On April 9, 2025, in Holland v. Elevance Health Inc., a U.S. District Court in Maine granted a motion to dismiss a putative class action against Elevance Health Inc., which designs and administers a fully insured plan for the Maine Education Association Benefits Trust (MEABT). The plaintiffs in the case alleged that a coverage exclusion for weight-loss medications was a form of disability discrimination in violation of Section 1557 of the ACA, which prohibits discrimination in certain health programs and activities on the basis of race, color, national origin, sex, age, or disability if the program receives federal financial assistance.
The defendant argued that the coverage exclusion applies equally to all participants, regardless of disability status, noting that the exclusion applies to overweight individuals, obese individuals who are not disabled, and obese individuals who are disabled. The court sided with the defendant, holding that the coverage exclusion does not turn on disability status, impacts participants whether they are disabled or not, and does not isolate disabled participants for discriminatory treatment. The court cited the fact that MEABT had a choice as to whether to include weight loss drugs in the plan, and noted that the exclusion for weight loss drugs is consistent with a similar exclusion under Medicare Part D. The court ultimately found that the discrimination allegations were "conclusory and conjectural," and the complaint did not support a sufficient finding that the defendant had ever regarded the plaintiffs as disabled (which would be necessary to support a discrimination claim under the ACA).
Employer Takeaway
While the court’s decision is welcome news to employers and health plans as they continue to manage the growing demand for GLP-1 and similar weight-loss drugs, the case did not address other potential areas of liability under HIPAA nondiscrimination rules, the ADA, and GINA. As courts continue to grapple with the scope and applicability of nondiscrimination laws, employers should closely monitor legal developments surrounding the issue and proceed cautiously when evaluating coverage restrictions for these types of medications. The growing number of legal challenges involving coverage for weight-loss medications has reinforced the need for employers to consult with legal counsel when considering any changes to their plan’s treatment of these drugs.