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Encyclopedia of Cleveland History

BLUE CROSS OF NORTHEAST OHIO

BLUE CROSS OF NORTHEAST OHIO

BLUE CROSS OF NORTHEAST OHIO united the CLEVELAND HOSPITAL SERVICE ASSN. (CHSA) and the Akron Hospital Service Assn. (est. 1936) medical insurance plans. At the merger in 1957, the Akron group had 225,000 subscribers, while Cleveland had 1.5 million. The Blue Cross name and emblem originated with a St. Paul, MN, hospitalization plan in 1933. After 1939, when the American Hospital Assn. adopted the name and the symbol, only nonprofit hospital plans that met association standards could use the name. Blue Cross, based at 2066 E. 9th St., formerly the CHSA office, inherited the problem of maintaining reasonable rates in the face of spiraling hospital costs, expensive new procedures, demands on the system by an aging population, and a surplus of hospital beds.

In 1969 600 people were on staff at Blue Cross, compared to 5 at the start, and 300 in 1965. The plan paid $1.4 billion in benefits during 35 years, paying $100 million in 1968 alone. With 1.8 million subscribers, the company's income was approx. $106.7 million annually. The Blue Cross policy, which at its inception offered 21 days of prepaid hospitalization for $.60 per month, now covered longer stays, prescription drugs, and out-patient services, tailored to specific groups of subscribers. Blue Cross instituted a cash incentive program to hospitals with above-average records on controlling costs, and required that hospitals submit expansion plans in advance to central agencies, such as the METROPOLITAN HEALTH PLANNING CORP., in order to receive certain benefits. The hiring of a financial expert as the new president of Blue Cross in 1976 further reflected the concern with cost containment. In the 1970s, Blue Cross of Northeast Ohio increased out-patient coverage and extended coverage to single-parent maternity, alcoholism treatment, and mental health care at state institutions. Throughout Blue Cross history, its sister organization, MEDICAL MUTUAL OF CLEVELAND, INC., covered physician care. This company was separately managed, but the coverages were intertwined and the products marketed together. Medical Mutual and Blue Cross of Northeast Ohio merged in September 1984 to become BLUE CROSS & BLUE SHIELD MUTUAL OF NORTHERN OHIO.


Condon, George. Fifty Years of Community Service (1984).

See MEDICINE, HOSPITALS AND HEALTH PLANNING.