Medicare BALANCE Model: What Changes for GLP-1 Coverage

In December 2025, CMS announced the BALANCE Model — a demonstration program to expand Medicare and Medicaid coverage of GLP-1 medications for beneficiaries with obesity and qualifying comorbidities. Monthly copays are expected to be capped at $50. Medicaid enrollment launches as early as May 2026; Medicare Part D follows in January 2027.

For decades, Medicare has been prohibited from covering weight loss drugs under Part D, even as clinical evidence mounted that obesity is a chronic disease with effective pharmacological treatments. The BALANCE Model represents the first structural attempt to change this. It's a demonstration program — not a permanent policy change — but it establishes a framework for expanded GLP-1 access that could become permanent if the program demonstrates cost-effectiveness.

What the BALANCE Model Is

The BALANCE (Beneficiary Access to Lower-Cost Approaches for Nutrition and Comprehensive Exercise) Model is a CMS Innovation Center demonstration program. It tests whether covering GLP-1 medications for obesity — combined with lifestyle intervention — reduces overall healthcare costs for the Medicare and Medicaid populations by preventing or reducing obesity-related complications like cardiovascular disease, type 2 diabetes, kidney disease, and sleep apnea.

The model is structured as a savings-sharing arrangement: if total healthcare spending decreases for enrolled beneficiaries compared to a control population, the model is deemed successful and could be expanded or made permanent through regulation.

Who Qualifies

Initial eligibility criteria include Medicare or Medicaid beneficiaries with a BMI of 30 or higher (or 27+ with qualifying comorbidities), who are not currently taking a GLP-1 for diabetes, and who agree to participate in structured lifestyle interventions alongside medication. The specific comorbidities that qualify are still being finalized but are expected to include type 2 diabetes risk, cardiovascular disease, obstructive sleep apnea, and MASH.

Timeline

What This Means for Patients

For the estimated 42% of American adults living with obesity, the BALANCE Model represents the first federal pathway to affordable GLP-1 access through public insurance. At $50/month, the program would reduce the cost barrier from $1,000+ to a manageable level for most beneficiaries.

However, the demonstration model has limitations. It is not available to all Medicare/Medicaid beneficiaries immediately — enrollment is phased and geographically limited during the pilot period. The lifestyle intervention requirement adds a compliance burden. And as a demonstration program, its continuation depends on showing cost savings, which may take years to demonstrate given the long-term nature of obesity-related complications.