Blue Cross and Blue Shield of Maryland introduced a new plastic memory card yesterday designed to make life-saving medical data instantly available as well as to reduce card fraud and billing errors.

Each card contains a laser optical memory strip capable of storing 800 pages of medical history. A test program will begin in November with the 35,000 members of the Columbia Medical Plan, and all 1.6 million Blue Cross/Blue Shield subscribers in Maryland are expected to receive a LifeCard within two years. The Maryland health insurer also plans to franchise the card to other Blue Cross and Blue Shield plans around the country.

The wallet-size identification card, which carries standard subscriber information on one side, uses the same technology as the compact laser audio and videodiscs. Data on the card can be stored, retrieved and updated by computers.

In addition to medical text, LifeCard can reproduce X-rays and electrocardiograms. It also includes a digitized photograph of the subscriber, a reproduction of his or her signature and a description of medical benefits available under the patient's plan. No payment information is recorded.

According to Blue Cross/Blue Shield, LifeCard's primary medical use would be in hospital emergency rooms, while its most important administrative function would be to reduce fraud. Information stored on the card would prevent subscribers from lending cards to uninsured people desiring treatment.

The technology was adapted for medical use by a 19-year-old high school graduate, Douglas L. Becker. Health Management systems Inc., a subsidiary of Maryland Blue Cross/Blue Shield, assumed the $2 million in development costs.

To obtain a card, Blue Cross/Blue Shield patients must fill out a medical history that is then encoded on the card. The insured has complete discretion over what goes on the card and may elect not to list certain medical information, such as psychiatric or drug treatment. Once the information is encoded, it cannot be removed without destroying the card. Children's medical histories will be stored on their parents' card until they reach 13, when they will be given their own LifeCards.

A patient's primary physician would have access to all the data on the card, as would hospitals. However, pharmacists would have access only to a patient's medication record, the insurer said.

For added confidentiality, neither a hospital nor Blue Cross/Blue Shield would have a master copy of the patient's record. Subscribers, too, would be unable to read the information on their own cards.

The card -- which will be provided free to members -- costs between $1.50 and $2 to produce. The cost of software for physicians is approximately $1,500, Blue Cross/Blue Shield said; for hospitals, $3,000-4,000.