The sticker prices of health insurance plans available on Vermont Health Connect will increase next year, but by much less than in recent years.
The average price for plans on the individual market, which covers about 30,000 people in Vermont who are self-employed or work for companies that don’t offer health insurance, will increase between 1% and 10% from last year’s rates, on average.
Plans on the small group market, which covers another roughly 40,000 people employed by small businesses, will go up by less than 5% on average.
State regulators at the Green Mountain Care Board announced the approved rate increases last week for plans offered by Bluecross Blueshield of Vermont and MVP Health Care.
“Our commercial premiums are still really quite too high — we’re still the highest in the country, even after a lower increase this year,” Owen Foster, the chair of the board, said at a press conference Monday.
But they're significantly lower than the rates insurance companies proposed earlier this year before the Green Mountain Care Board reduced them.
“The board took some bold action,” said Mike Fisher, the state’s chief health care advocate. “The other half of the equation is yet to be delivered – we need these rates to be sufficient to keep our carriers in good financial standing, and that really comes down to what the board does on the spending side in the hospital budgets.”
The rates apply to about one-third of the people with commercial health insurance in Vermont. The state does not have the authority to set rates for other commercial plans, such as ones covering school and state employees or for companies with more than 100 workers.
As part of their plan to keep rate increases at a minimum, both insurance companies said they will no longer cover GLP-1 drugs, such as Ozempic and Wegovy, for weight loss next year for any commercial plans. Insurers will also pay less for specialty drugs at many Vermont hospitals when state legislation goes into effect capping hospital drug prices.
Insurance company officials also said they’re worried about being able to cover the cost of care in the state’s hospitals.
“For these premiums to work, they need to pay for all the care that our members will receive in 2026,” said Andrew Garland, the head of external affairs at Bluecross Blueshield of Vermont, in an emailed statement. “We all still have a lot of work to do to get there.”
While the price hikes are less than originally anticipated, many Vermonters who purchase insurance on the individual market are still expected to face major challenges affording their plans.
Federal tax credits called put in place in 2021 that cap how much people pay for premiums based on their income are set to expire at the end of the year. If that happens, costs will more than double for some Vermonters.
People who earn less than 400% of the federal poverty level – about $62,000 a year for a single-person household – will still get some assistance paying for plans. But others would have to pay the full sticker price — more than $1,200 per month for one person this year, on average.
Thousands of Vermonters are expected to forego marketplace plans next year if the subsidies expire and would instead be uninsured. That’s another factor fueling rate increases for next year. Across the country, insurance companies estimate losing these subsidies, called enhanced premium tax credits, will drive rates up 4 percentage points higher than they otherwise would be, according to an analysis by the nonprofit KFF.
Congress has until the end of the year to renew the enhanced tax credits.
