Medicare Part D Spending Trends for Type 2 Diabetes Medications

New diabetes medications are pressuring Medicare Part D financially as they drive up prescription drug costs amid rising rates of type 2 diabetes and obesity. | Image Credit: zimmytws - stock.adobe.com

Medicare Part D faces financial pressure from soaring prescription drug costs, especially for new, high-demand diabetes medications, as the prevalence of type 2 diabetes (T2D) and obesity continues to grow. This trend has prompted calls for increased oversight and scrutiny, according to a data brief from the HHS.¹

FDA-approved diabetes drugs indicated to manage T2D and induce weight loss have seen increased prescriptions and spending in recent years, and Medicare Part D enrollment grew by 12% from 2019 to 2023. Part D spending reflects total program costs, not individual drug prices, and covers FDA-approved prescriptions as mandated by the Social Security Act.

Type 2 Diabetes: Metformin, GLP-1s, and SGLT-2s

More than 38.4 million Americans have diabetes, and this number has more than doubled in the last 20 years, according to the CDC.² T2D accounts for 95% of all diagnosed diabetes cases, and doctors often prescribe metformin as the first-line medication.¹ Metformin lowers the amount of glucose that the liver produces and helps the body respond better to the insulin it makes.

Obesity is a primary risk factor for T2D, oftentimes linked to diabetes cases. More than 42% of adults in the US have obesity, which has led to increasing interest in diabetes drugs that cause weight loss, according to the NIH.³

The FDA approved glucagon-like peptide 1 receptor agonists (GLP-1) drugs for individuals with T2D because they mimic a hormone in the intestines to stimulate the release of insulin and reduce blood sugar after eating.¹ Sodium glucose cotransporter 2 inhibitors (SGLT-2) drugs, another class, may lead to weight loss and improved blood sugar control by causing the kidneys to remove glucose from the body through urine.

Diabetes Drug Spending Under Medicare Part D

Medicare Part D spending for 10 selected diabetes drugs increased from $7.7 billion in 2019 to $35.8 billion in 2023 (364% increase). The audit shows that spending on several diabetes drugs increased significantly from 2019 to 2023, including both versions of semaglutide (Rybelsus and Ozempic; Novo Nordisk), tirzepatide (Mounjaro; Eli Lilly), dapagliflozin (Farxiga; AstraZeneca Pharmaceuticals), empagliflozin (Jardiance; Boehringer Ingelheim), and dulaglutide (Trulicity; Eli Lilly).

Rybelsus, the only GLP-1 oral medication, showed the highest increase during the audit period. In 2019, Rybelsus's inception year, led spending to $366,443 in its first 3 months of coverage. Spending then increased from 2020 to 2023 to almost $1.7 billion —a 2182% increase.

Medicare Part D spending on Ozempic was 16 times greater in 2023 than in 2019. Additionally, spending nearly doubled each year under review. Part D began covering Lilly’s Mounjaro in May 2022, and spending increased 1541% by the following year.

Enrollee, Prescription, and Prescriber Trends for Diabetes Drugs

Medicare Part D enrollees decreased their prescriptions for liraglutide (Victoza; Novo Nordisk), canagliflozin (Invokana; Janssen), and both exenatides (Byetta and Bydureon; Amylin) from 2019 to 2023. This decrease in prescriptions resulted in decreased spending for these same drugs.

The number of enrollees increased their prescriptions for both semaglutide drugs, tirzepatide, dapagliflozin, empagliflozin, and dulaglutide between 139% and 929% during the 5-year period. Enrollees filled fewer prescriptions for liraglutide, canagliflozin, and both versions of exenatide in 2023 than in 2019.

For example, enrollees filled approximately 399 prescriptions for Rybelsus during its first 3 months of coverage in 2019, but by 2023, they filled over 1 million prescriptions. Enrollees filled almost twice as many prescriptions for Ozempic each year from 2019 (523,225) to 2023 (6,933,461), representing a 1225% increase. More providers prescribed either form of semaglutide drugs, tirzepatide, dapagliflozin, empagliflozin, and dulaglutide to Part D enrollees in 2023 than in 2019.

Providers increased their prescriptions for Rybelsus the most, from 17,086 in 2020, its first full year of coverage, to 114,115 in 2023 (568% increase). Providers began prescribing Mounjaro under Medicare Part D in 2022, and 1 year later, they increased prescriptions by 296%. Additionally, fewer providers prescribed liraglutide, canagliflozin, and both versions of exenatide.

Metformin in Medicare Part D

Unlike most of the selected drugs, metformin did not experience an increase in Part D spending. Instead, Part D spending decreased by 5% for metformin, falling from $661 million in 2019 to $628 million in 2023. This contrasts with the 364% increase in Part D spending for the other 10 diabetes drugs mentioned. Although enrollees filled more metformin prescriptions, this increase was at a lower rate than the increase for other selected diabetes drugs.

Enrollees filled approximately 30.5 million metformin prescriptions in 2019 and increased that number to 31.2 million in 2023. Prescribers increased their prescriptions for metformin by 10% during the 5-year period, from 429,457 to 472,367.

Diabetes Drug Demands and Necessary Oversight

While metformin prescriptions fluctuated over the past 5 years, consumers are demanding both GLP-1 and SGLT-2 drugs at a very high rate. Diabetes drugs are currently driving increased health care spending, and Medicare Part D spending for the 10 selected diabetes drugs is expected to continue to increase. If Medicare Part D spending continues to rise at similar rates, the 10 diabetes drugs could cost more than $102 billion by 2026, the authors estimated.

Increases in the use of certain diabetes drugs substantially raised spending, enrollee numbers, prescriptions, and prescriber numbers.

“These increases merit further inquiry to determine whether PDEs [prescription drug events] were paid in accordance with Medicare requirements and whether the associated drugs were utilized for medically accepted indications,” authors concluded.

References

1. Medicare Part D spending for 10 selected diabetes drugs totaled $35.8 billion in 2023, an increase of 364 percent from 2019. Data brief. HHS OIG; February 24, 2025. Accessed February 26, 2025. https://oig.hhs.gov/reports/all/2025/medicare-part-d-spending-for-10-selected-diabetes-drugs-totaled-358-billion-in-2023-an-increase-of-364-percent-from-2019/

2. National diabetes statistics report. CDC. May 15, 2024. Accessed February 27, 2025. https://www.cdc.gov/diabetes/php/data-research/index.html

3. Elmaleh-Sachs A, Schwartz JL, Bramante CT, Nicklas JM, Gudzune KA, Jay M. Obesity management in adults: a review. JAMA. 2023;330(20):2000-2015. doi:10.1001/jama.2023.19897