TDA’s member-owned insurance agency presents its annual update to help you prepare for open enrollment and see an overview of healthcare options for 2027 in the individual and small group markets.
The ACA’s subsidies and eligibility have reverted back to previous levels for the Affordable Care Act (ACA) individual plans. There are less companies offering plans in Texas and some new options to consider.
Rate Changes: Individual HMO—Increases, Small Groups—Bigger Increases
Filed rates are being reviewed to determine if proposed increases are based on reasonable cost assumptions and claims data. Final rates won’t be available until the middle of October but definitely before Nov. 1 when open enrollment starts, so you can’t really start comparing until then.
Individual Plans
Blue Cross is the only company offering individual plans statewide in Texas. These plans are HMO only, however they do offer their Plus plans (or POS Plan) which is still an HMO but provides coverage outside of the network, however with higher deductible and out of pocket maximums. They will have one of the lower increases -projected to be under10%. United Healthcare offers plans with coverage in most parts of the state but will have a significant increase (potentially above 25%). Other companies that are more regional or county specific are also increasing rates significantly so keep a look out for your renewal. If you need to switch companies, we strongly suggest you get it done well before the deadline.
There are no ACA-compliant individual PPO plans in Texas available statewide. There are regional or local plans available in Texas, which are mostly HMOs; and in limited areas of the state where a hospital system has several facilities such as Scott & White or Memorial Herman and offers a plan. There are other companies offering plans in a few select regions of the state such as Molina, Oscar, Community Health, Imperial Health and Sendero.
Keep in mind the network being offered, as it could have limited or no coverage in parts of the state. Most of the plans are incorporating tele-med, direct primary care, or concierge medicine as part of the coverage.
Tele-med allows for virtual visits with your physician that may or may not have a copay. Direct primary care and concierge arrangements typically provide certain services—such as an annual physical exam and specified treatment for a specific condition—and often don’t qualify as insurance, as essentially you are pre-paying for a service. Virtual primary care sessions can include some prescriptions, durable medical equipment, lab tests, and diagnostic imaging.
Again, it’s very important to understand the scope of the networks, the coverage, and limitations, especially if you’re seeing specialists for an ongoing medical condition.
ACA subsidies or premium credits
The ACA’s health insurance premium subsidies—also known as premium tax credits—normally adjust each year to keep pace with premiums.
New rules also tighten up eligibility for subsidies and eliminate it if you don’t file your federal income tax or reconcile your income with your subsidy amount annually.
Small group plans continue to be the only option for getting true PPO plan options under the ACA. Unfortunately, this year will have the lowest number of companies offering Group plans since the ACA became effective in 2014.
Of the companies left we anticipate Blue Cross will have the lowest rates—their filed rate increase for the PPO is 17.59% and their HMO will increase by almost 25%; United Healthcare rates will increase approximately 16%.
Other Coverage Options
Healthcare Member Benefits
TDA members have access to a Healthcare Member Benefits Program that utilizes a national PPO network and is available in all 50 states.
- Coverage cannot be denied
- Available to 1099 contractors and sole proprietors
- Available to Staff
- Must be a TDA member in good standing and actively working
For more information, contact the Concierge team at 833-287-4765.
Small-Group Plans
More Plan Options, PPO, and HMOs Available
If you have a practice with at least one other full or part-time employee, you should consider a small group plan.
Depending on how your practice is structured, the other employee could be your spouse. Contact TDA Financial Services Insurance Program at (800) 677-8644 for details.
Why go through the additional paperwork and effort for a small group?
- Small group plans will be less expensive than unsubsidized individual plans, and you can still get a PPO.
- If you sign up during the special enrollment for new small groups (starting Nov. 1), the mandatory employer contribution towards employee premiums (as well as other requirements) is waived. This is a good way to attract and retain high-quality employees while offering a lot of flexibility on plan designs.
- If you payroll deduct the employee premiums, it saves the practice and employees on taxes.
- You can offer more than one plan (up to 6) within your group—a base plan that’s less expensive for employees (perhaps an HMO with an RX and office copay), and a PPO plan for you and your family.
