Following a pricing agreement reached under the Trump administration, the U.S. Centers for Medicare & Medicaid Services (CMS) announced a voluntary initiative on Tuesday to include GLP-1-based weight-loss and diabetes treatments under Medicaid and Medicare Part D coverage.

In November, President Trump secured agreements with Eli Lilly (LLY.US) and Novo Nordisk (NVO.US) to significantly reduce prices for popular GLP-1 weight-loss drugs across Medicare, Medicaid, and out-of-pocket patient groups. The newly unveiled CMS plan builds on this agreement, with Medicaid implementation expected as early as May 2026, followed by Medicare expansion in January 2027.

Under the "BALANCE Initiative," CMS will negotiate net drug prices directly, establish standardized coverage terms, potentially cap patient copays, and provide evidence-based lifestyle support services. Eligible Medicare beneficiaries will pay just $50 monthly for GLP-1 medications, including Novo Nordisk's Wegovy (semaglutide) and Lilly's Zepbound (tirzepatide).

To facilitate the transition, CMS will launch a Medicare GLP-1 payment pilot in July 2026, allowing enrollees to purchase medications at government-negotiated rates. CMS Administrator Mehmet Oz stated on platform X that the program aims to "expand access to select GLP-1 therapies while promoting healthy habits."

Participation remains optional for drugmakers, state governments, and insurers. The Trump administration previously disclosed that two highly anticipated oral weight-loss drugs under development by Lilly and Novo Nordisk would be priced at $149 monthly for Medicare/Medicaid patients and cash payers.

Notably, Novo Nordisk's oral weight-loss drug received approval this Monday, while Lilly's counterpart remains under review. For currently approved GLP-1 injectables treating diabetes and other covered conditions, monthly costs for Medicare/Medicaid patients will drop to $245.