1920'sThe Blue Shield concept grew out of the lumber and mining camps of the Pacific Northwest. Serious injuries and chronic illnesses were common among workers in these hazardous jobs. Employers wanted to provide medical care for their workers and made arrangements with physicians who were paid a monthly fee for their services.
These contracts led to the creation of "medical service bureaus" composed of groups of physicians. The first was organized in Tacoma, Washington, by Pierce County physicians in 1917. (The Pierce County Medical Bureau is now known as Regence BlueShield.) Pioneer programs such as this one provided the basis for future Blue Shield Plans.
"Medical service bureaus" composed of groups of physicians. The first was organized in Tacoma, Washington, by Pierce County physicians in 1917
- America's first "Blue Cross Baby" Ann Reid, is born in Durham, NC. This was the first birth in America to be covered by a health insurance family certificate that included maternity benefits. The entire cost of her delivery and her mother's 10-day hospital stay totaled $60.
Justin Ford Kimball, a vice president at Baylor U School of Medicine, develops the world's first hospital care prepayment plan.
19301930's:the rising price of medical care
Pre-paid hospital service plans continue to grow over the course of the Great Depression. The first discounts are negotiated between Blue Plans and hospitals.
The National Labor Relations Act, requiring management to bargain with labor over "wages and conditions" is enacted and becomes a catalyst for employer-based health benefits.
There are 16 Blue Cross Plans with 35,000 members in the United States.
E. A. van Steenwyk, an executive secretary with Hospital Service Association (the forerunner of the Blue Cross and Blue Shield of Minnesota), commissions Viennese artist Joseph Binder to paint a poster with a blue Greek cross. It is the first time the Blue Cross symbol is used. Steenwyk continues to use the symbol to identify his company's health plans. Soon, the Blue Cross begins to show up in other parts of the country and becomes the unifying symbol among the newly emerging plans.
The Social Security Act is passed, omitting health insurance.
A group of Chicago civic leaders, hospital officials, and physicians use Kimball's plan as a model for the city's first pre-paid hospital care plan. Thirty-three individuals, including Arthur Anderson, Milton Florshiem, and T.E. Donnelly, loaned $30,050 in working capital to launch the Chicago Plan for Hospital Care.
October 1, 1936 Hospital Service Corporation is formed to operate the new Plan.
Continuing On The concept of prepayment for hospital care catches on quickly in Chicago and the company grows rapidly. 36,000 people enroll in the first 6 months of operations.
Also in 1937 The first meeting of Blue Plan executives is held in Chicago.
1939 The Chicago-based American Hospital Association (AHA) begins using the Blue Cross symbol to signify that health plans across the country meet certain standards.
Carl Metzger, head of the Buffalo Blue Shield Plan, commissions the creation of the Blue Shield symbol, which combines a serpent with the U.S. Army Medical Corps Insignia.
Also in 1939 Enrollment in Blue Plans is at 3 million nationally.
Group Hospital Services, Inc. (Texas Blue Cross Plan) incorporates. The first official "modern" Blue Shield Plan is founded in California.
19401940's:Growth in the Health Insurance Market
Incorporation of Hospital Services, Inc. (New Mexico Blue Cross Plan).
Group Hospital Services of Oklahoma (Oklahoma Blue Cross) begins operations.
Unemployment drops to 1.2%. Under normal conditions, employers would have lured workers from competitors with higher wages. However, during WWII years, price and wage controls were strictly enforced. To compete for workers, employers began to offer health insurance benefits, giving rise to the employer-based system (still largely in place today).
The Baylor Plan (see 1929) merges into the Texas Institution we know today as the Texas Blue Cross Plan.
Group Medical and Surgical Service (Texas Blue Shield Plan) incorporates.
Sales representatives meeting in 1945
Also in 1945 A group of women devised a way to begin offering hospital care coverage to their underserved rural community. With a $5,000 non-interest bearing loan from the Wyoming Farm Bureau, (the smallest amount ever used to fund a Blue Plan), they organized the Wyoming Hospital Service, which later becomes Blue Cross and Blue Shield of Wyoming.
The Blue Cross Commission, the early national organization of Blue Cross Plans, is created.
4.4. million members are enrolled.
Also in 1947 Peoria Blue Cross Plan and Danville Blue Cross Plan merges with Hospital Service Corporation.
Chicago Medical Service, established as a prepaid plan for physician services, adopts the Blue Shield program.
1948 A group of nine Plans known as the Associated Medical Care Plans informally adopts the Blue Shield symbol. This group eventually becomes the National Association of Blue Shield Plans.
The Inter-Plan Service Benefit Bank is created as a coordinating mechanism to provide coverage for subscribers who were hospitalized away from home, a forerunner of BlueCard.
1950The groundbreaking "U.S. Steel Agreement" goes into effect between United States Steel Corporation, the Carnegie Pension Fund and Blue Cross of Western Pennsylvania. The role played by the Pittsburgh-based Plan – the "control Plan" that coordinated administration of benefits by local "participating Plans" – becomes the linchpin of the Blue System's ability to serve large national accounts.
