[{"_1":2,"_87":-5,"_88":-5},"loaderData",{"_3":4,"_26":27},"root",{"_5":6,"_17":10,"_18":19,"_20":21,"_22":10,"_23":-5,"_24":-5,"_25":10},"user",{"_7":8,"_9":10,"_11":10,"_12":-5,"_13":-5,"_14":15,"_16":-5},"roles",[],"isAuthenticated",false,"isPremium","planName","subscriptionStatus","featureFlags",{},"insightsBudget","isDevelopmentHost","userPreferences",{},"recaptchaSiteKey","6LcvOJcUAAAAAHsB-gPGfGktcRlKpH7OTIU_dMTD","isImpersonating","impersonation","affiliateStatus","isFreedomPortal","routes/v2/article/layout",{"_28":29,"_30":31},"notFound",true,"relatedArticles",[32,75],{"_33":34,"_35":36,"_37":38,"_39":40,"_41":42,"_43":44,"_45":46,"_47":48,"_49":50,"_51":52,"_53":54,"_55":56,"_57":58,"_59":60,"_61":62,"_63":64,"_65":66,"_67":68,"_69":70,"_71":72,"_73":56,"_74":56},"mediaId",6376470,"mediaKeyId","2140162-377a6533c3b8c0f2aca43dc63a43de62","parentId",2140162,"title","Lawmakers, advocates and insurers debate reference‑based pricing, CON thresholds and drug costs as drivers of Vermont’s expensive health care","audioSeconds",1832,"startMs",1998000,"endMs",3830000,"viewUrl","/Search/View?dp=1&key=2140162-377a6533c3b8c0f2aca43dc63a43de62&start=1998&end=3830","thumbnailUrl","https://assets.pipeline.soar.com/2140162-377a6533c3b8c0f2aca43dc63a43de62/thumbnail_1998000.jpg","articleUrl","/articles/6376470/Vermont/Lawmakers-advocates-and-insurers-debate-referencebased-pricing-CON-thresholds-and-drug-costs-as-drivers-of-Vermonts-expensive-health-care","mediaUrl","https://secure.pipeline.soar.com/6376470-3b0fd4a5babd4f217e5e27200de788e0/orig.mp4?Expires=1775404781&Signature=IKXFSbXS5GTP-Y8t0plsubXQmTDxExkW4losK26hn05FbH8UdnJ0O~JpiVqPrx22-CN4D2yJPlfGZhPDTgUUH5~VZLmHEmYRLvdnEF3mDs9ml51XQ9abRvWis-dZjtn5p1nDXED9AVoNRwFIyFygfctjZbkbf1HcaMHDNd37q12WDVxdgY~fXKJKB27BiXj5aV87WcTp1A1~erejtmcurzBVCj-mN4Zr6e7Vk27QpbQJs-CP63a04jvrXtIwhScovRQun3W-9cs5iy70K8cPsfn0SiHw2fcSiSrlDhAA30nFg9IlDtWtCvkoecSLVDQbzhrbdbhHP4EDXwKXS7IQLA__&Key-Pair-Id=KUT5TJCACFTXG","author","","date","2025-01-22T09:30:15Z","article","Stakeholders testifying to the Vermont House Committee on Health Care aired competing policy ideas to address why Vermont has among the highest health care costs in the country: reference‑based pricing, changes to certificate‑of‑need rules, stronger transparency on outpatient drug pricing and attention to market structure that is shifting risk out of state‑regulated markets.

\"Reference‑based pricing could help rationalize prices across providers, but you wouldn't want to do it just for one payer or overnight,\" said Sarah Teachout, director of government and media relations for Blue Cross and Blue Shield of Vermont. Teachout told the committee Blue Cross supports the concept in principle but urged phased implementation and broad application across payers to avoid unintended cost shifting that could jeopardize hospital budgets.

Mike Fisher, the state's Health Care Advocate, urged legislative action to develop a theory for how Vermont will pay for the health care system it wants. Fisher suggested raising the threshold for certificate‑of‑need (CON) review to encourage more competition in some areas, while warning that CON reform requires nuance to avoid enabling bad actors or destabilizing necessary local services.

