelines.
What the Manufacturers Agreed To
Both companies agreed to major concessions. Eli Lilly and Novo Nordisk accepted a net price of $245 per 30-day supply for all model drugs in Medicare for 2027. Moreover, they committed to MFN pricing across all new drug launches. Novo Nordisk pledged an additional $10 billion in U.S. domestic manufacturing. Meanwhile, Eli Lilly announced at least $27 billion in new U.S. manufacturing investments as part of its agreement.
Which GLP-1 Drugs Are Covered
The BALANCE model covers several widely used medications. These include all formulations of Mounjaro, Ozempic, Rybelsus, and Wegovy. The KwikPen formulation of Zepbound also falls under the program. Additionally, Eli Lilly’s oral drug orforglipron will be included once the FDA approves it. Novo Nordisk’s oral Wegovy tablet received FDA approval in late 2025 and enters the mix as well.
Why These Drugs Matter So Much
GLP-1 drugs work by regulating blood sugar and suppressing appetite. They effectively treat type 2 diabetes, obesity, and cardiovascular disease. Before these deals, list prices ranged from $1,000 to $1,350 per month. That cost locked out millions of patients who could benefit most. Consequently, obesity rates remained stubbornly high. The CDC estimates that 40% of American adults currently live with obesity.
What Patients Will Pay
Cost is the most critical factor for most patients. Under the BALANCE model, eligible Medicare beneficiaries pay just $50 per month. Medicare itself pays the negotiated $245 net price. Furthermore, CMS plans a short-term Medicare GLP-1 demonstration program starting in July 2026. This bridge program gives patients access before the full BALANCE rollout in January 2027. Through TrumpRx, cash-paying consumers can also access Wegovy and Zepbound starting at $350 per month, trending down over time.
How Medicaid Fits Into the Picture
Medicaid coverage tells a more complicated story. Federal law allows states to decide whether to cover weight-loss drugs. As a result, access varies widely. Only 13 states covered GLP-1s for obesity as of January 2026. That figure dropped from 16 states in 2025. Budget pressures and rising drug costs drove states like California and Pennsylvania to drop coverage. Nevertheless, the BALANCE model opens a path. State Medicaid programs can join as early as May 2026. The negotiated discount price for Medicaid remains confidential, though it builds on top of existing statutory rebates.
Surging Medicaid Spending on GLP-1s
Spending on GLP-1s in Medicaid already grew sharply before this deal. In 2024, Medicaid recorded 8.4 million GLP-1 prescriptions. Gross spending hit $8.6 billion that year. These numbers include drugs used for diabetes and other approved conditions — not just obesity. Even without expanded obesity coverage, demand is accelerating fast.
Why This Policy Moment Is Fragile
The headline is promising, but uncertainty runs deep. Medicare is still legally prohibited from covering drugs purely for weight loss. The BALANCE model sidesteps this by framing obesity as a chronic disease with comorbidities. However, statutory language has not changed. Therefore, any future administration could reverse course. The Biden administration proposed similar coverage in its final days — and the Trump administration initially rejected that plan. Policy whiplash is a real and present risk for patients, insurers, and manufacturers alike.
What Comes Next
The BALANCE model timeline is clear. State Medicaid programs apply by mid-2026. Medicare Part D plans join in January 2027. The demonstration period runs through December 2031. Participation stays voluntary for states, insurers, and manufacturers. Consequently, the actual reach of the program depends on how many parties opt in. Patients should confirm their plan’s participation before expecting coverage. Providers should prepare for increased patient inquiries about GLP-1 eligibility. Above all, the industry must stay alert — because CMS policy on obesity drugs has already changed direction more than once.
