Vermont
Financial struggles have pushed Vermont’s largest health insurer to the brink – VTDigger
Over the past several months, Vermont lawmakers and state officials have been preoccupied with the fate of the state’s largest health insurance company.
Blue Cross Blue Shield of Vermont, the Vermont-based member of the nationwide health insurance organization, is also the only health insurance company based in Vermont. The nonprofit covers roughly a third of the state’s population across all its plans.
Now, with its reserves drained by a multi-year surge in insurance claims, the nonprofit is facing a financial crisis with little recent precedent. As Blue Cross Blue Shield prepares to ask state regulators to increase premiums in 2026, the financial health of the company has alarmed policymakers and prompted a scramble to shore up the company.
“If Blue Cross cannot pay the claims, the system fails,” Owen Foster, the chair of the Green Mountain Care Board, a key health care regulator, told lawmakers last month.
Federally qualified health centers, independent clinics, mental health agencies, possibly even hospitals — “if they don’t get paid, they close their doors,” Foster said.
The financial headwinds facing Blue Cross Blue Shield are familiar to many in Vermont’s health system. In the wake of the Covid-19 pandemic, hospitals and other providers have seen a surge of patients, many presenting with more complex conditions. What’s more, the price of care — particularly drugs, and more particularly specialty drugs, like popular weight-loss medications known as GLP-1s — has increased precipitously in the past few years.
That’s led to unexpected increases in health care expenditures across the state. In both 2023 and 2024, for example, the University of Vermont Medical Center exceeded its budgets by tens of millions of dollars — overages that, hospital administrators said, were caused by a massive surge in patients needing more care.
That surge has, in turn, drained Blue Cross Blue Shield’s cash reserves. From 2021 through the end of 2024, Blue Cross Blue Shield has lost nearly $152 million, according to data the insurer presented to legislators earlier this month. Last year alone, Blue Cross lost $62.1 million.
In 2019, the insurer had $133.5 million in the bank. At the end of 2024, Blue Cross Blue Shield had just $58 million — and pays out an average of $35 million a week in claims.
Last year, credit rating agency A.M. Best downgraded Blue Cross Blue Shield’s rating twice, bringing its score from B++ to C++. That’s moved the insurer’s rating from “good” to “marginal” in a matter of less than six months.
“I’ve lived and worked in Vermont for 45 years,” Don George, the CEO of Blue Cross Blue Shield, told lawmakers in the Senate Committee on Health and Welfare last month. “And I’ve just never seen anything remotely close to what we’re going through now.”
‘We’re fortunate’
A significant chunk of those losses have come from Blue Cross Blue Shield’s Medicare Advantage plans, Vermont Blue Advantage. From 2019 through 2023, Blue Cross Blue Shield lost $43.4 million on those plans, according to financial records. Roughly 35,000 Vermonters are on Blue Cross Blue Shield Medicare Advantage plans, Sara Teachout, a spokesperson for the insurer, said.
Some of those early losses were startup costs ahead of the plans’ rollout in 2021, Teachout said. Once they hit the market, the plans continued to lose money — $11.5 million in 2022 and $22.5 million in 2023 — along with the rest of the insurer’s portfolio, records show.
Those deficits are due to the same factors affecting the rest of Blue Cross Blue Shield’s generally, Teachout said: a rise in residents needing care and increasing costs for that care.
Those losses “are proportionate to the losses in our other lines of businesses that are due to the cost surge,” she said.
To shield itself from those losses, Blue Cross Blue Shield of Vermont has almost entirely unloaded its Medicare Advantage business onto Blue Cross Blue Shield of Michigan, an affiliate nonprofit insurer. It’s also taken out a $30 million loan from Blue Cross Blue Shield of Michigan.
Because of its shaky financial footing, Blue Cross Blue Shield of Vermont is paying 8% interest on that Michigan loan. George, the CEO, said in an interview that the insurer was lucky to have even gotten a loan in the first place.
