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BlueCross BlueShield of Vermont − the largest health insurer in Vermont with a 66% market share − is threatened with insolvency because of its declining reserves, according to a state regulator.
Kevin Gaffney, commissioner of the Vermont Department of Financial Regulation, said Friday he’s confident BCBSVT will remain solvent, which is his department’s responsibility to ensure.
“As solvency regulator, our primary role is protecting the market,” Gaffney said. “We have to have a place for people to purchase insurance or we haven’t done a good job of protecting Vermont residents.”
Gaffney said Vermont’s largest health insurer is at a critical juncture.
“BlueCross BlueShield of Vermont is a big tanker,” he said. “We have to start to turn it. We can do that and there are steps to do it.”
While Vermont has not had a major insurance company fail, according to Gaffney, he said the example of Florida offers a cautionary tale where losses from natural disasters have caused insolvencies in property insurance companies and have triggered other insurance companies to exit the market.
“We have sufficient rigor in our solvency process to avoid these things,” Gaffney said. “DFR is taking those actions in a timely and I think in an appropriate manner.”
Gaffney is requiring BCBSVT to file a plan with DFR by early September, showing how they’re going to “bolster their reserves and improve their solvency.” The key element of that plan, articulated in a “solvency letter” Gaffney sent to Owen Foster, chair of the Green Mountain Care Board, on July 12, is an additional 4% increase by BCBSVT in contributions to its reserve fund.
The Green Mountain Care Board is an independent oversight board created by the Vermont Legislature to regulate major areas of the health care system in the state, including health insurance premiums. The Care Board would have to approve the increased contributions to BCBSVT’s reserve fund.
Don George, president and chief executive officer of BCBSVT, sent an open letter via email on Monday, July 22, titled, “A Fragile Financial Situation.” In the letter, George said the insurer is in the “unprecedented position” of being forced to file an amended request to the Green Mountain Care Board for an additional 4% increase to contributions to its reserve fund, which comes from premiums paid by policy holders. The reserve fund is used to cover unexpected levels of claims, which the insurer has experienced in the past few months.
“Since May, health care claims have increased dramatically, and our member reserve levels have declined precipitously,” George said. “This is in addition to underwriting losses in five of the last six years, leaving us without the means to weather this downturn with existing member reserves. The cumulative impact of underfunded premiums − despite our consistent advocacy for rates that fully fund the cost of our members’ health care − has created this fragile financial situation.”
Sara Teachout, director of government and media relations for BCBSVT, explained that underwriting losses occur when the company is unable to cover the total amount of member claims plus administrative costs. She said administrative costs for BCBSVT are “quite low,” when compared to its peers nationally, but the insurer is still making administrative cuts by not advertising and by restricting new hiring.
“The only year we did not have a loss was 2020, the year of COVID, when people were not going to the hospital,” Teachout said.
The original request for contributions to the reserve fund, filed in May, asked for a 3% increase, which equates to $15 million. The amended request for a 7% increase equates to $35 million, or more than double the original request, according to Teachout.
“Blue Cross VT has advocated for adequate funding of member reserves consistently over time, while our requests were cut year over year,” George said in an email to the Burlington Free Press. “Now with member reserves dangerously depleted, we are forced to increase the rates substantially to cover the deficit.”
Owen Foster, chair of the Care Board, declined to comment for this story because the hearings for BCBSVT’s rate filings are ongoing.
Gaffney said the reserve fund is “critical” to maintaining BCBSVT’s solvency. He said the health of the reserve fund can be expressed as a percentage − called a risk-based capital ratio range − reached through complex calculations that reflect BCBSVT’s investment risk, but basically the percentage equates to an amount of money that accounts for “volatility.”
“The (DFR) did an order back in 2019 for Blue Cross Blue Shield of Vermont to maintain a risk-based capital ratio range between 590% and 745%,” Gaffney said. “If you can stay in that range you can withstand volatility and not be at risk (of insolvency).”
At the end of 2023, BCBSVT’s risk-based capital ratio range was 337%, far below the required range. Gaffney said in six of the last 10 years, the insurer’s contribution to its reserve “was a negative because of other adjustments to rate filings.” Rates are regulated by the Green Mountain Care Board.
“It is as dire as it sounds,” Gaffney said.
BCBSVT’s reserve fund balance has declined by $47 million over the past two years, not including this year’s results, according to Gaffney. The insurer had about $88 million in reserves at the end of 2023, and that number has continued to decline through 2024. Teachout was unable to provide the current balance of the reserve fund.
“We do know the 2023 number was only adequate to cover just under two months of our members’ claims, which is extremely low,” Teachout said. “We should roughly double where we are. Our balance should have been close to $180 million at the end of 2023.”
The overall context for the discussion of BCBSVT’s solvency is a crisis of health care affordability for Vermonters, both in terms of hospital costs and premiums. Gaffney said he’s not unsympathetic to the affordability issue, but that he has a larger responsibility as commissioner of DFR, and BCBSVT’s solvency regulator.
