MEDICAL MUTUAL OF CLEVELAND, INC., offered Clevelanders prepaid physician care that complemented the prepaid hospitalization offered by its sister corporation, the CLEVELAND HOSPITAL SERVICE ASSN. (precursor of BLUE CROSS OF NORTHEAST OHIO) from 1945-83. The need for prepayment for doctor care was long recognized by health planners (see HOSPITALS AND HEALTH PLANNING), but health insurance pioneers such as JOHN R. MANNIX realized that the medical profession would sabotage any hospital plan that included professional fees. Physicians maintained that payment of services to a third party interfered in the doctor-patient relationship. Therefore, when the Cleveland Hospital Service Assn. was set up, payment for doctors was not included. Mannix sold the plan to the medical community by emphasizing that patients would pay their doctor bills more quickly if they were relieved of burdensome hospital costs. By 1938 the MEDICINE acceded to the need for a medical service plan and formulated a preliminary proposal. It became the basis of 1941 legislation that established a state-approved plan. The Cleveland Medical Service Assn. was created to provide complete medical care for persons with low incomes, but protests from physicians prevented the new organization from functioning. In 1945 trustees and officers of the Cleveland Hospital Service Assn. and city hospitals borrowed $75,000 from the Welfare Federation to found Medical Mutual of Cleveland, Inc., a separately managed company that would reimburse patients a set amount for surgery and obstetrical care. Though the Academy of Medicine protested, the plan clearly did not force physicians to accept a standard fee, as the contract was with the patient-subscriber, and not the doctor. Within a year, 100,000 people joined the plan.
Only Blue Cross subscribers were eligible to purchase Medical Mutual. Within 2 years of its establishment, Medical Mutual coverage broadened to include in-hospital care; anesthesia coverage was added in 1956, diagnostic services in 1956, and posthospital care in 1959. In 1966 Medical Mutual became a Medicare Part B intermediary and, later, also offered catastrophic coverage and dental and vision care. In 1975 it set up the Medical Life Insurance Co. as a wholly owned subsidiary to generate income and offset Medical Mutual rates. Medical Mutual was affiliated from 1961 with the national Blue Shield system. In 1983 it merged with Blue Cross Of Northeast Ohio to become BLUE CROSS & BLUE SHIELD MUTUAL OF NORTHERN OHIO.
See also MEDICINE.