Gov. Gavin Newsom proposes ending Medi-Cal coverage of weight loss drugs like Ozempic and Wegovy to address rising costs and a growing state budget deficit.
Governor Gavin Newsom has proposed removing weight loss drugs like Ozempic and Wegovy from Medi-Cal coverage. This change would start on January 1, 2026, and aims to help the state control its growing healthcare costs.
Ozempic and Wegovy are expensive and widely used. Medi-Cal is the health insurance program for low-income Californians. The proposal would save California $85 million in 2025–26 and as much as $680 million by 2028–29, according to state estimates.
The state faces a $12 billion budget shortfall. Lawmakers are reviewing the governor’s plan as part of their larger effort to close this deficit.
If the change is approved, low-income patients would need to pay for these drugs themselves. The cost is over $1,000 per month, which many cannot afford. Doctors say this could be harmful, as obesity leads to other illnesses like heart disease and diabetes.
Dr. Wayne Ho, a Los Angeles physician, said these drugs help patients reduce blood pressure and cholesterol. He called them the best tool in his work as a primary care doctor. He also warned that low-income patients already struggle to get good food and medical care, making this decision even harder on them.
Health advocates like Liz Helms, president of the California Chronic Care Coalition, criticized the plan. “This is a bad decision,” she said. “What happens to people already using these medications?”
California has no federal requirement to cover these drugs in Medi-Cal. The state added them by choice. If Ozempic is prescribed to treat diabetes, Medi-Cal would still cover it.
Prescriptions for these drugs have grown fast. From 2022 to 2023, Wegovy prescriptions under Medi-Cal rose from 15,000 to 181,000. Ozempic prescriptions increased from 178,000 to 480,000 in the same period. In 2023 alone, Medi-Cal spent about $733 million on both drugs.
As drug spending grows, the state is looking to make cuts. Medi-Cal spent $15.2 billion on drugs in 2023–24, a 10% jump from the year before. This rise, along with Medi-Cal expansion to undocumented immigrants, led to a $6.2 billion budget gap earlier this year.
Newsom’s budget also proposes freezing Medi-Cal enrollment for undocumented immigrants. Medi-Cal currently serves almost 15 million people across California.
Ozempic is used to treat Type 2 diabetes, but many doctors also prescribe it for weight loss. Wegovy is only for weight loss. Both drugs are made by the company Novo Nordisk and do not have cheaper generic versions.
The active ingredient in both drugs is semaglutide. It mimics a natural hormone that controls blood sugar and appetite. Medi-Cal already limits how much Wegovy can be given each month—only one carton of four pens for weekly use.
To qualify for Medi-Cal, a person must earn less than $21,597 per year. For a family of four, the income limit is $44,367. With such low income levels, losing drug coverage could have serious impacts for many Californians.
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