Gaffney said he also understands that “often it’s felt that these increases are to just bolster profits for insurance companies.”
“That’s not the case now,” he said. “It’s going to take some time to get back into the range of 590% to 745%.”
George points to the declining health of Vermonters as a key factor in BCBSVT’s financial crisis, in addition to rising hospital costs. He said health care organizations nationwide are experiencing “extraordinary cost pressures,” as a result of “massive increases in the need for medical and pharmaceutical care.”
“As many of you may have experienced in your own lives, we are faced with these same pressures here in Vermont,” George said. “Furthermore, our data shows the continuing impact of the pandemic and an alarming decline in the overall health status for many of our members. These issues are colliding with a decade of state policy decisions to cut deeply into health insurer reserves and premiums in the name of affordability, creating the urgent situation that we are faced with today.”
Not only are there more claims, but there are bigger claims from more acute medical conditions, Gaffney said.
“The takeaway is the price of insurance is a reflection of costs, not a choice the company makes,” he said. “The company runs on narrow margins.”
Contact Dan D’Ambrosio at 660-1841 or ddambrosio@freepressmedia.com. Follow him on Twitter @DanDambrosioVT.
MONTPELIER, Vt. (WCAX) – Most Vermont school budgets passed Tuesday, but 19 districts and supervisory unions saw their spending plans rejected — an uptick from the nine that failed in 2025, though well below the 29 that failed in 2024.
Some education leaders say the results show communities are largely supportive of their schools.
“We’re starting to kind of equalize out again towards the normal trend of passage of school budgets each year,” said Chelsea Meyers of the Vermont Superintendents Association.
Sue Ceglowski of the Vermont School Boards Association said the results send a clear message. “Vermont taxpayers support Vermont’s public schools,” she said.
Meyers said the results also raise questions about the scope of education reform being considered in Montpelier. “If we are going to reform the system, it might not require sweeping broad changes as are being considered right now, but a more concise approach to consider that inequity,” she said.
But in districts where budgets failed, officials say structural changes are still needed. In Barre, where the budget failed, Barre Unified Union School District Board Chair Michael Boutin said the Legislature must, at a minimum, create a new funding formula. “We have to have that in order to avoid the huge increases and decreases — the huge increases that we’ve seen in the last couple years,” Boutin said.
He said the rise in school budgets is separate from why property owners are seeing sharp tax increases. The average state increase in school budgets is 4%, but the average property tax increase is 10%, driven by cost factors including health care. “There’s a complete disconnect, and that’s a product of the terrible system that we have in Vermont with our funding formula,” Boutin said.
Ceglowski says the state should address health care costs before moving forward with rapid education policy changes. “Addressing the rapid rise in the cost of school employees’ health benefits by ensuring a fair and balanced statewide bargaining process for those benefits,” she said.
The 19 districts that did not pass their budgets will need to draft new spending plans to present to voters, which often requires cuts. Twelve school districts are scheduled to vote at a later date.
Copyright 2026 WCAX. All rights reserved.
Vermont is, for many visitors, the postcard-perfect New England state. A part of the United States since 1791, the first to join the Union after the Thirteen Original Colonies, Vermont has many unique, and sometimes quirky, features. The place has attracted artists and other creative geniuses, some of them decidedly eccentric, from its earliest days. The natural parts of Vermont, like the famous Lake Champlain, offer unusual points of interest for visitors and locals alike. With a state as rich in traveling attractions, it should be little wonder that some of them come with a quirk or two.
Montpelier, while being Vermont’s charming capital, is the tiniest among all US state capitals with just around 8,000 residents. For comparison, the second-smallest, Pierre in South Dakota, has a population of about 14,000. Established in 1787, this historic town warmly welcomes visitors with a variety of landmarks, including the Vermont History Museum and the sprawling 200-acre Hubbard Park. The State House is also open to the public for tours. Just a short drive west, less than an hour away, lies Lake Champlain, one of the Northeast’s most beloved watersides.
The town’s name pays homage to Montpellier, a beautiful city in southern France. This naming reflected the high regard for France at the time, especially for their support during the US War of Independence. Interestingly, Montpelier has experienced its share of flooding, with significant damage occurring in the years 1927, 1992, and most recently in 2023.
Elmore, a charming small town in Lamoille County with fewer than 900 residents, is a favorite spot for autumn leaf-peepers. Located north of Montpelier, this peaceful town has its own unique charm, including several local landmarks sharing the name ‘Elmore,’ which adds to its character. It’s important to note that Elmore town is separate from East Elmore. To the west, Elmore Mountain overlooks the area, while Elmore State Park lies just north of the town itself. Enjoying waterside beauty, Elmore Lake is often listed among Vermont’s most picturesque lakes, with its waters flowing into the Lamoille River through Elmore Pond Brook. Like Montpelier, Elmore is situated east of Lake Champlain. For those seeking a more bustling scene or a change of pace, the vibrant city of Burlington, just an hour’s drive west, makes for a perfect day trip or weekend getaway.
