Healthcare CFO: Are you asking the right questions about GLP-1 coverage?

We’ll stress you out with stats for a second, if you don’t mind: Health benefit costs are expected to climb 8.2% next year, the highest increase since 2003, according to a recent survey from professional services firm Marsh.

If that rise occurs, it would mark the fifth consecutive year of climbing healthcare benefit costs.

So…good. We’re all stress-y. And that’s probably justified, Antonio Cueto, CFO of Judi Health, a pharmacy and medical benefit management platform, told CFO Brew.

“You have double-digit growth in cost of care year over year, and you know, it’s compounding,” Cueto said. “Even the biggest employers in the country, with strong balance sheets and P&Ls, can’t afford it anymore.”

What’s the answer for forward-thinking CFOs who want to opt out of the annual health benefits cost shocks? “It’s a moment in time when we need to reimagine how we think about benefits,” Cueto said. “It used to be an HR issue. Now it’s a boardroom issue.”

Taking a shot. As companies try to address healthcare expenses, “things like GLP-1s are conversations in the boardroom, and it didn’t used to be that way, and that can tell you how material this has become,” Cueto noted.

The Marsh healthcare costs survey anticipated that GLP-1 prescriptions will comprise “a full percentage point of the overall cost growth for 2027.”

“The utilization of these medications has been so much greater than anyone could have anticipated that it has really been a factor pushing up cost,” Beth Umland, director of employer research for health and benefits at Marsh, told us in an interview. She added that “most of the employers who offer them will continue to offer them, but just maybe tighten the utilization controls,” though a “small percentage” may drop coverage.

For most CFOs, however, a good GLP-1 strategy will be about finding a happy medium, Cueto said. “People are thinking about this in a bit of a black or white equation,” he explained.

Instead, CFOs and the rest of the C-suite should focus on asking the right questions about their policies, like who should qualify for GLP-1s for weight loss and what measurable outcomes could justify the cost, Cueto said.

“You need to have evidence-based eligibility requirements in order to grant GLP-1 treatment. Two, you need ongoing clinical engagement. Three, you need outcomes measurement, because otherwise you’re not able to measure how effective the drug is in your population. And then last, you [need] financial oversight on the cost,” he continued. “I think if you do that, you can have a long-term, sustainable GLP-1 program.”

Look to HR. Such a program is easier said than done, of course. The primary challenge ahead for CFOs is getting the board on board.

To that end, Cueto stresses the importance of building HR partnerships as a historically HR-centric issue increasingly moves to the boardroom.

“The head of HR and the CFO need to be extremely close and driving the bus together,” he said. “For example, at Judi Health, the head of HR and I spend a lot of time thinking about our benefits. We meet with our benefits broker, look at the plan at least twice a year. We look at the trends on a quarterly basis. How is it doing? Why is it performing that way? How do we improve it?”

And, like you’ve heard a million times before, your relationship with your CEO is pretty crucial here, too.

“CEOs are getting board calls on a pretty regular basis around healthcare costs,” Cueto said. “You need to make sure that the CEO has the critical information to be able to address those questions from the board, because…it’s a critical topic for investors.”

The most common mistake that Cueto sees CFOs make, outside of neglecting these critical relationships, is overlooking the data in the decision-making process.

“When you’re thinking about…making benefits decisions for the following year, you need to have your claims data,” he said. “You need to understand who your vendors are. If you don’t have that visibility into what is covered, how much it costs, what you [are] giving your employee population with those benefits…you will not make the right decision.”