Medical Savings AccountsThese new accounts offer tax benefits, lower premiums and better financial health.

When Kris and Tammy Kloxin started Designs By Tammy, an Edmond,Oklahoma, flower shop, last January, the last thing they thoughtthey'd get is a good deal on health insurance. But earlier thisyear, the Kloxins purchased a new, high-deductible health-insurancepolicy and began contributing about $1,000 per year to a medicalsavings account (MSA) administered by their insurance company. Withfamily coverage and a $3,000 annual deductible, their totalhealth-insurance costs--including the policy premiums and MSAcontributions--have stayed the same.

The difference is the Kloxins' MSA contributions are fullydeductible from their federal income taxes. And if they don'tspend all the money in their MSA in a given year, they can leave itin the account for use in subsequent years while it accruestax-free interest.