Financial Recovery Expected to Be a Multi-Year Process as Organization Continues Focus on Sustainable Solutions to Address Rising Health Care Costs
by Timothy McQuiston, Vermont Business Magazine Blue Cross and Blue Shield of Vermont (Blue Cross VT) today announced an operating gain of $53 million and an operating margin of 2.7% for the year ending December 31, 2025. Blue Cross VT also decided in 2025 to pull out of the Medicare Advantage market for 2026.
“We are pleased with the hard work and collaboration that helped us deliver a positive financial performance in 2025,” said Beth Roberts, President and CEO of Blue Cross VT. “This a meaningful achievement however it does not eliminate the need for continued adequate premiums and an ongoing focus on lowering the cost of care,” she cautioned.
Roberts joined Blue Cross Vermont last November from Don George and became CEO in January 2026.
In 2025, Blue Cross VT total revenue was $2.0 billion, and the company paid out $1.8 billion in member healthcare expenses. The 2025 financial performance was largely driven by:
- Improved alignment between premiums and medical expenses: while medical and drug expenses continue to rise higher than national trends for 2025, the organization anticipated this and therefore premiums better aligned with actual medical costs, a critical factor for financial sustainability.
- Reduced operating expenses: the Blue Cross VT team reduced its operating budget by approximately $7 million in 2025 compared to 2024, reflecting internal cost discipline, staffing controls, and administrative efficiencies, while maintaining the high-quality service its members know and expect.
- Negotiated resolutions: settlements with UVMMC and our Pharmacy Benefit Manager were positive one-time additions to the bottom line.
In addition, Blue Cross VT repaid the $30 million surplus note it borrowed from Blue Cross and Blue Shield of Michigan in late 2024 to boost reserves during the ongoing claims surge. Paying off the surplus note at the end of 2025 avoided $2.4 million in future annual interest payments. Blue Cross VT also increased its member reserves to $105 million, about two-thirds of the minimum reserve level mandated by the Vermont Department of Financial Regulation.
CFO Ruth Greene said Blue Cross VT pulled out of the Medicare Advantage market as three factors "severely impacted" Vermont: Payers leaving the market, reduced funding by CMS (the federal Centers for Medicare & Medicaid Services), and high utilization by Vermont Blue Advantage members.
"The combined forces make it unsustainable for Vermont Blue Advantage to be able to offer reasonably priced and affordable products to serves as an alternative to traditional Medicare coverage," Greene said. "In 2025 Vermont Blue Advantage experienced a net loss of over $50 million on coverage for 35,000 Medicare Advantage members.
"Due to our shared ownership and risk structure with Blue Cross Blue Shield of Michigan for Vermont Blue Advantage, Michigan absorbed more than 90% of that impact, resulting in a $3.6 million loss for Blue Cross Vermont," she said.
With MVP and UnitedHealth also leaving the Vermont market, in 2026 only residents in a few counties in southern and eastern Vermont (Bennington, Windham, Windsor, Orange, Caledonia, Essex) are able to access Medicare Advantage plans through Humana. This leaves the majority of eligible Vermonters (about 50,000) access to only traditional Medicare.
Greene said it is too early to tell what Blue Cross' premium rate request to Green Mountain Care Board (GMCB) regulators will look like later this year, but she is "optimistic" there will be improvement. Among the expense reductions is an agreement with the UVM Health Network that will reduce reimbursement rates by 12.3%. There is also Act 68, enacted last year, that will allow for "reference-based pricing" among regulated providers (this does not include private clinics), which sets a maximum price that a health insurance plan will pay for a medical service.
Blue Cross VT requested an individual market rate request increase for 2026 of 23.5% and received from GMCB a 9.6% increase and requested a 13.5% increase for the small group market and received an increase of 4.4%.
GMCB. August 22, 2025.
“While we continue on our financial recovery, we are not losing sight of the fact that Vermonters are struggling to afford health care,” said Roberts. “We need to continue to address rising medical costs while ensuring premiums are both adequate and affordable, and we will do that working alongside healthcare leaders, regulators and legislators. Beyond our collaboration with stakeholders across the health care system, Blue Cross VT remains laser-focused on operating efficiently and maintaining our position as a health plan that manages and limits administrative costs better than most national plans.”
About Blue Cross and Blue Shield of Vermont
Blue Cross and Blue Shield of Vermont is a local, not-for-profit health plan. For over 40 years, the company has been enhancing the health and well-being of the Vermonters we serve by offering innovative plans to individuals, older Vermonters, and businesses. Our employees are dedicated to developing new ways to support high-quality care, programs and events that promote wellness. Blue Cross and Blue Shield of Vermont is a licensee of the Blue Cross and Blue Shield Association. For more information, visit www.bluecrossvt.org.
Berlin, Vermont, March 2, 2026 — Blue Cross and Blue Shield of Vermont
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