FHA Mortgage Insurance is a "fee" that you pay to insure against the risk of default. It has two parts: the initial, one time premium is 1.75 percent of the total loan paid upfront. It is NOT an out of pocket expense and just added to your loan balance at closing. The other is an annual premium broken into monthly installment and is included as part of the total monthly loan payment.
FHA Mortgage Insurance is not tax deductible and the monthly premiums generally translate into ~1.50% in interest rate. So, the goal with an FHA loan is to refinance into a conventional as soon as you hit the 20% equity mark.
The only way to eliminate FHA PMI is to refinance out of the existing loan into a new loan. If your existing loan originated before June 3, 2013, you may be able to contact your lender directly to drop the PMI.