We should start by acknowledging something fundamental: government-paid health care is not recognized by either the Vermont state constitution or the U.S. Constitution. Health care is not a “right” as laid out in these documents. Yet, many of our neighbors in Vermont want such a system anyway. With that clear, we can move forward with an honest conversation about how our health care system is failing us, and what we can do about it.
Additionally, it’s important to recognize how the very nature of health insurance has changed over time. When health insurance was first conceived, it was meant as a safety net for emergencies—unexpected injuries, sudden illnesses, and catastrophic medical costs. It was never intended to be the primary payment method for every routine doctor’s visit or prescription refill. Over the years, health insurance has morphed into a bloated, inefficient system that covers virtually all aspects of health care, making it an expensive intermediary for even the simplest of services. This fundamental shift has driven up costs, overburdened the system, and sparked the need for an overhaul.
The Current State of Health Care Costs
Let’s start with the numbers. In 2023, the total health care spending in Vermont is estimated to be $6.65 billion. That’s an astronomical figure for a state with a population of just over 645,000. When broken down, this works out to about $10,310 per resident annually, or roughly $859 per month. Now, consider the fact that Vermont’s small businesses and households are already struggling to cover basic living expenses in a state with some of the highest costs of living in the country.
Employers, particularly small businesses, face a daunting task in providing health insurance for their employees. On average, employers are paying between $1,200 to $1,500 per month per employee for family health insurance plans. That’s a significant portion of any small business’s payroll. And these costs are only rising—Blue Cross Blue Shield of Vermont (BCBS) and MVP Health Care, the two remaining insurers in the state, are increasing premiums by double digits each year, with 2025 projected to be no different. BCBS premiums for small group plans are set to rise by 22.8%, while MVP will raise them by 11.1% (healthinsurance.org) (Green Mountain Care) ().
Meanwhile, households that don’t receive employer-sponsored health insurance face equally high costs. They are left to deal with Vermont Health Connect, the state’s Affordable Care Act exchange, where individual plans can cost $600 to $800 per month just for basic coverage. Add deductibles and co-pays, and many Vermonters are priced out of adequate health care entirely. In the wealthiest nation on Earth, how did we end up with a system so broken?
Trump’s Plan to Help—and Why It Didn’t Work
Back in 2017, President Donald Trump introduced a bold initiative aimed at addressing the very issue Vermonters are grappling with—out-of-control health care costs. Trump’s plan to allow the sale of insurance across state lines was designed to increase competition among insurers, lower premiums, and provide more options for consumers. In theory, Vermonters could have benefited from access to lower-cost insurance plans from less-regulated states, breaking free from the stranglehold of BCBS and MVP.
But it didn’t work out that way. While Trump’s plan was a solid step toward market-based reform, Vermont’s strict state regulations prevented any meaningful change from taking place. The state’s health care market remains one of the most heavily regulated in the nation. Vermont law requires insurance companies to meet extensive consumer protection standards, offer comprehensive coverage, and maintain strict price regulations—meaning out-of-state insurers had no real incentive to enter the Vermont market.
The result? Trump’s effort to open up the insurance marketplace fell flat in Vermont, and residents continued to face ever-rising costs under the heavy thumb of the Green Mountain Care Board, which oversees health care regulation. Instead of fostering competition and lowering costs, Vermont’s regulatory environment has kept the market small, expensive, and restrictive.
Is There a Better Way?
The numbers tell us that the current system isn’t working. Health care costs are unmanageable, insurance premiums keep rising, and both businesses and individuals are being squeezed. The solution isn’t more regulation, but less. We need to think about how to make health care simpler, more efficient, and less burdensome—not just for patients, but for everyone involved in the system.
What if Vermont took a radically different approach? Instead of relying on a complicated web of insurance companies, billing departments, regulations, and price negotiations, we could shift to a model where the state pays hospitals directly for the care they provide. No middlemen. No insurance companies. No bureaucratic red tape. Just simple, straightforward transactions. Here’s how it could work:
Imagine a system where, if you break your leg, you go to the hospital, they fix it, and the hospital sends a bill directly to the state. The state pays the bill using a streamlined payment system—let’s say a simple WooCommerce-style portal, which would cost around $500 to create and about $2,000 a year to operate. Every patient would have an anonymous tracking number, ensuring privacy. The state never knows your personal details; it only receives the bill tied to a number. The hospital gets paid, the patient gets treated, and everyone moves on.
