Leading the Way in Health Insurance

Since its beginnings, Blue Cross Blue Shield (BCBS) has shaped the healthcare industry through innovation and leadership. Today, BCBS continues to transform healthcare with the same spirit of innovation that has improved the lives of generations of Americans.

Blue Cross: Origins

Blue Cross began in 1929, as a partnership between a local hospital and its financially struggling patients. Baylor University hospital administrators were seeking a way to make healthcare more affordable for their patients, many of whom were Dallas public school teachers. The hospital administration started off with a plan for them to prepay 50 cents a month for up to 21 days of hospitalization annually. The Baylor Plan was an immediate success, soon enrolling employees in other professions across the city.

Blue Shield: Origins

Like the Baylor Plan, from which Blue Cross would evolve, the early forerunners of Blue Shield originated with America’s workers. Faced with rampant illness and occupational hazards, Pacific Northwest loggers and miners of the early 1900s required substantial medical care to stay healthy and productive. To meet this need, employers organized plans to provide medical services through individual practitioners or groups of physicians for a monthly fee.

Parallel Paths to the Same Goal

Through the 1930s and 1940s, Blue Cross and Blue Shield’s innovative approaches to healthcare options caught on across the country. Offering healthcare plans to more and more Americans, together Blue Cross and Blue Shield grew to encompass 81 hospital plans and 44 medical plans. The two companies began to unify in the 1940s, setting up agreements to ensure that the total 24 million members of both plans would have more comprehensive coverage nationwide.

On December 27, 1933, America’s first "Blue Cross Baby” was born in Durham, North Carolina. The entire cost of her delivery and her mother’s 10-day hospital stay totaled $60. In this 1954 photo, the first Blue Cross baby, Ann Woodward Reid, is shown holding her own Blue Cross baby, Michael.

Healthcare Coverage at the National Level

The 1950s and 1960s saw membership increase: Blue Cross had 52 million members, and Blue Shield had 40 million members. The Federal Employee Health Benefit Program (FEHBP) was created to allow federal employees a choice for their healthcare coverage, and they consistently chose BCBS time and time again. Before the first open enrollment in 1960, the BCBS Federal Employee Program (FEP) already enrolled 33 percent of federal employees. Today, BCBS FEP grows every year, continuing to provide incomparable value, allowing the members to live free of worry, free of fear.

Medicare: Blue Cross Blue Shield Steps up in Historic Moment

Today, it's hard to believe that before the inception of Medicare, half of Americans over 65 were without the protection of any kind of health insurance. The federal health insurance program was created to ensure that our senior citizens could live out their golden years with the healthcare they need and deserve. When Medicare was signed into law in 1966, Blue Cross Blue Shield companies were the only insurers with the claims processing capability and computing power to administer the new program. In its new role, BCBS seamlessly processed the claims of nearly 5 million Medicare patients that first year.

Challenges, Faced and Overcome

In 1978, the Blue Cross and Blue Shield Associations consolidated staff and operations, and the Blue Cross Blue Shield Association was formed in 1982. The next decade brought challenges in the form of economic turbulence and increased competition. However, BCBS persevered, with a focus on expanding member services with innovative programs like BlueCard®, which enables members of one BCBS company to obtain healthcare services while traveling or living in another BCBS company's service area. By the late 1990s and early 2000s, Blue Cross Blue Shield became synonymous with quality healthcare Americans could trust, and enrollment topped 100 million members.

Today, with growth, stability and innovations, Blue Cross Blue Shield continues to be the name generations can count on — as they have for more than 80 years.

We’ll continue to provide stability, in a climate of uncertainty. Clarity, in a sea of confusion. And innovation, in the form of tools, services and programs, to revolutionize healthcare nationwide. Giving Americans everywhere the freedom to look to the future without fear. And the power to Live Fearless.

The Blue Cross Blue Shield Association is an association of 36 independent, locally operated Blue Cross and/or Blue Shield companies.