Fully Insured Group Health Plans
The traditional model: fixed monthly premiums, carrier assumes all risk. Straightforward to administer and budget for. The right starting point for many Texas employers, and the right long-term structure for others.
Predictable costs, carrier-backed risk: the fully insured structure explained
With a fully insured group health plan, the employer pays a fixed monthly premium to a health insurance carrier. In exchange, the carrier assumes all financial risk for employee claims. If claims run high, the carrier absorbs the difference. If claims run low, the carrier keeps the surplus.
Small group vs. large group in Texas
ACA compliance and the 50-employee threshold
Under the ACA, employers with 50 or more full-time equivalent employees (FTEs) are "Applicable Large Employers" (ALEs) and are subject to the employer shared responsibility mandate, meaning they must offer affordable, minimum value coverage to full-time employees or potentially face penalties. Employers approaching 50 FTEs should track their count carefully and discuss ACA implications with their advisor well in advance.
Employers on fully insured plans still have administrative and compliance obligations: ERISA requirements (for plans not subject to state law), COBRA administration, HIPAA compliance, nondiscrimination testing, and more. Fully insured reduces financial risk, not compliance responsibility.
What to look for when comparing fully insured plans
- ✓Network adequacy: Does the carrier's network include the doctors and hospitals your employees actually use? Texas has wide variation in network coverage by region.
- ✓Premium stability: What's the carrier's renewal trend in your region? Consistent renewals matter as much as the initial rate.
- ✓Plan design: Deductibles, copays, coinsurance, OOP maximums, and HSA-eligibility for HDHPs. The plan that fits your employee demographics matters.
- ✓Carrier service quality: How does the carrier handle claims disputes? Is there a dedicated group service line? This matters when your employees are in-network and can't get a prior auth.
When fully insured makes the most sense
Fully insured is often the right structure when the group is small (under 25–30 employees), when recent claims history has been challenging, or when the employer prioritizes simplicity and administrative ease over cost optimization. As groups grow, level-funded and self-funded structures often become more competitive, and we model all three at renewal so you have the comparison in front of you.
Is your current health plan still the right structure for your group?
As your business grows and your workforce changes, the optimal benefits structure can shift. Let us run the numbers and show you the comparison.
Content on this page is for general educational purposes only. ACA rules and thresholds are subject to change. Consult a licensed insurance professional and qualified legal or benefits counsel for current requirements applicable to your business. All plan descriptions are general in nature; actual plan documents govern.