Blue Cross Blue Shield of Vermont members should expect an average 4.2% increase in their health insurance premiums in 2021; Vermonters who get insurance from MVP Healthcare will see about a 2.7% increase next year. 

The Green Mountain Care Board approved the rate increases in a decision Friday. 

The companies had asked for higher increases, citing rising pharmaceutical costs, higher rates requested by hospitals, and ongoing uncertainties due to Covid; Blue Cross requested 6.7%; MVP asked for 6.4%. 

Others argued that during a period of economic hardship, Vermonters couldn’t afford to pay higher prices. Health Care Advocate Mike Fisher and Agency of Human Services Secretary MIke Smith both asked the board to deny any increase and keep prices flat. Nearly a thousand Vermonters submitted comments asking the board to consider their need for financial relief. 

Any increase, even a reduced one, “means that more people will be priced out of the care they need,” Fisher said Monday. “It’s troubling to me to see this pattern continue. At this moment, with the price of essentials like food increasing, and the tremendous loss of income, it’s very concerning.”

These rate increases represent averages across different plans. Vermonters will pay varying amounts next year, ranging from a reduction of 2.6% to an increase of 11.0% for Blue Cross members, according to the board. MVP members could see rates decrease as much as 3.9% or increase as much as 4.7% increase, depending on the plan.

Overall, the 2021 rate hikes are the lowest in five years, when MVP was approved for a 2.4% increase, over a period when costs continue to soar. Vermont ranks fourth in the U.S. in health care spending per capita, according to 2018 data from the Department of Economic Analysis. Last year, both insurers received rate hikes of more than 10%. 

Kevin Mullin, chair of the Green Mountain Care Board, said the 2021 rates struck the right balance between keeping insurance companies on stable financial footing and providing relief to struggling Vermonters. 

In the midst of a pandemic, “You have to err on the side of affordability,” he said. At the same time, drawing the line at a zero percent increase would cut into insurance companies’ reserves — which may prove vital in a second wave, Mullin said.

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“The last thing we’d want to do is to not have a product offered on the exchange,” he said, of the insurance options sold on Vermont Health Connect for Vermonters who don’t get insurance from their employers. 

Mullin noted that the board had denied the companies’ requests to increase their administrative costs. 

A lower rate increase doesn’t actually save money, argued Blue Cross spokesperson Sara Teachout; it just defers the costs until next year.

“Until we can get a handle on medical costs that rise year over year, and until Congress controls the staggering costs of pharmaceuticals, insurance rates are going to follow costs,” she said. 

“We are aware that health care affordability is a serious concern,” she added.

MVP spokesperson Michelle Golden called the approved rate hike is a “necessary premium cost increase [that] reflects our efforts to provide the best care possible,” said. She attributed the increases to national trends, and highlighted the company’s efforts to cover Covid-related costs. 

Both companies have the option to appeal the decisions to the Green Mountain Care Board or to the Vermont Supreme Court. MVP will not appeal, Golden said. Blue Cross is still deciding, according to Teachout.  

Any increase is pricing Vermonters out of the health insurance market, Fisher said. Some will have to buy plans with higher premiums; some will avoid care or not buy health insurance at all. 

Many Vermonters are “afraid of getting sick because of what it would mean for their ability to pay,” he said. 

Mullin said he needed to weigh all the risks, including those faced by insurers and hospitals. “We don’t have a crystal ball,” he said. “We don’t know when a vaccine will be available, we don’t know when it’ll be distributed. There are all these different variables.”