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This Web site contains a compilation of more than a thousand consumer finance  columns written by Tony Novak from the 1980s through 2006, updated and reformatted for maximum usefulness today.  New material was added after 2010.

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originally posted: 11/22/2006  reposted: 2/18/2011 This post has not been recently reviewed or revised by the author and may be out of date. If you notice an error or are in doubt, please send a new question by email or ask for an update. Email

Q: Regarding your recent answer to an inquiry regarding low cost insurance from Blue Cross in which you said: "This is apparently just a new e-mail spam campaign with no basis in reality. Blue Cross is an managed care provider that averages prices among its membership pool but does not issue low cost health insurance." Blue Cross in Pennsylvania does offer Adult Basic and Special Care, both low cost policies for people with low incomes.

A: Yes, Independence Blue Cross and Blue Shield operating in eastern Pennsylvania as well as some of the other Blue Cross associations in other parts of the country do offer reduced cost health plans where eligibility is based on income. In some cases single adults earning a full salary can qualify for this reduced cost coverage. It is a great deal for those who quality. The basic point of the original writing is that it appears that e-mail marketers are incorrectly using the Blue Cross name for some other purpose. A person who is shopping for health insurance - who are not usually in the low income category - would generally not consider Blue Cross to be one of the limited benefit / reduced cost insurance providers. So in this case the promise of "low cost health insurance from Blue Cross" is really a false advertisement where the marketer has no intention of offering a Blue Cross product. The original question stemmed from FreedomBenefits's involvement in two distinct services; 1) the low cost health insurance offered online and 2) personal enrollment assistance for other types of health plans that is useful in special situations but has nothing to do with the low cost insurance. Someone had apparently read an e-mail advertisement (from some spammer not associated with Blue Cross or and then decided to check out the possibility of finding low cost health insurance from a reputable source but does not promote or imply that Blue Cross is one of the nation's lower cost health insurance providers. We recognize that the basic strategies used to reduce health insurance costs including using selective medical underwriting with exclusion riders, eliminating benefits that are not likely to be used, customizing benefits for each enrolled person, avoiding managed care plan designs and using high deductibles, are all in conflict with the underlying business model and belief of the Blue Cross associations. But Blue Cross is still an invaluable resource for millions of Americans who better suited to managed care plans.


More resources:

Six Strategies for Cutting Health Insurance Costs