Recently I've heard a great deal about HMO drug formularies that restrict patients' access to necessary pharmaceuticals?

Any high-deductible health insurance policy can qualify, as long as it meets the IRS requirements. In 2010, the deductible must be at least $1,200 for individuals or $2,400 for families, and the annual out-of-pocket expenses cannot exceed $5,950 for self-only coverage or $11,900 for family coverage, including the deductible and co-payments (but not premiums). Individuals can buy high-deductible policies on their own or through their employers.

If your employer offers a high-deductible health insurance policy, you may be able to make pretax contributions, like you would with a flexible-spending account. If you open the HSA on your own, your contributions will be deductible when you file your taxes, even if you don't itemize.

You can now deduct your contributions up to the $3,050/$6,150 limit -- plus an extra $1,000 if 55 or older -- regardless of the size of the deductible.

The tax benefits of both plans are quite similar, but there are several differences. The biggest and most important difference is that your HSA balances can roll over from year to year and continue to grow tax-deferred.

You can keep the money in an HSA account even after you leave that job, similar to a 401(k). But you will get stuck with a 10% (20% beginning in 2011) penalty -- plus an income-tax bill -- if you use any of the money for nonmedical expenses before age 65.

Sure. Anyone who has not signed up for Medicare can contribute to an HSA if he or she buys a high-deductible health insurance policy, and you can contribute an extra $1,000 in 2010 if you're 55 or older.

You can't make new HSA contributions after you start receiving Medicare, but you can still use the money in your account tax-free for medical expenses at any age. You'll owe income taxes on the money -- but no penalty -- if you withdraw the money for nonmedical expenses after age 65.