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The home for VPR's coverage of health and health industry issues affecting the state of Vermont.

Nearly 6 Percent Increase Approved For Blue Cross Customers

The Green Mountain Care Board has approved a 5.9 percent average increase for Blue Cross and Blue Shield customers.

The Green Mountain Care Board has given its approval to a nearly 6 percent rate increase for individual customers of Blue Cross and Blue Shield.

Board chairman Al Gobeille says the rate hike underscores the need to implement a payment reform system in Vermont.

Blue Cross originally filed for an 8.6 percent increase but the board whittled this proposal down to a 5.9 percent increase. The increase is the weighted average of all of Blue Cross policies that are sold on Vermont Health Connect, so individual consumers could see higher or lower rates for their own policies.

Board Chairman Al Gobeille says it was difficult to approve a rate hike that's nearly twice the rate of inflation.

"This is a tough decision and we don't make it lightly. It's not easy to tell people their health insurance is going to rise in costs," Gobeille says.

Gobeille says a large factor in the rate increase is the so called "cost shift." This happens when government programs such as Medicaid and Medicare reimburse health care providers for less than the actual cost of a service. The remaining costs are then shifted onto private insurance premiums.

"This is a tough decision and we don't make it lightly. It's not easy to tell people their health insurance is going to rise in costs." - Al Gobeille, Green Mountain Care Board

"There's a function of commercial prices rising (more) than the government payers and that's some of what you see here," he says. 

Gobeille says he's hopeful that future rate increases will be lower once Vermont adopts a new payment system that emphasizes wellness.

"The way to do that is to work on building an integrated system that focuses on prevention and not treatment... getting to folks before something has gone wrong. So that's the innovation we feel we need to do in Vermont and that's what should help this over time," says Gobeille. 

The board also approved a 2.4 percent increase for customers of MVP health plan, the other major insurer that sells individual policies on Vermont Health Connect. Gobeille says this lower rate reflects the fact that MVP has a healthier customer base than Blue Cross.

Bob Kinzel has been covering the Vermont Statehouse since 1981 — longer than any continuously serving member of the Legislature. With his wealth of institutional knowledge, he answers your questions on our series, "Ask Bob."
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