Why Should Delaware Care?
Delaware began to cover commercial weight-loss drugs like Ozempic and Wegovy for state employees in 2023 as part of the state health plan. Now, claims for the drug have skyrocketed, and taxpayers are footing the bill.
Delaware state workers’ increasing use of blockbuster weight-loss drugs is weighing heavily on the state’s budget.
The state will likely spend more than $134 million on drugs Ozempic and Wegovy for state employees in 2026 — more than double the amount spent the previous year, according to projections made by the State Employees Benefits Committee, which manages benefits for state workers.
The increase in spending mirrors a recent boom nationally in the popularity of the injectable weight-loss drugs made by the Danish manufacturer Novo Nordisk.
In 2021, the U.S. Food & Drug Administration approved a formulation of Ozempic – a drug that has long treated type 2 diabetes – for use in weight loss. The drug mimics a hormone that targets the appetite-regulating area of the brain, reducing a patient’s perceived hunger.
The drug also carries a monthly cost of about $1,000 without insurance,
In 2023, the Delaware state employee health care plan began to cover most of those costs for weight-loss patients. Officials initially budgeted about $2 million in the 2024 fiscal year, but the actual price tag reached more than $14 million that year and has continued to grow since.
In 2029, state projections show taxpayers could spend as much as $216 million, according to documents referenced during a meeting of the State Employees Benefits Committee on Tuesday.
If that growth occurs, it could materially impact spending priorities in the state budget.
Spending on the drug Ozempic for its original purpose of treating type-2 diabetes has also increased in recent years, but not as dramatically. In 2026, the state expects to spend nearly $38 million on the drug for diabetes treatment. By 2029, it could be $53 million.
Workers on the state’s health plan pay anywhere from 4% to 13% of the cost out of pocket. The remainder is paid by taxpayers through the state’s General Fund.
During Tuesday’s meeting of the State Employees Benefits Committee, officials briefly discussed whether the state should reconsider the level of coverage it provides employees for weight-loss purposes. One committee member also questioned whether the board should consider charging copays for the drugs.
But committee chair Brian Maxwell, who also serves as director of the Delaware Office of Management and Budget, said if the state could lose rebates it redeems from drug manufacturers, if it did begin to charge copays to state employees. He did also note that other states have considered no longer covering the cost of the drug for weight-loss patients, calling the landscape “ever-changing.”
Also during the meeting, Lt. Gov. Kyle Evans Gay said the state should examine long-term benefits of the drug, including any “chronic illness decline that we are hoping to see in our population.”
Documents from a July meeting of the State Employee Benefits Committee revealed that the state expects medical costs to trend downward over the long term as a result of weight-loss drugs.
In early 2024, Spotlight Delaware first reported that commercial weight-loss drugs, such as Ozempic and Wegovy, were among the most prescribed and expensive medicines for state workers.
