It’s usually the first thing a business owner asks, and the frustrating truth is that nobody can give you your real number without a quote. What we can give you is the next best thing: what Texas employers actually paid last year, what moves a quote up or down, and what to do if the number you get back is more than you planned for.
What Texas employers pay on average
The most reliable state-level figures come from the federal government’s yearly survey of employers, run by the Agency for Healthcare Research and Quality and published state by state by KFF. For 2025, the latest year available:
- Single coverage averaged $8,543 a year per enrolled employee, about $712 a month. Employers paid $6,905 of that and employees paid $1,638.
- Family coverage averaged $25,053 a year, about $2,088 a month. Employers paid $17,140 and employees paid $7,913.
- Employer
- Employee
Single coverage: $8,543
Employer $6,905 (81%) · Employee $1,638
Family coverage: $25,053
Employer $17,140 (68%) · Employee $7,913
Both bars on the same scale. Source: AHRQ MEPS-IC 2025, via KFF State Health Facts.
Two things stand out. Texas runs a little below the national average, which was $9,025 for single coverage and $26,281 for family in the same survey. But Texas employees pay more toward family coverage than employees nationally: $7,913 a year against $7,314. When the cost of covering a spouse and children climbs, employers here tend to pass more of it on.
KFF’s own national survey of small firms, those with 10 to 199 workers, lands in the same place: $9,211 for single coverage and $26,054 for family in 2025. It also shows how much harder family coverage hits at small companies. Workers at small firms paid an average of $8,889 a year toward a family plan, against $6,227 at larger firms.
What that looks like as a budget
Averages make more sense multiplied out. Ten employees on single coverage at the 2025 Texas average comes to about $85,430 a year in total premium. At the average employer share, your part would be about $69,050, roughly $5,750 a month, with your team paying the rest.
Treat that as a sense of scale, not an estimate. Your quote is built from your own people, and the next section is why it can land well above or below that.
Why your quote won’t match the average
For a small group plan in Texas (2 to 50 employees), federal rules limit what a carrier can price on. Each person’s age, where you are, tobacco use and who is covered (employee, spouse, children) can change the rate. Someone’s health can’t: a carrier can’t charge your group more because an employee is sick. Texas uses the federal limits and the federal age curve, so the same rules apply to every carrier here. Everything else comes from the plan you pick and how you split the cost.
Age matters most
Rates rise with each year of age on a set curve. For the same plan, a 40-year-old’s rate is about 28% higher than a 21-year-old’s, and a 64-year-old’s is three times as much.
Age 21
1.00×
Age 30
1.14×
Age 40
1.28×
Age 50
1.79×
Age 60
2.71×
Age 64+
3.00×
Source: CMS federal default standard age curve (Appendix I, December 2016). Texas has no state curve of its own, so the federal default applies.
That’s why two companies with the same headcount can get very different quotes. A crew whose average age is 30 will price well below an office where most people are in their fifties, on exactly the same plan.
Where you are
Carriers price by geographic rating area, and hospital prices and networks differ across the state. The same plan can cost a different amount in Houston than in Victoria, El Campo or Corpus Christi.
The plan you pick
This is the part you control. A higher deductible lowers the premium and moves more cost to the moment someone uses care. At small firms nationally, the average single deductible was $2,631 in 2025, and 53% of covered workers were in a plan with a deductible of $2,000 or more. Network matters too: a narrower network, such as an HMO, usually costs less than a broad PPO.
Who enrolls, and in what
In Texas, family coverage averaged almost exactly three times the cost of single coverage in 2025, so the mix of employee-only and family enrollments moves your total more than headcount alone. Tobacco use can raise a person’s rate by up to 1.5 times.
What you’re required to pay as the employer
Less than most people think, and the rules are worth knowing before you set a budget.
- No Texas law sets a general minimum employer contribution for small group coverage. In practice, most carriers won’t write the group unless you pay at least half of the employee-only premium. You don’t have to contribute anything toward spouses or children.
- At least 75% of eligible employees have to enroll for a carrier to offer small employer coverage. An eligible employee is one who usually works at least 30 hours a week. Carriers usually don’t count someone who turns the plan down because they’re covered elsewhere, such as through a spouse, but the rules vary by carrier.