Handling Non-Residents and Visitors
Of course, Vermont isn’t an island, and there will always be non-residents and visitors who require health care while in the state. Under this system, hospitals would still treat non-residents, but without the burden of managing insurance claims and administrative red tape. Instead, the hospital sends the bill directly to the state, just as they would for a Vermont resident. The state then takes on the responsibility of negotiating and working with out-of-state insurance companies.
Because the state government holds more power and leverage in negotiations than individual hospitals, Vermont would be in a much stronger position to ensure full and timely payment from insurance companies. The state, with its regulatory authority and centralized oversight, could streamline the payment process and ensure that non-resident care is fully covered by the patient’s home insurance provider. This way, hospitals can focus on care, and the state can handle the financial negotiations at a higher level—an efficiency gain for both health care providers and the system as a whole.
For non-insured visitors, the state could develop a straightforward billing mechanism to charge patients directly, ensuring that non-residents still contribute their fair share when they use Vermont’s health care services.
Residency Requirements to Ensure Fairness
To protect Vermont’s health care system from being overwhelmed by out-of-state residents looking for free care, a residency requirement would be put in place. Only residents who have lived in Vermont for at least 12 months and have contributed to the state’s economy through taxes or employment would qualify for the state-run system. This threshold ensures that Vermont’s health care benefits go to those who are truly invested in the state, while also maintaining fairness in access.
Emergency care for visitors and non-residents would still be available, but long-term, non-emergency access to the system would be limited to true residents. This approach prevents the system from being abused while maintaining universal access for those who live and work in Vermont.
The Public-Private Partnership to Make It Affordable
How would this be paid for? It’s easier than you think. Employers already pay around $1,200 to $1,500 per month per employee for health insurance. Under this new model, those contributions would remain, but they would go toward funding the state’s health care system rather than private insurers. Households, on the other hand, could contribute $300 to $500 per month, a far cry from the current cost of private health insurance premiums.
A Free-Market Style Price Control
Here’s where it gets even better: if people use health care more judiciously—focusing on necessary care and preventive measures instead of overusing the system—demand for services will go down. And as demand decreases, so does the cost. This creates a kind of free-market effect, where responsible usage lowers overall expenses, and the reduced costs can then be passed on as lower contributions from both employers and households. In this way, the system becomes not only more affordable but also more sustainable over time. It’s a built-in price control mechanism based on consumer behavior.
Codifying Personal Freedom in Perpetuity
One of the most important aspects of this system would be ensuring that it never becomes a tool for government overreach. We’ve seen how policies like Act 250—originally intended for environmental protection—have expanded far beyond their initial scope, controlling how people use their land and live their lives. To prevent such overreach in a health care system, we must codify in law, possibly through a constitutional amendment, that the state will never be allowed to dictate how Vermonters must live to maintain their health.
The state should not be granted the power to say, “We pay for health care, so now we have a say in how you live your life.” People must be free to make their own lifestyle choices without government interference. This safeguard would ensure that Vermont’s residents can live as they choose without fear of state control creeping into personal decisions under the guise of health care regulation.
The Alternative Reality
Now, I can already hear the critics on all sides losing their minds: “It’s socialism!”, “There’s no price control!”, “It’s unconstitutional!” But here’s the reality: the current system isn’t working for anyone. Vermonters are drowning in health care costs, businesses are being strangled by insurance premiums, and the state is stuck trying to regulate its way out of a mess that only continues to get worse.
This alternative model isn’t about expanding government control—it’s about making the system more efficient and cost-effective. It’s about removing the layers of waste, cutting out the middlemen, and ensuring that health care works for the people who need it most. And, most importantly, it’s about ensuring that Vermonters can access affordable, high-quality care without bankrupting businesses or households, while safeguarding personal freedom.
By codifying in law or even amending the constitution to ensure that the state can never dictate how Vermonters must live, this system would protect the people’s right to live as they choose, free from government overreach. It’s time to stop clinging to a broken system. Vermont has a unique opportunity to do something truly different—and if we get it right, we could create a model that the rest of the nation looks to as a solution for America’s health care crisis.
Dave Soulia | FYIVT
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