As the leaves fall and only bare branches remain, health insurance notices start piling up in mailboxes. This year, I felt a bit heavy-hearted even before opening the envelope. I had been hearing from friends in other states that next year's premiums would rise by double digits.

However, when I checked the numbers for Vermont, the situation looked quite different. The increase rate for individual insurance premiums in Vermont for 2027 is around 3%, which is among the lowest in the country. I've outlined the reasons for this below.

First, let's look at the confirmed numbers. The Green Mountain Care Board, Vermont's insurance rate review agency, finalized the 2027 rates on August 17, 2026.

The BlueCross BlueShield of Vermont individual plan is set to increase by 2.2%, while the small group plan will rise by 1.2%. MVP Health Care's individual plan will increase by 3.9%, and the small group plan by 6.2%.

This means that individuals and small businesses purchasing insurance through Vermont Health Connect will see increases ranging from 1% to 6% next year. Looking only at individual plans, the numbers from the two companies are 2.2% and 3.9%, which is why we say "around 3%".

Importantly, this is not the number that the insurers wanted. According to reports, BlueCross requested a 6.5% increase for individual plans, while MVP sought a 7.8% increase.

The requests for small group plans were even higher. BlueCross requested 4.5%, and MVP asked for 9.1%, but the review board reduced all four rates below what was requested.

According to reports, this decision affects 67,000 ACA plan enrollees. Since these two companies are the only ones in the Vermont ACA market, this decision essentially drives the entire market.

Compared to other states, the difference is significant. An analysis by KFF of 276 insurance company applications across all 50 states and DC found that the median increase rate for 2027 was 15%. This marks two consecutive years of double-digit increases.

By state, Alabama has a confirmed increase of 25%, New Mexico 24.4%, and Arizona insurers requested a 29% increase. Even Connecticut, which is also in New England, was approved for an 11.3% increase.

However, it's cautious to say "the lowest in the nation" definitively. Many states are still in the application phase, so the final rankings are not yet determined, and Vermont's public broadcasting has also referred to it as "among the lowest" based on KFF data.

So why did Vermont see a smaller increase? The biggest reason is that this review board makes binding decisions. In some states, insurers' requests are simply approved, but here, the board actively reduces the numbers each summer and issues orders.

The second reason is the response to drug costs. Both insurers cited rising drug prices, particularly for weight-loss medications, as the main cause of the increases. BlueCross reportedly lowered its rates by switching some brand-name drugs to cheaper alternatives.

This part is important. The medications you are currently taking may be excluded from next year's formulary or may have changed tiers, so when you receive the notice, be sure to check and consult with your doctor or pharmacist if you need to switch to an alternative.

The third reason is administrative costs. The board's actuaries assessed that both companies have lower administrative costs compared to most insurers nationwide.

However, it's premature to feel too relieved. Vermont's insurance premiums are currently among the highest in the nation. The low increase rate is being added on top of an already high starting point.

According to data from the state health insurance advocate's office, since 2021, BlueCross's individual plans have increased cumulatively by 74.6%, and small group plans by 51.5%. Considering this significant rise over five years, it's not surprising that this year's numbers feel low.

BlueCross's situation is also complex. The company was once on the brink of insolvency, and this application includes costs for rebuilding reserves and repaying $30 million borrowed from its Michigan affiliate.

There were differing opinions within the board as well. Commissioner Owen Foster was the sole dissenting voice on the MVP decision, citing concerns that Vermont residents' money was flowing to out-of-state hospitals.

The board instructed insurers to reassess the costs paid to out-of-state hospitals. They also prepared to align hospital rates with Medicare at a certain ratio, as mandated by a law passed in 2025.

Ultimately, the largest portion of insurance premiums is hospital costs. How these costs are managed will likely determine Vermont's insurance premiums for the coming years.

Another point to consider is the federal tax credits. Reports have indicated that as some federal subsidies decrease, even a slight increase in rates could lead to a much larger increase in actual out-of-pocket costs for families.

Therefore, it's important not to feel reassured by the 3% increase figure alone. You should also consider how much subsidy you receive and what your actual monthly payment will be.

The open enrollment for the 2027 plans begins on November 1, 2026. The deadlines may vary each year, so it's safest to check directly on the Vermont Health Connect official website.

If it were me, I wouldn't rely on automatic renewal this time. I plan to compare the monthly premiums, deductibles, and whether my doctors and medications are covered side by side for the BlueCross and MVP plans.

If your income has changed, be sure to update your application information. The amount of your subsidy will depend on that.

As trees shed their leaves before winter, Vermont seems to have shed some excess this time. While it's not perfect, I believe the strength of this small state lies in its thorough review process. However, to deepen its roots, it will need to address the issue of hospital costs as well.