“The reality is, we would likely — under those circumstances and that risk — not be able to find anyone that would loan Blue Cross Blue Shield of Vermont (money),” he said. “So we’re fortunate to have Michigan, and that’s how we come up with that interest rate.”
To shore up its finances, the insurer has also held off hiring roughly for 30 positions and has embarked on a “comprehensive capital recovery plan” with the Department of Financial Regulation, according to George.
‘The number one cost driver’
As part of an annual regulatory process, Blue Cross Blue Shield is preparing to request increases to its insurance premiums later this month — increases that are expected to be large. Last year, the insurer raised premiums for individual and small group plans on the state’s health insurance marketplace by roughly 20%.
For 2026, “Given the pace of medical and pharmacy costs and the utilization that we saw right through to the end of 2024, I would expect increases not unlike what we’ve recently seen in the past,” Ruth Greene, the insurer’s chief financial officer, said in March.
Those increases impact not only individual Vermonters’ insurance costs — already some of the highest in the nation — but also their taxes. Most municipalities buy small group insurance plans on the state health insurance market, according to Ted Brady, the executive director of the Vermont League of Cities and Towns.
Prior to last year’s premium increases, roughly 80% of municipal employees were insured with Blue Cross Blue Shield, Brady said, although he now expects that many municipalities have switched to MVP, the other insurer that sells on the marketplace.
“Health insurance is the number one cost driver for municipalities right now,” he said.
School and state employees are also insured on Blue Cross plans, but are on a different type of plan known as self-funded plans. Although those organizations have also seen significant premium increases as health care costs rise, members contribute proportionally less to Blue Cross’ reserves — meaning they are more insulated from the insurer’s financial struggles, administrators at those organizations say.
Still, increasing insurance premiums are “a tremendous economic strain on every part of Vermont,” Vermont’s Chief Health Care Advocate Mike Fisher told lawmakers last month.
‘Acute and immediate threat’
Meanwhile, policymakers and legislators are taking steps on their own. In March, the Green Mountain Care Board, a key health care regulator, announced a deal with the University of Vermont Health Network that will deliver $12 million in hospital funds to Blue Cross Blue Shield of Vermont.
Lawmakers are also hashing out the details of a bill that would allow for emergency action to help health insurers in financial crisis. That bill, H. 482, would allow the Green Mountain Care Board to reduce the reimbursement rates paid to a Vermont hospital if the insurer in question faces “an acute and immediate threat to its solvency.”
Such a rate reduction would only be allowed if the hospital is part of a financially stable network, according to the bill language.
The proposed legislation passed out of the House in March. A key legislative committee, the Senate Health and Welfare Committee, is scheduled to vote on advancing it Friday.
Meanwhile, in the other chamber, the House’s health committee is looking to address the problem of rising costs closer to their source — at hospitals and other providers.
A sprawling bill, S.126, would implement a new payment model known as reference-based pricing, in which hospital charges are pegged to Medicare reimbursement rates, to go into effect no later than 2027. The bill would also direct the Agency of Human Services to work with providers to reduce health care spending by 5% “for hospital fiscal year 2026,” which begins October 1.
That bill passed the Senate in March, and lawmakers in the House Health Care Committee are working on amendments this week.
“There’s a lot of work that has to be done,” Sen. Ginny Lyons, D-Chittenden Southeast, the chair of the Senate Committee on Health and Welfare, said of her committee’s legislation last month. “We can’t let Blue Cross and Blue Shield go under.”
BURLINGTON, Vt. (WCAX) – It’s that time of year again. We go back to standard time 2 AM Sunday, so before bedtime tonight, turn your clocks back 1 hour. After a blustery and chilly Saturday, Sunday will be relatively pleasant with partly sunny skies and highs in the 40s. It won’t be as breezy as the past couple of days.
Monday will start off with some sunshine, then clouds will quickly increase as a cold front approaches the area. Showers are likely around mid-afternoon, first in New York, then spreading eastward. Showers will continue overnight, possibly ending as some mountain snow showers early Tuesday morning. Little to no accumulation is expected. Highs on Monday will be warmer, in the 50s. The remainder of Tuesday will be partly sunny with highs in the upper 40s to low 50s. Lows will be mainly in the 30s.
