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SB 876

Maryland Medical Assistance Program - Coverage for the Treatment of Obesity

2025 Regular Session Introduced by Steve Hershey and 1 co-sponsor

MD Medicaid must cover comprehensive obesity treatment (behavioral therapy, bariatric surgery, FDA-approved meds) starting July 1, 2026; MDH must notify recipients.

Hearing 3/04 at 1:00 p.m.
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Bill Summary · SB 876

SB 876 — Maryland Medical Assistance Program: Coverage for the Treatment of Obesity

Status: Hearing scheduled 3/04 at 1:00 p.m. (Introduced January 22–28, 2025)

Purpose

Require the Maryland Medical Assistance Program (Medicaid) to provide comprehensive coverage for the treatment of obesity, and require the Maryland Department of Health (MDH) to notify Medicaid recipients about the coverage.

Key provisions

  • Coverage requirement (effective dates in bill text):
    • The Program must “begin” providing comprehensive obesity treatment coverage on July 1, 2026 (bill text).
    • The Act’s effective date in the bill text is October 1, 2025; MDH must notify recipients by June 1, 2026.
  • Definition of “comprehensive coverage for the treatment of obesity”:
    • Includes intensive behavioral therapy, bariatric surgery, and any medication approved by the U.S. Food and Drug Administration (FDA) with an indication for chronic weight management in patients with obesity (termed “FDA‑approved anti‑obesity medication”).
  • Coverage criteria limits:
    • Coverage criteria for FDA‑approved anti‑obesity medications may not be more restrictive than the FDA‑approved indications for those medications.
  • Utilization management:
    • The Program may use utilization management (e.g., prior authorization) to determine medical necessity and appropriateness only if applied in the same manner as for other illnesses/conditions covered by Medicaid.
  • Notice requirement:
    • MDH must provide written notice to Program recipients of the new coverage and prominently position that notice in literature/correspondence about available coverage in calendar year 2026.

Who is affected

  • Primary: Maryland Medicaid enrollees with obesity (the bill explicitly covers ages 12–64 in fiscal projections).
  • Secondary: Maryland Medical Assistance Program budget and administration, MDH staff, Medicaid pharmacy benefits manager (PBM).
  • Local governments and small businesses: no direct fiscal effect reported.

Fiscal impact (summary from Department of Legislative Services / MDH analysis)

  • MDH can produce required notices with existing FY2026 resources.
  • Estimated net Medicaid expenditure increase in FY2027: $225.8 million total (58.9% federal funds; 41.1% general funds). Federal fund revenues increase accordingly.
  • Additional administrative costs (FY2027): $882,483 (50% GF / 50% FF) to hire 2 pharmacists and 1 physician program specialist and for PBM contractual costs.
  • Underlying assumptions used for prescription‑drug cost estimate:
    • Projected Medicaid enrollment (FY2026): 1,240,000.
    • Estimated eligible obese Medicaid participants (ages 12–64): 401,223.
    • Uptake assumption (base case): 15% prescribed medication (60,183 people).
    • Average monthly drug cost: $1,292; average months on drug per year: 5.3 → total months 321,120.
    • Gross drug cost $414.9M; after current utilization and rebates, net increase ≈ $225.0M (FY2027).
  • Sensitivity:
    • If uptake = 5% → ≈ $75.0M cost.
    • If uptake = 25% → ≈ $437.7M cost.
  • The fiscal note does not include potential long‑term savings from reduced chronic disease burden attributable to weight loss (not reliably projected).

Context and related items

  • Maryland already covers bariatric surgery and intensive behavioral therapy for qualifying enrollees; current anti‑obesity medication coverage is limited to certain comorbidities.
  • MDH completed a December 2024 report per 2024 legislation studying Medicaid coverage of obesity treatment; that report informed the fiscal estimate.
  • Federal context: a November 2024 proposed CMS rule would reinterpret federal prohibitions on coverage of “agents used for weight loss” to permit coverage of anti‑obesity medications for individuals with obesity; federal action could affect program obligations.

If you want, I can produce a one‑page factsheet focused on budget impacts or draft talking points summarizing pros/cons for stakeholders.

Compiled from official sources — confirm details with the bill’s official record.

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