Self-funded employers can now buy GLP-1s directly from manufacturers, bypassing PBM formulary markups entirely. Platforms like LillyDirect and NovoCare, with care management facilitating direct-to-employer deals through Waltz Health, are putting net-cost prices below what many plans pay after rebates.
That's where the procurement conversation is in 2026. The question isn't whether to cover GLP-1s, most employers have made that decision. If you are, it's who you're buying them from and on what terms.
Key takeaways
LillyDirect and NovoCare let employees access Zepbound and Wegovy at prices that often undercut PBM net cost after rebates, sometimes by thousands per employee per year.
Eli Lilly and Novo Nordisk have both partnered with Waltz Health as of November 2025 to offer GLP-1s (specifically for obesity management) directly to self-insured employers with transparent pricing and integrated clinical support for January 1, 2026 effective dates.
RxSaveCard takes a cash-pay route: it funds GLP-1s through a disease management program with an HRA, carved out from the health plan, at LillyDirect and NovoCare prices plus a small transaction fee. The drug stays off the PBM entirely.
Aon and CVS Caremark launched a hybrid model in February 2026 combining telehealth prescribing, remote monitoring, and split cost-sharing between employee and employer.
Eligibility gating, engagement requirements, and outcomes-based refill terms are becoming standard contract features in direct deals.
The FDA has issued explicit warnings about compounded GLP-1 drugs, making vendor vetting a compliance obligation, not just a preference.
Eli Lilly's oral GLP-1, orforglipron, hit 14.7% mean weight reduction in Phase 2 trials and is expected to gain FDA approval no later than early 2027, which will further pressure PBM injectable formulary arrangements.
What does buying GLP-1s directly from manufacturers actually mean for a self-funded employer?
It means your plan contracts with the manufacturer or a direct-channel platform, not through your PBM's formulary, to supply GLP-1 medications at a fixed, transparent price. According to RxSaveCard's analysis on Relentless Health Value, LillyDirect and NovoCare can save employees thousands of dollars compared to traditional insurance routes through PBMs. For a self-funded plan, that savings flows directly to claims cost.
The structural shift goes further. Broader aggregator platforms like TrumpRx and America's Medicines now work across multiple GLP-1 manufacturers, moving beyond single-manufacturer DTC programs. That's a market-facing pharmacy layer that competes with your PBM's formulary arrangement on price alone.
The manufacturer pricing pressure making this viable is quite welcome. CNBC reported in February 2026 that Novo Nordisk warned of a 5% to 13% sales and profit decline in 2026 due to falling U.S. prices and expiring exclusivity in multiple markets. Manufacturers need volume. Direct employer deals give them that without the PBM margin in the middle.
How do direct-to-employer GLP-1 contracts actually get structured?
The Waltz Health model is the clearest example in market right now, but it feels early, is limited to obesity management only, and I still don't have any personal experience with it. Eli Lilly and Novo Nordisk have both partnered with Waltz Health to offer GLP-1 therapies directly to self-insured employers with transparent pricing and integrated clinical support, bypassing the traditional PBM model entirely.
RxSaveCard runs a different play. It structures GLP-1 access as a disease management or wellness program with an HRA attached, carved out from the health plan. Employees pay cash-pay prices, the same LillyDirect and NovoCare rates, plus a small transaction fee. The HRA reimburses the cost. So the drug never touches the plan's formulary or the PBM. It's funded like a wellness benefit, not a pharmacy claim. That's the appeal. It's also where the compliance questions start.
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The Aon and CVS Caremark hybrid model, launched February 2026, shows what a more structured version looks like. Employees get prescriptions via telehealth, remote monitoring is included, and drug costs are split between employee and employer at discounted rates. Weekly clinical support check-ins are built into the contract. That's outcomes infrastructure baked into the sourcing arrangement.
CMS is doing something structurally similar at scale. The CMS BALANCE model negotiates GLP-1 prices directly with manufacturers on behalf of Medicaid agencies and Part D plans, including negotiating eligibility criteria for patients. That's a federal precedent for direct employer-manufacturer deals that include gating criteria as a contract term, not an HR policy.
What eligibility gating holds up, and what falls apart?
Gating criteria in direct GLP-1 contracts typically require a BMI threshold, usually 30+ or 27+ with a documented comorbidity, a prior authorization tied to a clinical pathway, and ongoing engagement requirements to maintain refill eligibility. These aren't just plan design choices. When they're embedded in the manufacturer or vendor contract, they're enforceable at the dispensing level, not just the claim level.
Engagement requirements showing up in 2026 contracts include mandatory check-ins at 30, 90, and 180 days, biometric reporting, and in some models, participation in a behavioral or nutrition coaching program. Outcomes-based refill terms are now a negotiating point, not an edge case. Continued supply depends on documented progress metrics.
If you're looking at a direct sourcing arrangement that doesn't include these terms, you're buying on price alone, and that's a different risk profile.
Your 2027 formulary design should already have these gates documented. If they're only in your plan document and not mirrored in the vendor contract, you have an enforcement gap.
What are the compliance risks in direct sourcing that employers miss?
The compounded GLP-1 problem is the biggest one. The FDA has issued explicit concerns about unapproved compounded GLP-1 drugs used for weight loss, creating direct compliance and liability exposure for plans that don't vet their dispensing vendors. Any platform that can't confirm it's dispensing FDA-approved branded product is a risk you're absorbing. Don't assume the price is low because the supply chain is efficient.
Vendor vetting isn't optional. Ask every direct sourcing vendor for documentation of their dispensing partner's licensure, state pharmacy board standing, and drug sourcing chain.
The disease management carve-out is its own compliance maze, and it's the one employers underestimate. The RxSaveCard structure, a wellness program with an HRA attached, carved out from the medical plan, is still a group health plan under ERISA. Pulling it out of the plan doesn't pull it out of the rules. The HRA has to satisfy ACA integration requirements. An excepted-benefit HRA carries a low annual cap, and a GLP-1 burns through it fast. Tie eligibility to a BMI number or a comorbidity and you've layered on HIPAA wellness-program rules, the ADA, and GINA. Because the HRA is self-insured, Section 105(h) nondiscrimination testing applies too. None of this sinks the model. It means benefits counsel signs off before procurement does, not after.
The oral GLP-1 pipeline adds another layer of complexity. Orforglipron's expected 2026 market entry means your direct sourcing contracts may need renegotiation sooner than you think.
Frequently asked questions
Can any self-funded employer access LillyDirect or NovoCare pricing, or is there a minimum size?
Both programs are accessible without a strict employee minimum, but the integrated employer contracts through Waltz Health are better suited to groups that can commit to volume and clinical engagement infrastructure. Smaller employers often get better economics through a purchasing coalition or a benefits administrator that has already negotiated a group arrangement.
What happens to PBM rebates if we move GLP-1s to a direct sourcing channel?
You lose the rebate on GLP-1s moved off the PBM formulary. The math only works in your favor if the direct net price beats the PBM net-of-rebate cost. That's not guaranteed across all plan sizes and PBM contracts. Run the comparison with your actual PBM rebate figures before signing anything.
Does moving to direct sourcing create any ERISA or ACA compliance issues?
Not inherently. The plan still covers the benefit. The dispensing channel changes, not the coverage obligation. You'll want your TPA and benefits counsel to confirm the vendor contract aligns with your plan document and that any eligibility gating criteria are applied consistently to avoid discrimination claims.