We can start comparing rates for small group plans beginning October.
2027 Maximum Out-of-Pocket Amounts
In-network
- $12,000 for an individual
- $24,000 for a family
High-deductible plans intended to be HSA-compatible
- $8,700 for individual coverage
- $17,400 for family coverage
Out-of-network
If you have out-of-network expenses, the maximum can be double what’s listed above, or more. Or the out-of-network expenses might not even be covered. The plans with the lowest premiums will have the highest out-of-pocket expenses.
Remember, rates are important, but so are providers.
It is critical you check the network of the insurance company you select for 2027 and make sure your providers and hospitals are in-network. You need to know the company name and the network name. Some providers, for instance, might take a Blue Cross PPO, but not Blue Cross HMO or United Healthcare Choice Plus but not the Choice Network.
Other Health Insurance Options in 2027
Level-Funded Plans
United Healthcare is very strong in level funded plans and have changed some of the requirements for smaller groups. If your practice and its employees are generally healthy and not big users of health care, you might want to consider a level-funded plan. These are underwritten based on the health of the group and can be as much as 10 to 25% lower than regular ACA small group plans.
Keep in mind only about 50% of groups will qualify based on underwriting but the rate savings can be significant, so worth considering. Also, these plans typically don’t qualify for the special enrollment, so the practice has to pay 50% of the employee premium and meet a participation requirement regarding the number of eligible employees that participate. Additionally, there are other considerations, such as the different PPO networks, stop loss coverage, and just understanding how the plans work and what’s covered.
Faith-Based, Medi Share and Health-Share Groups
These types of plans are not insurance and should not be considered a substitute for insurance but can be an option if you understand how they work. With these types of arrangements, you join a group and pay or contribute a monthly amount to a plan. After your deductible is met, you submit your medical bills and are reimbursed from the funds available or through others making additional contributions to cover your bill.
Many have incorporated a PPO network, so you can get the discounted amount when you have treatment. However, remember you are still responsible for the bill, even if the health-share plan might reimburse you.
These arrangements also have stricter guidelines than traditional insurance companies and on which procedures are eligible for reimbursement or cost sharing. There’s normally a lifestyle guideline where a member agrees to live a certain way (abstain from illegal drug consumption, sex outside of marriage, tobacco use, and abuse of alcohol or prescription drugs).
The payments of medical bills through these arrangements are not guaranteed in any way. Each member is always solely responsible for the payment of his or her own medical bills.
If you understand how the plans work and their limitations, these can be a less expensive option than ACA plans.
Short Term Medical
We don’t recommend you go without insurance, but short-term health insurance can be an option if you are without coverage because of a waiting period, you’re transitioning from one plan or coverage to another (e.g., in-between jobs), it’s outside the open enrollment period, or you’re close to being eligible for Medicare.
These plans are exempt from the definition of individual health insurance coverage under ACA provisions and usually don’t pay for pre-existing conditions. They’re designed to cover a new sickness or accident (with no treatment in the previous five years).
They also have limitations on coverage (e.g., no maternity coverage) and don’t have all the same mandates, such as unlimited-benefits maximums. These plans’ duration limits have changed significantly from administration to administration. The duration limit had been a 3-month limit; the current administration released a statement saying they do not intend to prioritize enforcement of this limit, so you should be able to have longer duration for 2027.
Limited Benefit Sickness-and-Accident Plans
These plans are sometimes called “mini-med plans,” and are marketed as an ACA alternative with a PPO. They may offer copays and RX benefits and may include “Minimum Essential Coverage (MEC)” benefits required by the ACA.
These types of plans may include a PPO or a PPO with referenced based pricing for hospital charges. Some provide a schedule of benefits that pay a certain amount per day or treatment; and are limited to a maximum amount. A company selling these plans will often address this limitation by selling additional coverage for critical or specified illness or accidents.
