Health Savings Accounts are like Individual Retirement Accounts for health care.

HSAs were created by Congress in 2003 so that workers could cover some of their medical costs with pre-tax money if they have high-deductible health insurance plans.

A Health Savings Account (HSA) is a tax-advantaged medical savings account available to taxpayers in the United States. HSAs were established as part of the Medicare Prescription Drug, Improvement, and Modernization Act which was signed into law by President Bush on December 8, 2003. These accounts are a component of consumer-driven health care plans.

HSAs are marketed as an "alternative" to traditional health insurance as they are actually savings accounts (and can also be investment vehicles) instead of health insurance plans. However, in order to contribute to an HSA, the account owner must be enrolled in a High Deductible Health Plan (HDHP). HSA account owners who are not enrolled in HDHPs may use funds in the account but may not continue to make contributions. Further, in order to receive the tax advantages, funds in an HSA must be used for specific qualified medical expenses. 

 See also:

Health Reimbursement Arrangement, an HSA cousin.

High-deductible health insurance plans.