BURLINGTON, Vt. (WCAX) – The town of Essex’s Preliminary Fiscal Year 2026 Town Budget has an increase of 6% compared to their budget last year. For Newport, they’re looking at an 8.9% increase, and in Morristown, 4.4%.
The Lamoille County town’s increase is in part due to a 32% increase in health insurance costs.
“Vermonters are not going to be surprised by the fact that their towns are facing the same budget pressures that they’re facing at their kitchen tables and that businesses are facing in their board rooms. The rising cost of health insurance is really overwhelming,” said Ted Brady of the Vermont League of Cities and Towns.
Regulators known as the Green Mountain Care Board approved double-digit increases for health insurance premiums in 2025, and town budgets and property tax hikes are now reflecting that shift. The chair of the board, Owen Foster, says the alternative to rejecting the increase would be catastrophic.
“Providers in Vermont, far too many, are operating on very, very narrow margins, and low days cash on hand. If they are not paid on their claims, they can’t pay their employees, they can’t pay their rent,” said Foster.
Blue Cross Blue Shield is the largest health insurer in Vermont. As a non-profit, they say for them to be able to pay their debts, they need to keep up with Vermont’s rising care costs, which they say are the main driver in the premium increase.
“The medical and pharmaceutical costs of our members, when those costs go up, which make are the vast majority of the premiums, the premiums have to go up as well,” said Sara Teachout of Blue Cross Blue Sheild Vermont.
Brady says municipal employees used to be in a statewide pool and could negotiate their own insurance, like the teacher’s union. After the Affordable Care Act was implemented, state statutes changed, and municipal employees were required to join the state’s insurance exchange.
So how do we bring health insurance premiums down? Blue Cross Blue Shield and the Green Mountain Care Board agree that the state needs to get its procedural prices under control, and individuals are recommended to stop using the hospital and emergency care for problems that can be resolved cheaper, in primary and appointment care.
Discussions are still underway for some town budgets and the vote to approve or not will take place on Town Meeting Day, March 4th.