- You can pay the whole premium if you want to. 29% of covered workers at small firms are in a plan where the employer pays the entire single premium.
Coming up: the participation holiday, November 15 to December 15. Every year, during this window, carriers have to offer small group coverage without applying their participation or contribution requirements, usually for a plan starting January 1. If you’ve been turned down for not getting enough people to enroll, this is your opening.
The small business tax credit is narrower than it sounds. It’s worth up to 50% of what you pay toward premiums, but only if you have fewer than 25 full-time equivalent employees, your average wages are under an annual limit the IRS sets, you pay at least half of employee-only coverage and buy through the SHOP Marketplace. You can only claim it for two consecutive years. Worth checking if you’re very small, rarely a reason on its own to choose a plan.
What’s happening to prices for 2027
Premiums are rising quickly, and Texas is above the national pace.
- For 2026, small group premiums went up a median of 11% across the country.
- For 2027, nearly 300 small group insurers proposed a median increase of 14% (KFF, August 2026).
- In Texas, the five carriers staying in the small group market requested an average increase of 16.9% for 2027. That’s a simple average of what each carrier asked for, not weighted by how many people each one covers, and three of the eight carriers in the Texas small group market appear to be leaving it.
The reasons insurers give are the same almost everywhere: higher prices for hospital care, doctors and prescription drugs, people using more care, and fewer small businesses in the small group pool as some move to other kinds of plan or stop offering coverage. Remember that these are requested increases, not approved ones, and that your own renewal also reflects your group.
If your renewal letter shows a number like these, it doesn’t mean your broker or your carrier did anything wrong. It does mean it’s worth checking what else is out there before you sign.
How to bring the number down
These are the levers that actually move a premium, roughly in the order we’d try them.
1. Get the whole market quoted, not just your renewal
Plenty of renewals get signed as they arrive. If nobody has quoted your group with other carriers in the last year or two, start there. Changing carriers mid-year is possible, and changing brokers doesn’t change your price: broker pay is built into every carrier’s rates, so your premium is the same with us or without us.
2. Look at level funding
With a level-funded plan you pay a steady monthly amount that covers expected claims, administration and stop-loss insurance, and you may get money back if your group’s claims come in low. It’s no longer unusual: 37% of covered workers at small firms are now in one. It can be noticeably cheaper for a younger, healthier group. The trade-offs are a health questionnaire up front and a renewal that can rise after a bad claims year.
3. Change the plan design, not just the carrier
A high deductible health plan paired with a health savings account lowers the premium and gives your team a tax-free account to cover the gap. For 2027, employees can put in up to $4,500 for self-only coverage or $9,000 for family coverage, and the plan’s deductible has to be at least $1,750 or $3,500. Or pair a higher deductible with an employer-funded HRA, so you pay for the first layer of costs yourself and still buy a cheaper plan. Many carriers also let you offer two plans side by side, a base plan and a richer one, with your contribution pegged to the base.
4. Rethink how you split the cost
Paying a percentage of every tier means your cost jumps every time someone adds their family. Many small employers pay generously toward employee-only coverage and offer a fixed dollar amount toward dependents instead. Given how much Texas employees already pay for family coverage, it’s worth doing this carefully rather than just passing on the increase.
5. Model an ICHRA, carefully
An individual coverage HRA lets you give each employee a set tax-free amount toward an individual plan they choose themselves, so your cost is fixed. It made more sense when individual plans were heavily subsidized. The enhanced federal premium tax credits expired at the end of 2025, so individual coverage costs many people more now, and it needs real numbers before it beats a group plan.
What you’ll need for an accurate quote
A real quote is quick once a carrier has the basics. Have these ready:
- A list of your employees with each person's date of birth, home ZIP code and the coverage they'd want (employee only, with a spouse, with children, or family).
- Your business ZIP code and the date you'd like coverage to start.
- Your current plan and renewal, if you already offer coverage, so you can compare apples to apples.
- Roughly what you'd like to contribute, even if it's a range.
- Proof that you have employees, which for most carriers means your latest quarterly wage report.
Send us that and a person who knows your plan will come back with real numbers from the carriers that fit your group, side by side, with the trade-offs explained in plain English. You can ask for a quote here.