Vermont’s benchmark health insurance premiums are the highest rate in the nation. They’ve more than doubled since 2018. Yet the state’s hospitals are on an trajectory to ‘negative operating margins,’ a report commissioned by the Green Mountain Care Board (GMCB) said.
The report was aired when the Green Mountain Care Board held a comprehensive statewide healthcare community meeting August 5 to address Vermont’s pressing healthcare challenges. The meeting focused on finding solutions to the problem of unsustainable and unaffordable health care, as required by the Legislature’s Act 167 (2022).
GMCB retained Oliver Wyman LLC and Dr. Bruce Hamory to execute on Act 167’s mandates. On Monday evening, Dr. Hamory and his team presented their year-long study, highlighting the critical issues of affordability, accessibility, and sustainability in Vermont’s healthcare system and the immense challenges Vermont’s aging demographics pose to the sustainability of Vermont’s healthcare system.
Hamory underscored the high healthcare costs in Vermont, with premiums and out-of-pocket expenses significantly impacting families and employers. Hamory’s team projected that based on 3.5% hospital revenue growth and 5% cost growth, in five years, nearly all Vermont hospitals will have negative operating margins. The benchmark Silver Plan Blue Cross-Blue Shield premium in Vermont has risen 108% since 2018 and is the highest in the nation.
Hamory also presented information indicating that Vermont’s non-profit insurance companies are facing serious financial challenges and have lost significant reserves, creating solvency concerns. Hamory emphasized that systematic changes are needed to ensure the sustainability of Vermont’s healthcare system and to protect Vermonters from the rapid growth in healthcare costs.
“Nationwide, rural hospitals are losing money, cutting services and closing at an alarming rate, thrusting the communities they serve into crisis,” said GMCB Chair Owen Foster, “We don’t want to see that chaos happen in any community in Vermont. To prevent this, we’ll need to be proactive and bold. Vermont has a tremendous opportunity that allows us to design a durable system that is responsive to our changing demographics.”
“The rising cost of healthcare in Vermont is a critical affordability issue of our present,” said Brendan Krause, Director of Healthcare Reform at the Vermont Agency of Human Services. “While the challenge is real, we have an opportunity to explore innovative ways to transform our system to better serve the healthcare needs of Vermonters, while keeping care affordable.”
Public comments and questions were welcomed, with participants sharing their experiences and concerns about the current state of healthcare in Vermont. The meeting also highlighted the importance of supporting long term care, home healthcare, primary care and mental health services, as well as the need for administrative efficiency and collaboration among healthcare providers.
The Agency of Human Services will take the lead on hospital transformation with the support of the Green Mountain Care Board. Oliver Wyman’s full report will be released and available to the public in September.
The Green Mountain Care Board (GMCB) is a 5-member, independent Board with a vision of a sustainable and equitable healthcare system that promotes better health outcomes for Vermonters. The GMCB was created in 2011 with an ambitious mission to drive system-wide improvements in access, affordability, and quality of healthcare to improve the health of Vermonters. Through public meetings, the GMCB ensures a transparent approach to healthcare regulation and a voice for stakeholders, including healthcare organizations, clinicians, and members of the public. With a holistic, data driven approach, the GMCB carries out its regulatory duties, supports innovation in healthcare delivery and payment reform, and serves as an important resource for independent, transparent analyses of Vermont’s healthcare system performance.
This news article was edited from a Green Mountain Care Board press statement.