Also in 1950 The Chicago Medical Service changes its corporate name to Illinois Medical Service and begins to expand its operations statewide.
1960The Blue Cross Association replaces the commission of the Chicago-based AHA. The Blue Cross Association now operates independently of the AHA.
Also in 1960 the first FEP open enrollment period takes place.
The Medicare and Medicaid programs are created. Launching a massive program like Medicare would have been prohibitive without the established Blue Cross and Blue Shield infrastructure.
President Lyndon B. Johnson signs the Medicare bill into law in 1965.
Fort Dearborn Life Insurance is established.
1970Since Medicare's inception in 1965, Blue Cross processes 63.4 million claims totaling approximately $19.2 billion.
Pre-paid health care plan begins in Carbondale, Illinois (early HMO).
Hospital Services, Inc. and Surgical Services, Inc. merge to form Blue Cross and Blue Shield of New Mexico, Inc.
Also in 1972 All formal ties with AHA are severed.
The seal of the American Hospital Association is removed from the Blue Cross symbol and replaced by the silhouette of a stylized human figure in a circle, symbolizing humanity. The Blue Cross and Blue Shield symbols have gone through subtle changes over the years, but the strength of the Brands has remained constant.
Also in 1973 The Health Maintenance Organization Act provided federal grant and loan money to help HMOs get off the ground and contained broad language about benefits that had to be provided. Co-Care, the predecessor of HMO Illinois, starts in Chicago.
While the Blue Cross and Blue Shield Plans were separate corporations (Hospital Service Corporation and Illinois Medical Service) with separate boards, the two operated as a single entity under one management.
In 1975, state law was revised to allow the two organizations to merge. The result was the creation of the Chicago based Blue Cross and Blue Shield Plan – Health Care Service Corporation.
Gov. Dan Walker signs into law legislation that allows the Blue Cross Plan and Blue Shield Plan to merge into a single corporation. (Click on clipping to view full version.)
1976 The Association of Blue Shield Plans changes its name to Blue Shield Association.
1976 - The origins of BlueCross BlueShield Association.
Rockford Blue Cross Plan - the last stand-alone Plan in Illinois – merges with Health Care Service Corporation (HCSC).
Also in 1982
Health Care Service Corporation's Board of Directors approves the change to become a mutual legal reserve company.
Group Hospital Service, Inc. is renamed Blue Cross and Blue Shield of Texas, Inc.
Blue Cross and Blue Shield Association establishes the Technology Evaluation Center (TEC) and pioneers the development of scientific criteria for assessing medical technologies
1990'sHCSC acquires Preferred Financial Corporation and its subsidiary, Colorado Bankers Life Insurance Company.
Blue Cross and Blue Shield of Illinois launches first CareVan mobile immunization unit, which later serves as a model for similar projects at other Blue Plans.
BlueCard® is launched. This program enables member who are traveling or living in another Plan's service area to receive the same health care service benefits of their home Plan.
HCSC Data Center opens.
Also in 1996
Nationally, Blue Cross and Blue Shield Plans; PPO, POS and HMO enrollment reaches 34.6 million, surpassing the 31.7 million members in traditional coverage.
October 17, 1997
New HCSC corporate headquarters is dedicated.
December 31, 1998
Blue Cross Blue Shield of Texas merges with Health Care Service Corporation.
2000July 1, 2001
HCSC acquires Blue Cross and Blue Shield of New Mexico.
HCSC enrolls its eight millionth member.
Blue Cross and Blue Shield system-wide enrollment reaches all-time high. More than 88 million Americans – nearly one in three – have Blue Cross and Blue Shield coverage.
The Blue Cross and Blue Shield Association launches BlueWorldwide ExpatSM, a new worldwide medical coverage program for expatriate workers in U.S.-based companies doing business abroad. HCSC enrolls its nine millionth member.
November 1, 2005
HCSC merges with Blue Cross and Blue Shield of Oklahoma.
HCSC is now the nation's fourth largest health insurance company and the largest non-investor owned health insurer. Nationally, Blue Plans enrollment tops 94 million. Milestones in Covering America:
• Labor: Blue Cross and Blue Shield Plans worked closely with Labor from its beginnings in the 1930s and 1940s. They now provide health benefits to more union workers, retirees, and their families than any other national carrier.
• FEP: Since the enactment of the Federal Employees Health benefits Act in 1959, Blue Cross and Blue Shield Plans across the country have enrolled over 50% of the federal workforce, retirees, and their families. The Federal Employee Program (FEP) is the largest single health plan group in the world.
• Medicare: In 1966, when Medicare, the new federal health insurance program for the nation's elderly and disabled was launched, the Blue Cross and Blue Shield organizations provided an infrastructure that helped move the program forward. The Blue System is the largest single processor of Medicare claims in the country.