Employer Health Coverage in Texas — By Company Size
Employer health coverage in Texas, organized by company size. The arrangements available to you change sharply at 50 employees and again at 500, so start with your headcount.
Find Your Size
What makes sense for an employer in Texas depends almost entirely on headcount. A ten-person shop and a four-hundred-person company are not solving the same problem, and the arrangements available to them barely overlap. Start with the column that matches you.
Under 50 Employees
No federal requirement to offer coverage, so this is a hiring and retention decision rather than a compliance one. Fully insured plans and PEO arrangements are the usual starting points, and an HRA can let you fund individual coverage instead of buying a group plan at all.
Start with fully insured50 to 499 Employees
At 50 full-time equivalents the employer mandate applies and the reporting obligations come with it. This is also the size where level-funded designs start to pay off, because your own claims experience begins to matter more than the carrier's book.
Start with level-funded500+ Employees
Large enough to bear real risk and keep the savings. Self-funding, group captives and layered structures become genuinely viable, with stop-loss coverage protecting against the catastrophic claims.
Start with self-funded
How the Plan Is Funded
Every arrangement below is a different answer to one question: who carries the risk when claims come in higher than expected. That choice drives cost, predictability and how much administration lands on you.
Fully Insured
You pay a fixed premium and the carrier carries all the claims risk. The most predictable option and the least administrative work, which is why it is where most small employers start.
Read the guideLevel-Funded
You self-fund claims up to a cap but pay a steady monthly amount, so cash flow looks like a fully insured plan while good claims years come back to you.
Read the guideSelf-Funded
You pay claims directly and buy stop-loss coverage for the catastrophic ones. The most control and the most upside, and it requires real reserves and administration.
Read the guideGroup Captives
Several employers pool into a shared insurance entity, spreading risk wider than any one of them could alone while keeping underwriting profit in the group.
Read the guideMEC Plans
Minimum essential coverage designed to satisfy the employer mandate at the lowest cost. Thin by design, and the tradeoffs are worth understanding before choosing it.
Read the guideGroup Plans Overview
How employer group coverage works in Texas generally: eligibility, waiting periods, contribution rules and what changes as you grow.
Read the guide
Alternatives to a Group Plan
Buying a traditional group plan is not the only way to get employees covered, and for some employers it is not the best one.
HRA (ICHRA, QSEHRA)
Instead of buying a plan, you give employees a tax-free allowance to buy their own individual coverage. Costs are fixed and predictable, and employees choose their own plan and keep it if they leave.
Read the guidePEO (Co-Employment)
A professional employer organization becomes the co-employer of record, which gets a small company access to large-group rates along with payroll and HR administration.
Read the guideAssociation Health Plans
Small employers in the same industry or region band together to buy as a single larger group. Availability depends on state rules.
Read the guideSupplemental Coverage
Dental, vision, accident, hospital indemnity and critical illness coverage layered on top of a medical plan, often employee-paid.
Read the guide