If you run a self-funded health plan in Texas, there is a choice available to you that many employers, and many of the people advising them, have never heard of. You can elect to bring your plan under the Texas balance-billing and out-of-network dispute process.
It has been available since September 1, 2023. One piece of it covers something federal law does not cover at all. And the whole thing is narrower than its name suggests, which is where the trouble starts.
Start with the part federal law misses: ground ambulance
The federal No Surprises Act ended a lot of surprise billing. It covers emergency care, out-of-network providers at in-network facilities, and air ambulance.
It does not cover ground ambulance. Congress left ground ambulance out, and it is still out. For most people in most states, an out-of-network ambulance ride remains one of the few places a surprise bill can still land with full force.
Texas has addressed this for the plans its balance-billing chapter reaches, and since 2023 that can include a self-funded plan that elects in. The section covering it applies to ground emergency medical services and specifically excludes air ambulance, precisely because air is already handled federally.
Two things to know about it. It sets how much the plan must pay: the rate the local political subdivision has filed with the state where there is one, and a formula tied to the Medicare rate where there is not. And it expires on September 1, 2027 unless the Legislature extends it. That sunset is in the statute itself. If this is part of why you opt in, put the date somewhere you will see it.
How the opt-in works
Texas Insurance Code Chapter 1275 prohibits balance billing in certain situations and routes out-of-network payment disputes into the state’s independent dispute resolution process. For years it applied only to health plans offered by nonprofit agricultural organizations.
House Bill 1592, passed in 2023, changed one thing: it amended the chapter’s applicability section so a self-insured or self-funded ERISA plan can elect to be covered by it. (A 2025 bill later added a third category, for plans offered by postsecondary educational institutions.)
That is the whole mechanism. The plan sponsor makes an election, submits it to the Texas Insurance Commissioner in the form the Commissioner prescribes, and the chapter applies to the plan for that plan year.
Two details in the statute that matter more than they look
The election is annual. The statute says the election applies “for the relevant plan year.” Not once, and not permanently. Per plan year. “We opted in a couple of years ago” is not an answer to “are we opted in right now?” If you are relying on this protection, someone has to confirm the election is current for the plan year you are actually in.
The election goes to the Commissioner. This is not an internal decision recorded in a plan document. It is a filing, in a prescribed form. A plan that decided to opt in but never submitted anything has not opted in.
What you actually get
Chapter 1275 covers:
- a required balance-billing prohibition notice to enrollees and providers;
- payment rules for out-of-network emergency care;
- payment rules for out-of-network facility-based providers at a participating facility;
- payment rules for out-of-network diagnostic imaging and laboratory providers;
- payment rules for out-of-network ground emergency medical services (through September 1, 2027);
- and access to the Texas out-of-network dispute resolution process.
Two of those (facility-based providers and imaging/lab) have an exception where the patient signs a written advance consent after a full disclosure of projected costs. If your people are signing forms at a registration desk without reading them, that exception is where the protection quietly goes away.
What you do NOT get, and this is the part that catches people
Opting in does not make your self-funded plan subject to Texas insurance mandates generally.
The chapter’s own title is “Balance Billing Prohibitions and Out-of-Network Claim Dispute Resolution for Certain Plans.” It sits in the managed care part of the Insurance Code, not the mandated benefits part. Every one of its sections is about out-of-network billing. There is no section about eligibility, enrollment, dependents, or covered benefits, so electing into it cannot bring any of that with it.
Here is the concrete example that is live right now. Texas Senate Bill 896 extends the enrollment window for a newborn: coverage runs through the 61st day after birth unless the plan gets notice of the birth, and any additional premium, by the 60th day. It applies to plans delivered, issued, or renewed on or after January 1, 2026.
A self-funded plan that has opted into Chapter 1275 is still not subject to that newborn window. SB 896 amends entirely different parts of the Insurance Code: the sections governing MEWAs, small and large employer group coverage, and child coverage. It does not touch Chapter 1275. The opt-in door does not open onto it.
That distinction is not academic. Tell an employee on a self-funded plan they have 60 days to enroll a newborn when the plan’s actual window is shorter, and the consequence is not a paperwork problem. It is a baby without coverage and a family with a bill.
One exception worth knowing
If the coverage is through a MEWA, the newborn rule does apply. SB 896 amends the MEWA section directly. “Self-funded-ish” arrangements are not all the same thing, and this is one of the places the difference shows up.
What to actually do
- Find out whether your plan is opted in for this plan year. Not whether it ever was. This year.
- If you’re weighing it, ground ambulance is probably the strongest argument, and the sunset date is part of that argument, not a footnote.
- Ask your TPA and your stop-loss carrier before electing. The election changes how out-of-network emergency, facility-based, imaging/lab, and ambulance claims get paid and disputed. That is an administration question before it is a legal one.
- Do not let “we opted into the Texas process” become shorthand for “Texas rules apply to us.” Write down what the election does and does not cover, so the next person reading the file does not have to guess.
- Handle newborn enrollment on its own terms. Whatever your plan’s rule is, make sure the enrollment materials say it plainly, and make sure whoever answers the phone knows it.
The short version
The opt-in is real, it is annual, and it is narrower than it sounds. It buys the Texas balance-billing protections and the state dispute process, including ground ambulance, which federal law does not reach. As the statute currently stands, that ambulance protection runs only until September 2027. It does not make a self-funded plan subject to Texas mandates generally. Both ways of getting this wrong cost somebody real money.
This is general information about compliance obligations, not legal advice. Confirm your plan’s specific situation with your benefits counsel or your TPA.