Treasurer's office announces transition of retired teachers' Medicare coverage

MONTPELIER - The Treasurer's Office announced that starting in calendar year 2026, the State's retired teachers currently receiving health insurance from Vermont Blue Advantage (VBA) will be covered by equivalent plans provided by HealthSpring.

The decision to switch providers was made after VBA proposed a near-50 percent rate increase for CY2026, despite agreeing to a 10 percent cap rate increase in their contract with the State. By moving to HealthSpring, premium rates will only increase 16.2 percent this January.

The change will impact over 7,000 retired teachers and beneficiaries in Vermont who currently receive their health insurance from VBA. Retiree enrollment will automatically be transferred from VBA to HealthSpring starting Jan. 1, 2026, and retirees will maintain their current level of benefits. Treasurer Mike Pieciak emphasized that the transition will keep health care affordable and accessible for Vermont's retired teachers. "This change protects the benefits our retired educators have earned through their lifetime of service to our state, ensuring they can continue to afford the care they need. As rising health care costs push Vermonters to the brink, we will look for every opportunity to save our retirees money while maintaining excellent benefits."

The Treasurer's Office secures health insurance for retired teachers, with costs shared between retirees and the State. Benefits are administered by the Treasurer's Office Retirement Division, which is overseen by the Vermont State Teachers' Retirement System (VSTRS) Board of Trustees.

After VBA presented their proposed CY2026 rate increase in July, the Treasurer's Office immediately initiated a bid process to determine if the State could secure the same or better coverage at more affordable costs. After reviewing multiple propos als with the assistance of an expert consul tant and earning approval from the VSTRS Board of Trustees on Sept. 11, the State intends to move forward with coverage from HealthSpring.

HealthSpring, a national provider owned by Health Care Service Corporation (HCSC), brings years of Medicare Advantage experience to Vermont's retired teachers. They currently serve over four million Medicare customers nationwide, including Vermont State College retirees. The Center for Medicare and Medicaid Services rates HealthSpring 4 out of 5 stars, indicating their members receive strong service, care, and customer support. That rating also enables HealthSpring to secure additional federal subsidies.

While retirees transitioning from VBA to HealthSpring will see a rate increase, the change will save members hundreds- if not thousands- annually compared to remaining with VBA, depending on their individual subsidies. HealthSpring has also agreed to cap rate increases for the next two years, ensuring costs remain affordable for retirees and the State going forward.

The Treasurer's Office and HealthSpring will hold a series of in-person and virtual public meetings to answer questions and help VSTRS members better understand the upcoming transition. Dates and locations will be announced.

Members can learn more on the upcoming transition at https://www. vermonttreasurer. gov/ vstrs or contact the Treasurer's Office Retirement Division directly at (802) 828-2305 or Tre.RetirementOffi [email protected].