Employers Buckle Down on Pharmacy, Medical Costs

As Americans’ increased use of glucagon-like peptide-1 medications to treat obesity continues to balloon pharmacy costs, employers are looking to tighten their coverage parameters to manage medical costs more broadly. But employees question whether their companies are doing enough to control the costs borne by employees.

Of employer respondents to Marsh McLennan Agency’s 2026 National Benefits Strategy Survey, 76% reported that managing pharmacy costs was either important or very important to them in the next 12 months. Yet cost control on the GLP-1 medication front may still need to take shape: According to an International Foundation of Employee Benefits survey, GLP-1 medications used for weight loss comprised an average of 10.5% of employers’ annual claims last year, an increase over the 2024 average of 8.9% and the 2023 average of 6.9%.

Nearly half of the organizations MMA surveyed (48%) said they do not currently cover GLP-1 medications for weight loss and have no plans to add coverage anytime soon. The share of employers covering GLP-1 medications for weight loss or considering doing so actually rose 12 percentage points, to 52% in 2026 from 40% in 2025, but more employers implemented restrictions over the past year. The share of organizations covering GLP-1s without restrictions for both diabetes and weight loss declined to 4%, a drop of 3 percentage points. Coverage of the medicine for diabetes and for weight loss only when certain criteria are met declined by the same amount to 30%.

“This reflects a cautious stance among employers toward including GLP-1 medications in their benefits, despite growing acknowledgment of their effectiveness in managing metabolic conditions,” the MMA report stated.

Of employers currently covering modern weight loss drugs for weight management, only 72% said they were likely to continue doing so in 2027, according to a recent survey from the Business Group on Health. Meanwhile, of those employers not currently covering GLP-1 medications for weight loss, 18% said they were considering doing so—up from 0% the year prior, MMA found in a separate survey.

Medical Costs Overall

Aside from paring down pharmacy benefits, employers are battling rising medical costs on a larger scale—both for themselves and their employees.

According to the Prudential Insurance Co. of America’s “Benefits & Beyond” report, released Monday, 28% of employers said they adjusted how they funded their benefits sometime within the past 12 months, 26% reported raising the medical deductibles in their plans over the same period, 24% reported offering benefits to help with employees’ medical expenses in retirement, and 22% said they passed along higher medical costs to the employee.

Meanwhile, the report found the negative effect of rising costs across the economy on employees was clear: 68% of employees surveyed reported experiencing at least some financial stress in the past 12 months, with 28% saying the stress was “significant or overwhelming” for them. Of those who reported experiencing increased medical costs in the past year, some said paying medical costs made it just as significant or overwhelming to address financial stress (32%), mental health (22%) and physical health (22%).

“Financial stress drives employees to make tough decisions, like postponing medical care, dropping benefits and rethinking retirement timing,” the report stated. “These actions can impact productivity and engagement, forming patterns employers cannot ignore as they also grapple with rising costs.”

Employers that reported experiencing an increase of at least 15% in medical costs over the past 12 months said they were likely to plan larger changes to their benefits offerings—whether additions, cuts or both—over the next two years. Three-quarters of employers said they believed they were doing enough to contain rising medical costs, while only 46% of employees agreed.

MMA collected responses from 616 employers in January and February 2026.

The Business Group on Health surveyed 105 employers in February and March.

Prudential surveyed 3,096 employees and 760 employers in January.