by Mike Del Trecco, President and CEO, VAHHS
You've likely read about the federal budget bill, HR.1, and the range of changes it's setting in motion for Vermont's health care system. Some of those changes are still on the horizon or still in question, but one of the most immediate, carrying with it impacts we know are wide-ranging, is already here, and the numbers tell a very hard story. It is the illimination of federal subsidies, or support for lower- and middle-income Vermonters who purchase their health insurance on the health care exchange.
Let me start with a level-set of the numbers. The enhanced ACA subsidies that helped Vermonters afford insurance on the care exchange, expired at the end of 2025. And four months into 2026, we are feeling the impacts. According to testimony this week from state officials, Vermont Health Connect enrollment has dropped by more than 2,300 people. Compared to last September, nearly 9,300 fewer Vermonters are receiving federal subsidies to help them afford their coverage.
Among the most striking figures shared is that more than 6,200 people buying plans through Vermont Health Connect now receive no subsidy at all at either the state or federal level. Last year, that number was only around 1,600.
This is a massive shift in who can afford to be insured in Vermont. And we know that insurance premiums are already very high compared to other states.
We’ve been saying for a while now that health care affordability has to be addressed, because we know it determines whether people can access insurance. When people lose their subsidies, they face painful decisions about whether to pay premiums that may no longer be manageable or go without coverage and hope nothing goes wrong. A lot more Vermonters are now in that position.
Hospitals know the consequence of this reality. It means fewer preventative screenings, more delayed care and increased use of our emergency departments as the point of entry for folks who are sick or injured. This result moves us backwards; it slows the progress we are making to bring down the cost of care; and it puts progress on health care reform at risk entirely. It’s demoralizing and scary for the people faced with these decisions—our hardworking neighbors and friends, as well as the providers and caregivers who pledge their professional lives to keeping people well.
What makes this harder to accept is that the subsidies further pressure our own state budget. Because of federal support from 2021 through 2025, Vermont didn’t have to spend state dollars to support some individuals. Those dollars are now gone, and the Legislature’s Joint Fiscal Office estimates a loss of roughly $72 million in collective federal support for Vermonters as a result. This loss of funds is something budget writers will have to reckon with, but it comes at a time of immense fiscal pressures in all areas of government—from education to transportation to human service programs. The fact is, there’s no pot of gold to draw from, and no easy budget fix.
The uncertainty, the feeling of going backwards when we really need to charge forward, are real, but here’s something that I hope reassures us in the near-term. Vermont’s hospitals will continue to serve everyone who comes through the door, regardless of insurance status or circumstance. We always have. But care that is not paid for does have an impact because those costs fall somewhere. They fall on hospitals already operating under intense financial pressure, on the state budget, which is equally constrained, and ultimately on all of us. So, we have to work together to get through this really challenging period protecting our patients first, and also our health care system as whole.
Lawmakers are navigating this session as best they can. The stakes are high, and the decisions made in the next several months will matter for years. VAHHS will be at the table, as we always are, making the case for policies that protect access, stabilize the system and keep care local and affordable for all Vermonters.
Thanks for reading, and have a good week.
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