A clipper will bring light rain on Wednesday, especially south. We’ll be on the backside of that on Thursday, which will feature mostly cloudy skies with showers and mountain snow showers. Highs by Thursday will be in the upper 30s to mid-40s.
Clouds will thicken up on Friday, with another cold front expected to bring showers late in the day, continuing overnight. As with the case Monday night, it may end as some mountain snow showers early Saturday morning. Highs on Friday will be in the 50s. The rest of Saturday will be partly sunny but quite chilly. Most spots may not get out of the 30s for highs.
Copyright 2025 WCAX. All rights reserved.
Vermont
Head Start programs in two Vermont regions may face temporary closure amid federal shutdown – VTDigger
A version of this story by Adora Brown was published on Oct. 29, 2025 by NOTUS. Theo Wells-Spackman is a Report for America corps member who reports for VTDigger.
In Washington, Democrats and national advocates are warning about the growing consequences that the government shutdown will have on Head Start programs across the country.
On Saturday, another wave of funding lapses is set to affect nearly 60,000 more children across 41 states, according to the National Head Start Association.
In Vermont, none of the state’s seven Head Start programs will need to shutter in November, according to Christy Swenson, the Head Start Director at Capstone Community Action and board chair of the Vermont Head Start Association.
However, several will face temporary closure in early December if the shutdown wears on, Swenson said. Leaders of programs serving two Vermont regions — the Champlain Valley and the Northeast Kingdom — anticipate running out of federal funds by then, they said.
The federal Head Start program, which provides child care and nutritious meals to more than 700,000 children across the country, and around 1,250 in Vermont, has already faced funding lapses that forced some locations in other states to close completely and others to look for interim funding elsewhere.
Head Start, together with Early Head Start, aims to serve children from birth to age 5 living in foster care or households with incomes below the federal poverty line, or who are experiencing homelessness. In Vermont, almost one-fifth of children enrolled are unhoused or experiencing housing insecurity, according to an analysis of federal data by a national advocacy group.
“It’s an absolute tragedy,” Sen. Bernie Sanders, I-Vt., who caucuses with Democrats, said about the upcoming lapses. “And it is beyond comprehension that you have a Republican House, which is now in its fifth week of vacation. Maybe they want to come to work and help us resolve this crisis.”
Head Start is funded on annual cycles, which have starting dates that vary from program to program, Swenson said. Once the commitment is renewed, the process of “drawing down” federal funding as it becomes necessary is not affected by the shutdown, she added.
Champlain Valley Head Start in Burlington is only guaranteed funding through Nov. 1, which means their grant ends on Saturday, Sandra Graves, the program’s director, said on Friday. Her program would be able to stay open through November under a continued shutdown, although only by exhausting its financial reserves, she said.
The program, which is operated by the Champlain Valley Office of Economic Opportunity, serves Chittenden, Addison, Franklin, and Grand Isle counties. Graves’ staff of 63 provides care and programs to 233 enrolled children and their families, she said.
On Dec. 5, in the absence of federal funding or other support, all of the program’s offerings will need to pause, and all staff will be furloughed, Graves said. The annual grant from the federal Office of Head Start is roughly $7.2 million, she said, which represents the program’s entire operating budget save two small state-level grants.
The Head Start program run by Northeast Kingdom Community Action, or NEKCA, has a Dec. 1 funding cycle, but does not possess the financial cushion that Champlain Valley has available, said NEKCA Executive Director Jenna O’Farrell. The program may be able to keep running for a short time after Dec. 1 with a fraction of its previous capacity, but O’Farrell said that isn’t guaranteed.
That program operates eight physical locations across the rural Northeast Kingdom. It serves 160 children and their families, and employs 78 staff members.
Champlain Valley Head Start filed its annual federal funding application on time in August, Graves said. Ordinarily, the request should have been approved in September. But the Office of Head Start has seen cuts to staffing under the Trump administration, and every aspect of Graves’ interaction with federal officials has slowed, she said.
