With little fanfare but enormous implications, the Trump Administration is reportedly considering a five-year pilot program to allow Medicare and Medicaid to cover weight loss drugs when prescribed for patients with obesity and related conditions like cardiovascular disease. This decision by the Centers for Medicare and Medicaid Services (CMS), long sought by pharmaceutical companies and obesity advocates, is a watershed moment for access to care. It is also a harbinger of massive fraud.
The GLP-1 class of drugs, which includes brand names like Wegovy, Ozempic, and Mounjaro, has exploded in popularity due to its proven effectiveness in helping people lose weight. The drugs are also among the most expensive on the market, with prices exceeding $1,000 per month. These factors—clinical effectiveness, high costs, surging demand, and now an open spigot of government reimbursement—create an attractive target for abuse.
As lawyers who represent whistleblowers under the False Claims Act (FCA), we expect to enter a new era of fraud cases tied to these medications, with a stratospheric tab for taxpayers. The FCA allows private citizens to bring lawsuits on behalf of the government against those who submit false or fraudulent claims for payment—and GLP-1s are poised to generate exactly that kind of misconduct.
GLP-1s are uniquely susceptible to fraud. They promise rapid weight loss with minimal effort, and many people who fall just shy of CMS’ ultimate eligibility criteria will nonetheless be eager to obtain them, especially if they can do so at low cost through Medicare or Medicaid. What’s more, GLP-1s have massive demand—very few prescription drugs appeal to more than 70 percent of the population. Meeting that demand will take a massive infusion of taxpayer dollars: The government recently estimated that covering GLP-1 drugs for obesity would cost Medicare alone $35 billion from 2026 to 2034.
As a result, providers and clinics may stretch, bend, or outright fabricate diagnoses of obesity or cardiovascular disease to qualify patients for coverage. History tells us this will happen: upcoding, falsified documentation, and medically unnecessary prescribing are well-trodden paths in the annals of healthcare fraud.
Even more concerning is the competitive pressure among pharmaceutical giants to dominate this gold rush. GLP-1s are not interchangeable generics—these are branded, heavily marketed drugs from deep-pocketed global pharmaceutical companies. With the race for market share already on, we expect to see aggressive (and potentially illegal) tactics to induce providers to favor one drug over another, including kickbacks disguised as speaker fees, consulting contracts, and lavish events.
Manufacturers may also push off-label use of these drugs for patients without approved indications—a long-standing problem in pharma marketing that has led to multi-billion dollar FCA judgments in the past. The temptation to blur the lines will be strong, especially as GLP-1s are increasingly hailed not just as diabetes treatments or obesity drugs, but as miracle solutions for everything from heart health to addiction.
We also won’t be surprised to see abuse on the pharmacy and telehealth fronts. Compound pharmacies and online weight loss clinics are already booming thanks to GLP-1s, and some may bill the government for unapproved formulations or skirt required face-to-face evaluations. Expect scrutiny over whether prescribing practitioners are actually evaluating patients or merely rubber-stamping prescriptions based on thin records and virtual checkboxes.
None of this is hypothetical. In the last two decades, whistleblowers have exposed billions of dollars in healthcare fraud—including illegal kickbacks, unnecessary prescribing, off-label marketing, and fraudulent billing schemes—leading to recoveries for taxpayers and safer, more ethical care for patients.
To be sure, the worst-case scenario is not inevitable. CMS could design the pilot program with strong guardrails—tight eligibility verification, rigorous audit protocols, and real-time claims monitoring—to detect and deter abuse before it snowballs. The federal government has, in some areas, gotten better at deploying advanced data analytics to flag suspicious prescribing patterns and identify outlier providers. Drug manufacturers, aware of the scrutiny they already face under the FCA and anti-kickback laws, may tread more cautiously than in past scandals. And many clinicians will follow the rules faithfully, prescribing GLP-1s only to patients who meet clear medical criteria and benefit from them. Effective oversight, coupled with ethical medical practice, could make this expansion a boon to public health without becoming a bonanza for bad actors—but history suggests that such vigilance must be constant, not assumed.
The GLP-1 revolution is here. It may improve the lives of millions. But it will also test the integrity of our healthcare system. Now more than ever, Uncle Sam will be looking for courageous insiders to step forward to ensure that the promise to treat disease doesn’t become an opportunity to fleece taxpayers instead.
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