health insurance tax exemption

Federal tax exemption for health insurance?

What does it mean when there is "federal tax exemption for health insurance".. in simple words so i can understand clearly.. thank you.

Health insurance premiums are not taxed at all under the following situations:

1. The taxpayer is employed and pays his health insurance premiums out of his pay before he pays taxes on his pay. This is "pre-tax".

2. The taxpayer is self-employed and pays health insurance out of his net profits.

But there is no general exemption from federal tax for health insurance premiums.