Even once the government opens, Graves has been told her organization’s funding approval might take several weeks. It may be hard to avoid the Dec. 5 deadline even if the shutdown ends in mid-November, she said.
Graves has not heard from the federal Office of Head Start since the shutdown began. Even though reimbursement for stopgap measures would be customary, she said recent federal actions toward other service programs have made her nervous.
The program’s closure would be a “huge, huge loss for our children and families,” Graves said. Apart from being a source of food and services for kids, Champlain Valley Head Start provides child care that allows parents to stay in the workforce, Graves added.
Graves has applied for temporary state funding from the Vermont Emergency Board, which on Wednesday approved a state-funded stopgap for lost federal food assistance. Champlain Valley Head Start will need about $1 million to remain stable over the next two months, Graves said.
O’Farrell said she too plans to apply for funding from the state’s Emergency Board. NEKCA’s Head Start program’s monthly expenses total roughly $450,000.
A closure would cause an “immediate, severe impact on low-income families across our service area,” O’Farrell said.
Federal finger pointing
Outside of Congress, pressure from nonprofit groups is starting to pick up as Head Start programs look for solutions elsewhere.
“They are working with their states, working with their counties, working with their school districts, looking within their agencies, talking to philanthropic partners, just really trying to do everything that they can to avoid children and families being the collateral damage of the political fights in Washington,” said Tommy Sheridan, the deputy director of the National Head Start Association, a nonprofit that represents Head Start organizations and programs in Washington, D.C.
“They’re not gonna be able to hold that back forever,” Sheridan added.
Across the country, some Head Start programs already lost funding on Oct. 1 when their fiscal year ended, but the Saturday Nov. 1 deadline will have an even bigger effect because programs in the vast majority of states will lose their federal funding.
More than 100 organizations signed a letter released Tuesday, led by the First Five Years Fund, a nonprofit that supports child care and early education programs. In it, they asked Congress to end the shutdown.
“We cannot allow political gridlock to take away opportunities from our youngest learners and their families,” the letter reads.
But the pressure appears to have little effect on Republicans on Capitol Hill, even though lawmakers are aware that programs in their states could close. The Florida Head Start Association wrote in a press release that seven grantees won’t get a federal check on Saturday, bringing the total number of affected children in the state to almost 9,000.
“Isn’t it awful that the Democrats are doing this?” Sen. Ashley Moody, R-Fla., told NOTUS. Her comment is in line with Republicans’ messaging strategy of placing blame on Democrats for the shutdown as they withhold votes due to expiring health care subsidies.
In a statement to NOTUS, the U.S. Department of Health and Human Services also tried to place the blame on Democrats.
“More than 58,000 children are on course to lose access to Head Start funding and programs on November 1 due solely to the Democrat-led government shutdown,” a spokesperson for the federal department said in a statement to NOTUS.
Despite the fact that many programs for low-income families are barrelling toward losing federal funding, including the Supplemental Nutrition Assistance Program and WIC, senators seem no closer to ending the shutdown stalemate.
The home state of Sen. Rick Scott, R-Fla., would be one of the most affected by Head Start funding lapses.
When asked what people in Florida are saying about losing programs that help low-income families, Scott said, “They’re fed up with the Democrats shutting down the government.”
Human remains were found in northern Vermont in the search for a woman who was reported missing during an attempt to cross the border into Canada in January, police said Thursday.
The remains were found in Jay on Wednesday afternoon by a search-and-rescue team and search dogs and were taken to Burlington for an autopsy on Thursday, Vermont State Police said. The autopsy is meant to determine the cause and manner of the woman’s death; her identity wasn’t available as of Thursday.
Police said the U.S. Border Patrol had reached out for help with the case last week, on Oct. 20. The federal agency was investigating a report of a woman becoming separated from her group while trying to cross the international border, and recently found personal effects belonging to her.
The Royal Canadian Mounted Police have been investigating the case as well, according to police, who didn’t have more details to share about the matter, referring questions about the initial investigation to the Mounties and U.S. Border Patrol.
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