Stowe, with a lively population of 5,300, is Vermont’s top spot for adrenaline seekers and the eccentrics among us, earning its reputation as the state’s premier ski and snowboard destination. The Stowe Mountain Resort proudly calls itself the “ski capital of the east”—that’s the eastern United States. Nestled near the breathtaking Mount Mansfield, Stowe offers more than just winter fun; warmer months bring plenty of activities like hiking and mountain biking in the beautiful Cady Hill Forest.
The town also has a rich history, being the home of Jake Burton Carpenter (1954-2019), the visionary behind Burton Snowboards and a trailblazer in making snowboarding an international sport. While some might have called him eccentric when he launched his company in 1977, today he’s celebrated as a true pioneer whose legacy keeps inspiring young snow sports enthusiasts, like those at Mount Mansfield Winter Academy, a special school dedicated to nurturing the next generation of champions.
Manchester, a town with 4,500 residents located in southwest Vermont, is popular among art and architecture enthusiasts. It features Hildene, the estate of Abraham Lincoln’s son Robert, which boasts an impressive Georgian Revival house and grounds. The town’s American Museum of Fly Fishing showcases numerous rods, flies, and related gear, attracting many superstitious anglers. Manchester is also home to Orvis, a renowned fishing and clothing company. The Southern Vermont Arts Center hosts exhibitions, and includes a sculpture garden and performance space. Nature lovers should visit Mount Equinox, west of town, or explore the Green Mountain National Forest to the south.
Eccentric fact: Jonathan Goldsmith, known for portraying “The World’s Most Interesting Man” in Dos Equis commercials, resides in Manchester. Stay quirky, my friends.
Brattleboro, with a population of 12,100, sits along the Connecticut River and features a variety of attractions and oddities. Located just west of New Hampshire—in which the Connecticut River forms the border—and just north of Massachusetts, the town is an ideal midpoint for exploring the wider New England region. Outdoor enthusiasts will appreciate Fort Dummer State Park, welcoming hikers, bikers, and campers alike. Among the more renowned eccentric figures in history, British writer Rudyard Kipling moved to Brattleboro after marrying a Vermont woman in 1892. Their home, Naulakha, references his birth and childhood in India. Kipling believed that Brattleboro’s conservative small-town culture created an
Woodstock, a town with 3,000 residents located in upstate New York, is separate from the famous 1969 cultural event. This southeastern town attracts architecture enthusiasts, particularly for the First Congregational Church, built in 1807 and featuring a bell cast by American revolutionary Paul Revere, and the Norman Williams Public Library, completed in 1884. For outdoor activities, visitors can walk in Woodstock Town Forest, located south of the town, or enjoy panoramic views from the Marsh Billings Rockefeller National Historical Park, the only part of the US National Park system in Vermont besides the Appalachian Trail. Recently, Woodstock has modernized its infrastructure with digital technology, launching the “Wireless Woodstock” initiative in 2011, which provides free Wi-Fi across the entire town. It’s not quirky; it’s just cool.
These small Vermont towns show the state’s sometimes quirky, but never boring character. Architecture fans will find unusual, beautiful examples state-wide. Montpelier is an oddly pint-sized capital with heavyweight history. Brattleboro has long attracted strange, sometimes brilliant types, whether foreign or domestic. Manchester is interesting enough for the World’s Most Interesting Man. And with abundant natural parks, the Green Mountains, and the majesty of Lake Elmore and Lake Champlain, the quirks of Vermont’s best features should attract even the most straight-laced visitors.
Crime
A Vermont postal worker was cited and suspended for allegedly throwing away mail that was supposed to be delivered to other people, according to police.
Natasha Morisseau, 34, of North Troy, was cited on nine counts of petty larceny and five counts of unlawful mischief, Vermont State Police said in a statement. She works as a mail carrier for the town’s United States Postal Service (USPS) office.
Officers were first alerted to the discarded mail on the afternoon of Jan. 23, according to police. Upon finding the mail in a dumpster on Elm Street in North Troy, they determined that none of it was for that address.
Police identified Morisseau as a person of interest and learned that she was a postal employee. They confirmed that she had regularly been throwing away a small amount of mail under her care since at least October 2025, according to the statement.
After searching the dumpster and Morisseau’s mail vehicle, officers found opened and unopened packages, along with several holiday cards, one of which contained money. Morisseau was later cited Feb. 14 and is due to appear March 17 in Vermont Superior Court, police said.
Since Jan. 23, Morisseau has been suspended by USPS, and all recovered mail has been given back to them for delivery, according to the statement. The case has been forwarded to the USPS’ Inspector General for further review.
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