Are weight loss treatments the new battleground for talent retention?
As demand, cost and claims continue to surge for GLP-1 weight loss drugs, employers and insurers alike are being pushed to consider whether these medications belong in employee benefits packages.
As Peter Ricci emphasized, Co-operators “firmly believes in weight management drugs. We offer these to any plan sponsor that wants to cover these products for plan members," he said.
Ricci doesn’t mince words about his stance. Not only does Co-operators include GLP-1s in plans when requested, it also removes many of the administrative hurdles typically associated with these medications.
"I hate forms. I hate having to interpret a form. I hate making plan members fill out forms," he said. "It costs a lot of money to fill out a form and you have to miss a day of work to go get a form filled out, which is absolutely bonkers," said Ricci, manager of pharmacy programs at Co-operators.
He argues that if employers truly support access to weight loss medications, they should include them in the core benefits package rather than relegating them to health spending accounts. He sees the latter as too vague and unaccountable.
“A health spending account is just like a general slush fund,” he said. “You wouldn't be able to track how that's being spent.”
By contrast, including GLP-1 drugs in the main benefits plan offers transparency and sends a stronger message about the employer’s commitment. Ricci believes this approach also yields long-term business advantages like decreased absenteeism, possibly decreased disability along with more productivity.
While he acknowledged that not all employees have the same health needs, especially when some may be younger, healthier, and less concerned about medical coverage. That variability, he says, requires employers to think creatively about how they structure benefits.
“It’s hard to know what people want and need when you’re fit, young, and healthy. You don’t think of other things,” he said.
To address this, Ricci points to flexible benefits models as a solution. Co-operators recently introduced a flex package allowing employees to tailor coverage based on personal needs, he explained, adding this kind of customization can meet a broader range of preferences.
Ricci also points to systemic bias embedded in traditional coverage criteria, particularly the reliance on BMI scores.
“Bias comes from some of these forms where we have to measure body mass index, (BMI), which is actually only validated in white European males,” he noted, arguing that using outdated and non-inclusive metrics contributes to inequitable access to treatment.
While he acknowledged the Canadian market isn’t fully there yet, Ricci believes Co-operators is tackling both stigma and structural barriers. Demand is rising, he said, and these drugs are taking up a growing share of benefit plan spending.
At Co-operators, these medications are made available to any plan sponsor that chooses to include them, explained Ricci. When it comes to type 2 diabetes treatments like Ozempic and Monjaro, he explained that the insurer has developed an AI-driven step therapy system that approves coverage automatically based on claims history, minimizing administrative delays. If the AI doesn’t confirm eligibility, a prior authorization is then required.
However, the company takes a different approach for individuals seeking weight loss medications without a diabetes diagnosis. Ricci emphasized that Co-operators deliberately removes barriers to access.
“If you need this medicine, we will happily cover it on your plan. We cover the products up to a plan limit based on the plan parameters, if the plan sponsor is agreeing to pay for these products. We think that these drugs can help people in the long term, can help to increase rates of being at work, rates of being at work productively as well. They increase productivity. They decrease things like absenteeism, maybe even decrease things like disability leave. So they're wonderful drugs. We believe in them,” said Ricci.
His approach clashes with the traditional stance of many benefit providers, which often treat these drugs as elective or non-essential. Yet, interest from employees is rising sharply. A recent US-based survey cited during the conversation found that one-third of millennials and Gen Z respondents would prefer GLP-1s as their primary weight loss tool, while more than one in four said they’d be more inclined to accept a job that offered access to these drugs.
Ricci agrees with the direction this is heading. He believes the inclusion of weight loss medications in benefits plans is gaining momentum and will likely become standard over time. He recalled how these drugs were once considered taboo, not just medically, but administratively, due to the burdensome approval process.
In response, Co-operators eliminated those hurdles, removing prior authorization requirements to streamline access and trust both the patient and their prescriber.
Still, Ricci admits there are financial risks in the short term when adding weight loss drugs to a benefits plan, mainly due to increased upfront costs. But he argues the long-term payoff - through higher productivity and a more engaged workforce - makes it worthwhile, while also highlighting a potential cost-saver on the horizon.
While the exact timing is uncertain, Ricci emphasized ongoing discussions of a generic version of Ozempic launching in Canada within months.
“It will eventually happen,” he said.
That’s why he often encourages employers to ensure their plans are set up for generic pricing, as this would allow them to take advantage of immediate savings once the generic hits the market, possibly at 40 per cent to 85 per cent of the cost of the brand name.
Ricci underscored that interest in covering weight management drugs is growing across most of Co-operators’ group plans and those that have adopted coverage are showing strong satisfaction, noting that Co-operators currently retains 92 per cent of its client groups year over year, a figure he considers high for the industry.
He ultimately believes the real value in covering weight loss medications lies in workforce stability and long-term productivity gains. High turnover, he said, is expensive and disruptive, but offering meaningful benefits can help prevent it.
“If you can keep your employees happy and not have that churn, you have productive workforces,” he said. “It's a long game. Invest in the workforce now to have the dividends pay off later.”
