CMS is no longer moving forward with the Medicare Part D component of the Better Approaches to Lifestyle and Nutrition for Comprehensive hEalth, or BALANCE, Model, according to a memo sent on Tuesday.
Announced in December 2025, the BALANCE Model is a voluntary test to expand coverage of GLP-1 medications for weight management and metabolic health improvement in conjunction with lifestyle changes. The model was to include Medicare Part D plans and state Medicaid agencies, as well as GLP-1 drug manufacturers, Eli Lilly and Novo Nordisk.
CMS planned to launch the Part D portion of the model in January 2027. However, the agency stated in the memo, sent as a Health Plan Management System email, a delay in implementation for calendar year 2027.
The Medicaid component of BALANCE is moving forward, though. The CMS Innovation Center will accept applications from state Medicaid agencies through July 31, 2026, with participants able to start as soon as May 1, according to the memo.
Expanded GLP-1 coverage under the model could benefit millions of Medicare and Medicaid beneficiaries, according to KFF. However, its advantages would depend on state participation and on whether CMS can meet its threshold of at least 80% of Part D sponsors.
The agency had previously indicated that it would not move forward with the BALANCE Model in Medicare next year if participation fell below the threshold.
CMS didn't say in the memo whether concerns about Part D sponsor participation caused the delay in Medicare implementation. However, payers have expressed hesitancy and skepticism regarding the model, citing significant financial risk and uncertainty around the long-term cost of coverage GLP-1s for obesity. As such, major insurers like UnitedHealthcare and Aetna did not commit to participating in the model.
UnitedHealthcare's CEO of government programs, Bobby Hunter, said on the company's earnings call yesterday that it was seeking "a path to yes" for the BALANCE Model but still had questions about its current structure.
"We are still working through that process internally and look forward to continuing the dialogue with CMS," he said. "We provided specific recommendations that we believe would serve all stakeholders well."
Understanding how GLP-1 utilization will change under expanded coverage criteria through BALANCE is a major unknown for potential participants, according to Kirsten Stryker Blasch, an associate principal of policy at Avalere Health.
Expanding coverage for GLP-1s to include weight management is likely to cost up to $47.7 billion, Donnell Folta, principal at Huron's healthcare business, said in a research note. This potential patient population could "overwhelm Part D budgets," she said.
"This might result in increased premiums for all beneficiaries to spread the cost impact across the general population," she stated.
The timing of the BALANCE Model has also been a challenge, Basch explained. Medicare Part D bids for the 2027 plan year are due on June 1, leaving little time to see how GLP-1 utilization would shift under expanded coverage criteria.
"It is also important to note that the BALANCE model is a voluntary model in Part D, meaning that not all plan sponsors were required to participate," she continued. "Given the lack of utilization data and the unknowns around plan participation, it would be difficult for a Part D plan to assess its pricing risk for the 2027 plan year by June 1, 2026."
State Medicaid agencies don't have to contend with the same constraints, added Nicole Letourneau, another associate principal of policy at Avalere Health. Managed care organizations don't face annual rate adjustments or plan bids because they have multi-year agreements with states that blend fee-for-service with managed care.
"The model does provide states and managed care organizations with additional time to expand coverage to beneficiaries enrolled in managed care to ensure managed care policies are aligned with fee-for-service populations," Letourneau continued.
Folta noted that 13 Medicaid agencies have also elected to cover GLP-1s for obesity, although coverage criteria tend to be strict. Meanwhile, federal law prohibits Part D plans from covering medications specifically for weight management.
CMS didn't say when -- if ever -- it plans to revive BALANCE for Medicare. Instead, the memo said it is "pending further evaluation and data collection," which will give "additional time and data to inform the potential implementation of BALANCE in Part D."
Some data, including GLP-1 utilization, will come from the Medicare GLP-1 Bridge program, which is also how Medicare beneficiaries will be able to access GLP-1s for weight management without the BALANCE model, Blasch said.
The Bridge program is a short-term pilot launching in July 2026 to provide eligible beneficiaries with coverage of certain GLP-1s outside of the Part D benefit structure prior to BALANCE implementation. CMS is now extending the program through Dec. 31, 2027, the agency stated in the memo.
UnitedHealthcare will expand GLP-1 access for Medicare beneficiaries through the Bridge program this summer, Hunter said on the earnings call. He thinks participation in the demonstration will help UnitedHealthcare "learn a lot about the best way to advance this priority through that experience."
Additional guidance and stakeholder materials for the Bridge program will become available in the next few weeks, CMS said in the memo. The agency also said it would inform plan sponsors and beneficiaries about "potential future updates" to the BALANCE model if they arise.
Jacqueline LaPointe is a graduate of Brandeis University and King's College London. She has been writing about healthcare finance and revenue cycle management since 2016.
