Short answer: Individuals covered under a fully insured Texas group medical plan for at least three consecutive months before losing coverage may qualify for Texas State Continuation, unless coverage ended due to termination for cause.
To be eligible for Texas State Continuation, the individual must have been covered under a fully insured group medical plan issued in Texas. Coverage must have been in effect for at least three consecutive months immediately before eligibility was lost.
The loss of coverage must not be due to termination for cause. A termination related to misconduct generally disqualifies an individual, but termination for medical reasons does not count as termination for cause under Texas continuation rules.
Eligibility is not limited to employees. Former employees may qualify, as well as spouses and dependent children who lose coverage due to events such as death, divorce, retirement, or other qualifying losses of eligibility.
Texas State Continuation applies to fully insured group medical plans regardless of employer size. COBRA eligibility does not eliminate eligibility for Texas State Continuation. For small employers not subject to COBRA, Texas State Continuation may be used as the primary continuation option. For larger employers with fully insured plans, Texas State Continuation may apply after COBRA coverage ends.
Texas State Continuation does not apply to self-funded plans and does not include standalone dental, vision, or other non-medical benefits.
Sources
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Texas Department of Insurance, State Continuation of Coverage
https://www.tdi.texas.gov/pubs/consumer/cb046.html -
Texas Insurance Code §1251.251–1251.257
Content history
Originally published: June 16, 2025
Last reviewed: January 25, 2026