insurance

Blue Cross Blue Shield

A federation of independent health insurance companies operating under the Blue Cross and Blue Shield Association brand across the United States. These companies provide health insurance coverage through employer groups, individual plans, and government programs like Medicare and Medicaid.

Example

“Jennifer enrolled in her employer's Blue Cross Blue Shield plan, which provided coverage for both hospital stays through Blue Cross and doctor visits through Blue Shield benefits.”

Memory Tip

Remember 'Blue Cross = Hospital Costs, Blue Shield = Doctor Bills' - Cross for facilities, Shield for physicians.

Why It Matters

As one of the largest health insurance networks in America, BCBS plans are widely accepted by healthcare providers and offer extensive coverage options. Understanding their structure helps consumers navigate health insurance choices and maximize their benefits while minimizing out-of-pocket costs.

Common Misconception

Many people think Blue Cross Blue Shield is one national company, when it's actually dozens of independent companies that may have different coverage rules, networks, and benefits even within the same state. Others assume all BCBS plans are identical, missing important differences in coverage and costs between different local companies.

In Practice

Tom has Blue Cross Blue Shield of Michigan with a $2,000 deductible and 20% coinsurance. He needs surgery costing $10,000 at an in-network hospital. He pays the first $2,000 (deductible), then 20% of the remaining $8,000 ($1,600), for a total out-of-pocket cost of $3,600. The insurance pays $6,400, and because he used in-network providers, he receives the maximum benefit allowed under his plan.

Etymology

Blue Cross originated in 1929 from Baylor University Hospital's prepaid plan, with 'Blue Cross' symbolizing the humanitarian service of hospitals. Blue Shield began in 1939 covering physician services, with the shield representing protection.

Common Misspellings

blue cross blue sheildbluecross blueshieldblue cross blue shiledblue cross bleu shield

More in insurance

Other insurance terms you should know

deductibleThe amount you pay out-of-pocket before your insurance begin…insurance premiumThe amount paid periodically to an insurance company in exch…deductibleThe amount a policyholder must pay out of pocket before insu…copayA fixed amount paid by an insured person at the time of a me…coinsuranceA cost-sharing arrangement where the insured pays a percenta…out-of-pocket maximumThe most an insured person will pay for covered healthcare s…