Health · Chapter 14 · Traditional Plans
Blue Cross & Blue Shield (Service Providers)
Definition
Organized as service providers, not indemnity insurers: they pay participating providers directly at contracted rates instead of reimbursing the insured. Blue Cross = hospital expenses · Blue Shield = physician/surgical expenses. Members are called subscribers; premiums were traditionally community-rated.
In plain English
The Blues cut out the reimbursement paperwork — the hospital bills them, not you.
Exam tip
Two tested contrasts with commercial insurers: pays providers DIRECTLY, and community rating instead of experience rating.
Easy to confuse with
These are what this term gets tested against — if you can't tell them apart cold, drill the contrast.
Related terms