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Health Insurance History – The New Jersey Connection [SPONSORED]

New Jersey has the bragging rights as a birthplace for a lot of different things.  We’ve partnered up with our friends at Horizon Blue Cross Blue Shield of New Jersey to show you just how important the connection between health care and the Garden State is.

NJ is the leader in healthcare
Sherman Hulton Archive via Getty Images

Our state is known as the birthplace of baseball. On June 19, 1846, the first baseball game was played in Hoboken’s Elysian Fields.

Intercollegiate football was also born in New Jersey, with Rutgers defeating Princeton at College Field in New Brunswick back on November 6, 1869.

Our state is also famous for having the nation’s first drive-in movie theater, the first motion picture studio and for being the first state to ratify the Bill of Rights.

Maybe you already knew about these “firsts,” but did you know that New Jersey can also stake a claim as being a birthplace of health insurance?

While a few single hospital pre-payment plans first began to take shape in the late 1920s elsewhere in the US, it was 80 years ago this month that the nation’s first multi-hospital prepayment plan was established in Newark to help New Jersey residents gain access to affordable health care.[1] These were tough times, when families and the medical community alike were in the economic grip of the Great Depression.  So on December 14, 1932, Associated Hospitals of Essex County, Inc. began selling prepaid hospital coverage for three cents per day.

One of the early driving forces behind this new idea was Frank Van Dyke, the Executive Secretary of Associated Hospitals of Essex, Inc., who once commented: “What a wonderful thing it would be if you could remove the cashier’s window from the hospital.[2]”  From that point forward, the idea of prepaid hospital coverage was born.

During its first year, 1933, Associated Hospitals, with employees working from a cramped office in Newark, enrolled 5,000 subscribers.  An annual premium of $10 bought members 21 days of prepaid hospital coverage.

In 1936, Associated Hospitals officially changed its name to the Hospital Service Plan of New Jersey.

The company would become one of the first Blue Cross plans in the country. Prepaid medical and surgical coverage – Blue Shield of New Jersey – followed in the 1940’s and the two companies merged in 1986. Today, that company is the same one who has helped us bring you all this great information, Horizon Blue Cross Blue Shield of New Jersey, the state’s oldest and largest health insurer.company serving more than 3.6 million members.

It is hard to believe that health insurance – a critical protection for most people – has only been around for a little more than eight decades in the United States.

So, we can thank the Garden State visionaries who brought us the Great American Pastime of baseball, the excitement of college football, the nostalgia of the drive-in movie and who led the effort to protect our Bill of Rights freedoms in the US Constitution.  We can also thank New Jersey innovators who helped to bring us the financial security and peace of mind that comes with health insurance coverage.

[1] Anderson, Odin W., Blue Cross Since 1929: Accountability in the Public Trust, Ballinger Publishing Company (1975), p. 33.

[2] Anderson, Odin W., Blue Cross Since 1929: Accountability in the Public Trust, Ballinger Publishing Company (1975), p. 33.

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