These plans are underwritten based on good health and have some form of pre-existing condition limitation, which means anything you’ve previously been treated for is not covered for a period—normally 12 months but can be up to 5 years. Remember taking meds for a condition or conditions does not mean you still do not have a condition, just that it is controlled with meds. You should remember this when answering any health questions to avoid having any claims denied. If a plan is guaranteed issue with no pre-existing condition, make sure you’re not just buying a discount plan—meaning you have access to PPO pricing, but the plan doesn’t pay the actual charges.
These plans can be an option; however, you need to understand the limitations and coverage, as you could be responsible for tens of thousands of dollars—even though you are covered—if you have a major accident or illness.
Additional Options and Considerations
If you are concerned about having a high deductible, limited, or no out-of-network coverage, you might consider a supplemental product for accidents or hospital confinements. These types of plans pay you directly and in addition to your other coverage. They tend to be relatively less expensive and are a good option if you don’t want to self-insure high-deductible and out-of-pocket expenses.
HSA Plans
When picking a plan, keep the above numbers in mind, but also consider the following. Prescription-drug and office-visit copays are convenient plan features, but you need to know the combined cost of your total out-of-pocket exposure and your plan (the premium).
If you haven’t looked at HSA plans or didn’t think they made sense previously, you should revisit them.
- HSA plans offer the lowest premium and can be a great way to build up a self-funding account for current and future medical expenses. This can be especially important if you have to go out-of-network.
- Contributions are tax deductible (as much as $4,500 for an individual/$9,000 family base limits; with a $1,000 catch-up available for those 55 and older).
- Expanded eligibility: Individuals with Bronze or Catastrophic Affordable Care Act (ACA) plans are eligible to contribute to an HSA.
- In 2027, Direct Primary Care (DPC) arrangements with specific monthly fee limits will be considered qualified medical expenses, and having a DPC arrangement won’t prevent HSA contributions. Also, first-dollar coverage for telehealth for virtual care are now HSA-compatible.
- Earnings and interest accumulate tax-free.
ICHRA
Individual Coverage HRA (ICHRA) presents an opportunity for employers to take more control over their benefits spend. ICHRA allows them to set aside tax-advantaged dollars to reimburse their employees for individual health insurance plans that are inflation-resistant compared to group plan premiums.
ICHRA brings more cost control and less risk for the employer and more purchasing power and choice for employees. However, keep in mind that the individual health insurance plans offered are going to probably be HMO only, so no PPO and the individual HMO plans are 10–15% higher than the group HMO plan if unsubsidized.
There is also the administration and set-up involved with ICHRA which is not particularly burdensome but does add additional administration on behalf of the practice.
HRAs
Use of Health Reimbursement Accounts (HRAs) has expanded because new regulations issued by the Departments of Labor, Treasury, and Health and Human Services, now allow reimbursements for individual-market insurance premiums.
Before employers offer a benefit that includes individual HRAs, they should consider the implications related to the (ACA) employer shared-responsibility mandate, and the ability of their employees to obtain a premium tax credit (PTC) or subsidy on the ACA marketplace. Because of this indexing methodology, the maximum new-contribution amount for an excepted benefit HRA remained $2,250 for 2027 plan year.
2027 Landscape Review
If you want or need full coverage, the small group market is still the best way to get coverage with more options available at lower cost than in the unsubsidized individual market.
The alternative options discussed all have a place at the table, but you need to make sure you understand plan limitations and risks before making a change to something less expensive. Stay informed and get ready to review and compare your options and make a decision as soon as possible. You will be able to review individual plans and rates beginning Nov. 1, and small group plans and rates in early October.
Important Dates
The open enrollment period for health plans offered under ACA begins Nov. 1, 2026, and ends Jan. 15, 2027. For individual plans, you will have until Dec. 15 to pick or change to a new plan with a Jan. 1 effective date or until Dec. 31, if your plan terminates Dec. 31.
Disclaimer: This article was submitted the first part of September, so some information may have changed by the time this article is published. If you would like to receive more information or discuss available insurance options, please feel free to contact TDA Financial Services Insurance Program at (800) 677-8644 or visit www.tdamemberinsure.com.
Please note: This article was submitted in late August, so some information may have changed by the time this article is published.