Short answer: If the employer has 20 or more employees, COBRA. If fewer than 20 and the plan is fully insured, Texas state continuation for up to nine months. A self-funded or level-funded plan under 20 has neither.
Federal COBRA does not apply to a plan for any year if the employer normally had fewer than 20 employees on a typical business day in the previous calendar year.
Texas state continuation (Insurance Code chapter 1251) applies to insured group coverage when coverage ends for any reason other than involuntary termination for cause, which cannot be health-related, if the person was continuously insured for at least three consecutive months before termination. The person must make a written request no later than the 60th day after coverage would end or after receiving notice of the right, whichever is later. It lasts up to nine months for someone not eligible for COBRA, or six more months after COBRA ends for someone who is.
Texas continuation does not apply to self-funded plans, so a level-funded small group can leave employees with no employer-side continuation. Their options are then a spouse’s plan through special enrollment or the individual market.