Weight-Loss Drug Cases Push to Recognize Obesity as Disability

A series of state and federal lawsuits challenging coverage exclusions for obesity drugs and procedures are testing the bounds of what qualifies as a “disability” under discrimination laws as more workers seek to access the expensive treatments.

Public school district employee Rebecca Holland sued Elevance Health, Inc. on Sept. 20 over the insurance company’s exclusion of obesity treatments under the Maine Education Association Benefits Trust Plan. The fully insured plan does not cover popular, pricey GLP-1 weight loss drugs, and limits bariatric surgery to individuals diagnosed with “severe obesity” after a five-year waiting period, according to the proposed class action complaint.

It’s one of a new line of cases filed by the Seattle-based firm Sirianni Youtz Spoonemore Hamburger PLLC against insurers like Elevance, Cigna Health and Life Insurance Co., and Regence BlueShield arguing that the exclusions amount to disability discrimination under antibias laws like Section 1557 of the Affordable Care Act. The lawyers are testing the law in several ways through cases against fully insured and self-insured plans, private and public companies, and under both federal and Washington state law.

The plaintiffs include a Maine university worker, a public hospital employee, and a woman seeking a gastric bypass to treat a stomach acid issue worsened by a previous gastric sleeve procedure.

Around 40% of Americans are considered obese, and the cost of the new drugs is straining health care budgets. Novo Nordisk’s drug Wegovy—the cousin of its diabetes drug Ozempic— has a list price of $1,349 a month, while Eli Lilly & Co.’s weight loss drug Zepbound retails for $1,049 a month. Discounts negotiated with pharmacy benefit managers typically lower list prices by 40% to 50%, but the final tab still causes companies and regulators concern.

Plaintiffs in the two Washington state cases are suing under the Washington Law Against Discrimination, which includes obesity in its definition of disability thanks to a 2019 state Supreme Court ruling in Taylor v. Burlington Northern Railroad Holdings. The court concluded that obesity always qualifies as an impairment because the medical community recognizes it as a physiological condition.

But courts have not yet drawn the same conclusion under the federal Americans with Disabilities Act. Holland did not bring her claim under the ADA, but the law provides a basis for federal courts’ analyses of a worker’s disability status.

“That’s a preliminary hurdle in a federal case right now, and I’m not sure that the plaintiff’s complaint has met that standard,” said Laura Hermer, a professor at the Mitchell Hamline School of Law.

At least four appeals courts have concluded that workers need to prove their obesity has an underlying physiological cause in order to even bring an ADA claim.

Holland’s complaint details the medical effects of obesity, including her sleep apnea, high cholesterol, and foot and shoulder injuries, which improved while she was paying out-of-pocket for cheaper versions of the obesity drugs. Holland was also diagnosed with a binge-eating disorder, which could elevate her argument under the ADA’s more narrow threshold.

“The addition of that is savvy,” said Katherine MacFarlane, director of Syracuse University College of Law’s Disability Law and Policy Program. “It strengthens her case to the extent that they’re in front of a court that’s looking for an underlying condition as well.”

Changing Attitudes

The lawsuits seek to align insurance coverage with clinical guidelines from physician groups like the American Medical Association, which in 2013 recognized obesity as a “disease state with multiple pathophysiological aspects requiring a range of interventions.”

But existing case law does not recognize obesity broadly as a disability. In the separate case of Whittemore v. Cigna Health and Life Insurance Co., Cigna argues that threshold has not been met. The insurer also alleges the plaintiff is asking to categorize all obese people as disabled, which it argued was unreasonable because it could put an estimated 40% of the US population in that protected group.

Cigna additionally argued that the plaintiff had not shown it had intentionally discriminated against her. The policy did not create a disparate impact on obese plan participants either, since it also applies to those who are simply overweight, Cigna said.

Cigna is overstating the courts’ views under the US Court of Appeals for the First Circuit, according to MacFarlane. She pointed to the 1992 case of Cook v. Rhode Island, where the U.S. District Court for the District of Rhode Island suggested that no separate physiological diagnosis is needed for obesity to qualify as a disability. A longstanding tenet of disability law also requires case-by-case analyses, she said, rather than broad categorizations.

“I think the defendants are both misstating the plaintiff’s position and also overstating what federal courts have held in the context of obesity as a disability,” she said.

Federal courts’ view of obesity is less settled, according to Kara Backus, who works with employers on benefit plans as a shareholder with Lane Powell. But changing attitudes and increasing coverage of obesity drugs could aid the plaintiffs’ argument.

A May 2024 survey from the International Foundation of Employee Benefit Plans found that 34% of employers covered GLP-1 drugs, up from 26% in 2023.

“That trend toward recognizing obesity treatments as sort of something that occurs in the normal course, I think would sort of tend to support the argument that this is something that people consider as a medical condition that should be covered,” she said.

A new rule further strengthening discrimination standards under the ACA’s Section 1557 will make it easier for the plaintiffs to plead their case, but doesn’t solve their challenges under federal law, Hermer said. The antidiscrimination provisions will apply to plan design next year for insurance companies acting either as insurers or third-party administrators under a rule finalized in April (RIN 0945-AA17). But plans are still often allowed to make design choices around cost savings, for example.

“Then they’re not going to succeed because there are safe harbors for insurance plans to make decisions about plan design that are not due to discrimination,” she said.

The arguments reflect similar Section 1557 assertions in the realm of IVF benefits for LGBTQ+ couples, after the American Society for Reproductive Medicine revised its definition of “infertility” in 2023 to include sexual orientation. And they parallel trends in mental health and gender dysphoria coverage, lawyers said.

Employers rarely get in the weeds on what individual drugs their plans cover, Backus said, but obesity drugs are so popular and expensive that they can be an exception, so companies need to “be careful.”

“There’s just been so much activity under 1557, and I just wonder what else might be coming,” she said.

The case is Holland v. Elevance Health Inc., D. Me., No. 2:24-cv-00332, Complaint filed 9/20/24.