Final answer:
A Health Savings Account (HSA) is combined with a high-deductible health plan to allow individuals to pay for medical expenses tax-free, which differs from HMOs that receive a fixed payment.
Step-by-step explanation:
The plan that combines a high-deductible fee-for-service plan with a tax-exempt trust to pay for qualified medical expenses is known as a Health Savings Account (HSA). This plan allows individuals to pay for current health expenses and save for future qualified medical and retiree health expenses on a tax-free basis. A high-deductible health plan (HDHP) is necessary to be eligible for an HSA. In this setup, the deductible is an amount that policyholders must pay out of their own pocket before insurance coverage pays anything. There is a difference between this and health maintenance organizations (HMOs), which are paid a fixed amount regardless of the services provided.