1959

Congress passes Federal Employees Health Benefits Program, which became effective 1 July 1960. It provided for “controlled competition,” with federal employees offered a choice between Blue Cross/Blue Shield; commercial indemnity insurance from a syndicate headed by Aetna; and whatever other prepaid group plans available in their area; each plan offered two benefit tiers, and a third tier for major medical coverage was also allowed (Cunningham, 111-113). The Blue Cross/Blue Shield offering, the Federal Employee Program (FEP), enrolled one million federal workers plus their dependents, “the largest single group ever enrolled by an insurance carrier” (116).