\"If we keep doing the same thing without intervention, we're going to see hospitals close,\" Fisher said, referencing the 2024 Act 167 report and the committee discussion that followed. He urged a planful approach to avoid market‑driven closures and to protect rural access.

MVP Health Care representative Jordan Estes described market dynamics that complicate policy design: a steady shift of covered lives out of fully insured state markets into self‑funded and multi‑state arrangements has reduced enrollment in Vermont’s state‑regulated pools and increased volatility and cost pressure in the remaining markets. Estes said about 72,000 Vermonters are in state‑regulated individual and small‑group markets and MVP holds roughly 38–40% of that market slice.

Estes and other witnesses also flagged drug pricing and the interaction of federal programs with commercial markets. Estes noted a provision in Vermont’s PBM (pharmacy benefit manager) law that, in his view, prevents carriers from tracking on claims when a 340B‑covered drug is used, limiting insurers' visibility into outpatient drug acquisition costs and complicating pricing analysis.

Lawmakers and witnesses also discussed the recent strategy known as \"silver loading,\" which some presenters said increased federal subsidy purchasing power for lower‑income Vermonters. One presenter cited an estimate that silver loading delivered roughly $40 million in additional buying power for individual market consumers in the prior year.

Positions and cautions offered during the hearing:

- Reference‑based pricing: advocated as a tool to reduce price variation, with carriers and advocates recommending phased, system‑wide adoption rather than narrow application to a single payer. Carriers warned of hospital budget pressure and possible cost shifting if a lower reference price is used only for a subset of payers.

- Certificate of Need (CON): some witnesses urged raising the dollar threshold for CON review to spur lower‑cost providers and freestanding centers; others warned to preserve review for high‑cost capital projects and to protect service quality and placement in rural areas.

- Pharmaceuticals and 340B: speakers urged better tracking and transparency for outpatient drug spending, noting federal influence on prices and limits to state authority over manufacturer prices.

- Market structure: MVP and others warned that as employers move to self‑funded or multi‑state arrangements, the state‑regulated market pool shrinks and concentrates higher‑cost lives, increasing volatility and upward pressure on premiums for the remaining enrollees.

No formal votes were taken. Several bills were referenced as pending or expected this session: legislation to keep the individual and small‑group markets unmerged (support cited by Blue Cross and MVP), and an Act 111 cleanup bill (H.31) to adjust implementation details. Committee members asked for further briefings, including an education session on pharmacy benefit managers (PBMs) and more data on price variation across facility types.

What’s next: Committee members said they will continue to evaluate proposals as they receive the governor’s budget materials and additional data briefings. Witnesses and lawmakers signaled broad agreement that any major payment or pricing reform will require phased implementation and careful attention to impacts on hospital finances, employer markets and rural access.","mediaType","Video","parentTitle","Senate Finance - 2025-01-21 - 1:00PM","oneSentenceSummary","Stakeholders at the House Health Care Committee session discussed reference‑based pricing, certificate‑of‑need thresholds, prescription drug pricing, 340B tracking and market structure as potential levers to control Vermont’s high health care costs.","taxTitle","Finance, SENATE, Committees, Legislative , Vermont","taxId",38150,"location","Vermont","headline","shortSummary",{"_33":76,"_35":36,"_37":38,"_39":77,"_41":78,"_43":79,"_45":80,"_47":81,"_49":82,"_51":83,"_53":84,"_55":56,"_57":58,"_59":85,"_61":62,"_63":64,"_65":86,"_67":68,"_69":70,"_71":72,"_73":56,"_74":56},6376474,"Blue Cross Blue Shield of Vermont asks to raise reserve contribution after multi‑year losses",1967,19000,1986000,"/Search/View?dp=1&key=2140162-377a6533c3b8c0f2aca43dc63a43de62&start=19&end=1986","https://assets.pipeline.soar.com/2140162-377a6533c3b8c0f2aca43dc63a43de62/thumbnail_19000.jpg","/articles/6376474/Vermont/Blue-Cross-Blue-Shield-of-Vermont-asks-to-raise-reserve-contribution-after-multiyear-losses","https://secure.pipeline.soar.com/6376474-8e8040f6efeaa7e9fc31058ec30dbc31/orig.mp4?Expires=1775404781&Signature=mh5BL-rwBAtkNL7f0waS1dEifzc0Hoe2~4hDaJ~fNJ5xQi1g0Y2Wq~aoTemtRqiHTOy487NAU8J2BvXrhR-dnYNaFOvbIhtasESYVfVBQOl1iM0La~HUap8ysC2cx~~VXrDP5CNFDzTddz1HwTkKbUjTi6XpgNKd8qoBiTwjRXiFfnNf~VaxQgX0RV~RgPR6Y-p1U0aLEWVjf5LG-Yj9thXK1FJ67FX97enp~DmTBE7Y2zrYSyo2j8hqsdz7vLzeXzifAfyRrAnmn8ooQfqWVTIjmII3ExSYoEd5NmHwJcSxrpP1MMlfDcC0uBSi8XZ3x1nUOpT2vI6lmtsEF8bxeA__&Key-Pair-Id=KUT5TJCACFTXG","Blue Cross and Blue Shield of Vermont told the Vermont House Committee on Health Care that its health plans have lost money in five of the last six years and that it has asked regulators to allow a larger contribution to reserves to rebuild financial cushions.

