Vermont's Green Mountain Care Board approves lower rate increases for MVP, Blue Cross Blue Shield

MONTPELIER — State health care regulators have approved rate increases far less than what Vermont's major insurers requested.

The Green Mountain Care Board announced Friday that it approved an individual market rate increase for Blue Cross Blue Shield of Vermont at 9.6%. The company had requested an individual market rate increase of 23.5%. Its request for a small group rate increase of 13.5% was approved at 4.4%.

MVP had requested an individual market rate increase of 6.2%, but was only approved for a 1.3% increase, while its small group rate increase request for 7.5% was approved at 2.5%.

"The GMCB takes seriously its responsibility to protect families and small businesses from unaffordable healthcare costs. I am proud of our work to take a bite of our soaring healthcare costs this year," stated Owen Foster, chair of the Green Mountain Care Board. "At the same time, our decisions protect insurer solvency so they can meet the needs of their members."

He stated that the reductions were possible because of a partnership between the care board, the Legislature, the Office of Gov. Phil Scott, Department of Financial Regulation, Agency of Human Services, and others.

"Today's actions show that, working together, Vermont can make real progress in containing costs at their source while strengthening the long-term stability of our health care system," Foster stated.

According to a news release from GMCB, these rates affect more than 70,000 Vermonters.

The news release notes legislation that impacted the care board's ability to reduce the requested rates: Act 49, which gives the care board authority to reduce hospital prices when there's a threat to an insurer's solvency; Act 55, which caps hospital drug prices; and Act 68, which requires the Agency of Human Services to reduce hospital spending by at least 2.5% in 2026. The act also requires the care board to use reference-based pricing.

The news release also notes an order from the Department of Financial Regulation that makes insurance companies do more to control costs in their hospital contracts.

The Green Mountain Care Board stated that federal assistance on health care premiums for the individual market will decrease in 2026 and that people on those plans should review their options on the Vermont Health Connect website.

GMCB stated that insurers were required to lower their assumptions about hospital prices, which the board also regulates.

Foster stated at a press briefing on Monday that the insurance companies have the right to appeal these decisions though none have given the care board any feedback yet in that regard.

He said that all told the difference between the rates requested and the ones approves amounts to about $68.8 million.

"Vermont should compare quite favorably to regional and national peers in terms of the level of rate increase people will experience this year," he said.

Foster said that per the board's published findings, it found that rate decisions were being seen by insurers as entitlements rather than caps.

"Second, some hospitals were treating the budget decisions by the board as a revenue guarantee, such that if there was systemic incorrect billing, hospitals would request the insurer make up for those reductions by increasing payment elsewhere. That really effectively nullified some of the insurer's ability to reduce costs for their members," he said.

Foster said high-cost services were also seeing a corresponding increase in utilization.

According to Foster, the board also found that BCBSVT was losing money on a number of insurance products.

Third, there were findings about hospitals increasing rates on some services far higher than the care board approved rate increase and having in some instances a corresponding spike in utilization.

"Blue Cross remains in a difficult position financially, but so do Vermonters and the board's responsibility is to balance those competing interests. At the end of the day, we concluded that allowing these rate increases would be very detrimental to people's ability to access care and that the status quo of double-digit rate increases was not acceptable," he said.

He said that the board also looked at executive compensation, and as with hospitals found them out of line with the state's goals for health care reform.

"As health care costs rise nationally, MVP is proud to be part of the solution in Vermont — working collaboratively with regulators, providers, and community partners to ensure coverage remains within reach for individuals and small businesses alike," stated Jordan Estey, vice president of government affairs at MVP Health Care. "We recognize the financial pressures many Vermonters face and are dedicated to delivering value through innovative care models, preventive health initiatives, and personalized customer support. Our goal is not only to provide coverage but to empower healthier lives across the state."

Andrew Garland, a spokesperson for BCBSVT, stated that Act 55 will save Blue Cross members millions of dollars.

He stated that the QHP Risk Adjustment program for 2024 was adjusted and showed Blue Cross has many high-risk members. "As a result, we will receive a bigger risk transfer payment from MVP than was estimated at the time the rates were filed," he stated.

He stated that the care board is looking at hospital budgets and depending on how that goes will determine if the insurance rates are adequate.

"We're very supportive of the GMCB's and the Department of Financial Regulation's efforts to bring down the cost of care. Affordability matters. For these premiums to work, they need to pay for all the care that our members will receive in 2026," he stated. "Our members are using a lot of expensive healthcare, and we know from looking at national data that the cost of that care here in (Vermont) is quite high. As a community, we have to pull together and address the cost of care at our local hospitals."

keith.whitcomb

@rutlandherald.com