Blue Cross

When Max Herskovitz got back home to The Bronx from a Jap internment camp in China, he found a check for $67. The money was from New York's Associated Hospital Service to reimburse him for a bill he paid to Shanghai's County Hospital last July. All the time he was interned, Mrs. Herskovitz had faithfully kept up the insurance payments.

His was the first reimbursement the Service has made for hospitalization in the Orient. The Service, now well out of its lean years, almost foundered in the mid-'30s, when it had no safeguards against families which joined just in time for Mamma to have a baby. The New York A.H.S. has since picked up a neat $8,000,000 surplus, gradually adding new benefits (e.g., paying for all drugs) for its 1,450,000 subscribers. The Service now pays a hospital bill every four minutes.

The Associated Hospital Service is an affiliate of the Blue Cross.* The 77 associations cover the U.S. (except in Indiana, which has no law allowing nonprofit group hospitalization), serve some 13,000,000 people. New subscribers are joining at the rate of about 50,000 a week. About 90% of U.S. citizens and many Canadians are eligible.

The hospitalization plans vary. Costs are around $8 or $12 a year for each subscriber, plus $3 or so for each dependent, $24 for a complete family. For this money the subscriber usually gets 1) hospitalization up to three weeks in a semiprivate hospital room, 2) operating room costs, 3) confinement expenses (some plans will not pay for a child born less than eleven months after the subscriber joins the plan). Last year the plans paid for the birth of 200,000 babies. Most hospitalization members are employe groups of big companies, clubs or unions. But some plans allow individuals to join. (Few give individual joiners maternity benefits.) Only ineligibles: people over 65, the chronically ill, mental cases. Special allowances for such patients and confinement cases are usually made where 75% or more of an employe or club group signs up.

Though its financial troubles seem to be licked and its popularity assured, the Blue Cross now faces a new potential threat: the Wagner bill, now in Congressional committee. Among other additions to present social-security laws, the bill proposes to provide hospitalization insurance for 100,000,000 U.S. citizens, which would knock the Blue Cross plans into the emergency ward.

*A group of nonprofit hospitalization insurance organizations which fulfill requirements of the American Hospital Association.

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