Texas Border Business
Texas Border Business
AUSTIN, Texas — The Texas Association of Business (TAB) on Monday endorsed Gov. Greg Abbott’s proposed Essential Health Benefits plan, saying it would allow Texas employers to offer group health insurance that meets all federal coverage requirements without additional state-mandated benefits that increase costs.
According to TAB, the proposal would expand affordable health coverage options by giving employers the choice to purchase federally compliant health plans without certain state-specific benefit mandates. The governor’s office estimates the proposal could save a typical Texas family about $1,145 annually and reduce small business health insurance costs by more than $3,400 per employee each year.
TAB said Texas ranks among the states with the highest number of health insurance mandates that exceed federal requirements. The organization said only 27% of small businesses currently provide health insurance to employees, a figure it described as steadily declining, while 16.6% of Texans remain uninsured, the highest rate among U.S. states.
The business organization said rising insurance costs have forced many small employers to choose between offering health coverage, hiring additional workers and investing in business growth. TAB said allowing employers greater flexibility to select federally compliant plans could make coverage more affordable for businesses and employees.
TAB noted it has supported similar legislation during multiple legislative sessions, including House Bill 139 by Rep. Jay Dean during the 89th Texas Legislature. According to the organization, the bill would have established an optional employer-choice health plan that preserved all 10 federally required Essential Health Benefits while allowing employers to forgo certain state-mandated benefits that increase insurance premiums.
“Texas employers have consistently made clear that the growing number of state health insurance mandates is driving up costs and undermining our state’s otherwise pro-business environment,” TAB said in a statement.
The organization said Abbott’s proposal “addresses those costs by giving businesses a meaningful new option to provide affordable, federally compliant coverage.”
“More affordable coverage means more employers can offer health insurance, more Texans can gain coverage through their jobs, and our small businesses can remain competitive,” the statement said.
TAB added that it has advocated for greater employer flexibility in health coverage and fewer state-mandated insurance requirements for several legislative sessions and said it looks forward to working with the governor and the Texas Legislature to advance the proposal during the 2027 legislative session.