\"We have asked for a 7% contribution to reserves,\" said Sarah Teachout, director of government and media relations for Blue Cross and Blue Shield of Vermont. She told lawmakers the request is part of the health plan's 2026 rate filing strategy to restore reserves after a string of losses.

The request follows what Teachout described as a weak reserve position: she said the plan’s reserves are now below the level regulators would expect, amounting to “less than a month” of claims on hand. Teachout also highlighted 2023 financials, saying Blue Cross Vermont paid roughly $1.5 billion in member care that year and that, on average in 2023, the plan paid out $1.11 in costs for every dollar it collected in premium. She said administrative costs for the plan were about 6.2% of premium, which she described as low by national comparison.

Why it matters: Insurers’ reserve levels and the contribution assumptions used in rate filings affect premium requests reviewed by the Green Mountain Care Board and, therefore, potential premiums for Vermont businesses and individuals.

Teachout told the committee that the carrier is required by the Department of Financial Regulation to hold reserves to ensure it can pay claims in adverse years and for unusual events. She also noted one historical shock: after the federal government stopped cost‑sharing reduction payments, Blue Cross Vermont lost an estimated $12 million in a single year from that policy change.

Health Care Advocate Mike Fisher, representing the Healthcare Advocate office at Vermont Legal Aid, said he had received recent communications quantifying losses and pointed to one month in which an official email reported claims exceeded premiums by about $13 million. He told the committee that the pattern of losses increases risk to market stability and affordability for Vermonters.

Blue Cross of Vermont also described corporate changes intended to reduce back‑office costs: Teachout said the plan became a subsidiary of Blue Cross and Blue Shield of Michigan to gain access to larger IT and vendor platforms while maintaining local operations and provider relationships.

Teachout said final year‑end figures for 2024 must await claims runout data, which is typically settled in March after the year’s claims are processed; rate filings under review by the Green Mountain Care Board reflect those actuarial inputs.

Committee context: Committee members pressed for more detail about causes of higher costs and asked about the interplay of hospital budgets, pharmacy spending and the effect of federal premium tax credits. Teachout told legislators that uncertainty about the continuation of advanced premium tax credits at the federal level is a material variable for the individual market.

Next steps: Blue Cross said it has filed or will file rate requests with the Green Mountain Care Board; the board’s review will determine whether the requested change to the contribution to reserves is allowed as part of any approved premium schedule. No formal committee vote or regulatory decision occurred during the hearing.","At a House Health Care Committee hearing, Blue Cross and Blue Shield of Vermont described multi‑year financial losses, warned of depleted reserves and said it has asked the Green Mountain Care Board to increase its contribution-to-reserves assumption from 3% to 7% for upcoming rate filings.","actionData","errors"]

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Lawmakers, advocates and insurers debate reference‑based pricing, CON thresholds and drug costs as drivers of Vermont’s expensive health care

Blue Cross Blue Shield of Vermont asks to raise reserve contribution after multi‑year losses