HB721

Regular Session

Relating to the applicability of certain laws requiring health care cost disclosures by health benefit plan issuers and administrators.

LowStandard timeline

Low Cost

Effective:2025-09-01

Enforcing Agencies

Texas Department of Insurance

Compliance Analysis

Key implementation requirements and action items for compliance with this legislation

Implementation Timeline

Effective Date: September 1, 2025
Compliance Deadline: August 31, 2025 (Systems must be updated to suppress disclosure tools for exempt plans by this date to ensure compliance with the new scope of applicability).
Agency Rulemaking: The Texas Department of Insurance (TDI) is expected to issue guidance defining "account-based health benefit plan" post-session. Watch for bulletins between May 2025 and August 2025 to clarify the boundaries of this definition.

Immediate Action Plan

1. Audit Plan Portfolio: Immediately identify all HRAs and account-based plans within your book of business.
2. Renegotiate Vendor Contracts: Contact transparency vendors and TPAs to carve out exempt populations from pricing models before the September 1 renewal cycle.
3. Update Member Portals: Schedule IT resources to remove "Cost Estimator" links from the user interfaces of exempt plans by August 31, 2025.
4. Monitor TDI Bulletins: Assign a compliance officer to track TDI definitions regarding "account-based plans" throughout Summer 2025.

Operational Changes Required

Contracts

Administrative Services Agreements (ASAs): Review agreements immediately. If you are paying a per-member-per-month (PMPM) fee for transparency compliance tools on HRA or account-based populations, renegotiate to remove these fees effective September 1, 2025.
Vendor Statements of Work: Third-Party Administrators (TPAs) must amend vendor contracts to exclude HRA and account-based plan volumes from data feed requirements, reducing technology overhead.

Hiring/Training

Customer Service Scripting: Update call center protocols. Support staff must be trained to inform HRA and account-based plan members that cost comparison tools are not statutorily required or available for their specific plan type.
No New Certifications: No new compliance certifications are required; this is a deregulatory action.

Reporting & Record-Keeping

Exemption Documentation: Maintain specific plan documents classifying benefits as "Health Reimbursement Arrangements" or "account-based plans." In the event of a TDI audit regarding missing disclosures, these documents serve as your primary defense under HB721 Section 1(c).
System Suppression: Disconnect automated reporting feeds for these specific plan codes to prevent "ghost data" from confusing members or regulators.

Fees & Costs

Cost Reduction: This legislation should result in a net decrease in administrative costs. Ensure these savings are realized by auditing vendor invoices starting September 2025.

Strategic Ambiguities & Considerations

The term "other account-based health benefit plan" in Section 1(c)(1) is undefined in the statute.

Risk: It is unclear if this exemption extends to Flexible Spending Accounts (FSAs) or Health Savings Accounts (HSAs) when decoupled from a High Deductible Health Plan.
Guidance: Until TDI issues formal rulemaking, adopt a conservative interpretation. Apply the exemption only to HRAs and strictly defined contribution arrangements. Do not categorize standard PPO/HMO plans with minor account features as exempt.

Need Help Understanding Implementation?

Our government affairs experts can walk you through this bill's specific impact on your operations.

Schedule Consultation

Information presented is for general knowledge only and is provided without warranty, express or implied. Consult qualified government affairs professionals and legal counsel before making compliance decisions.

Legislative Timeline

This bill's path through the Texas Legislature

TopicsInsurance Insurance--health & Accident

Official Analysis

View HRO Analysis View All Bill Documents

BILL ANALYSIS

H.B. 721

By: Leo Wilson

Insurance

Committee Report (Unamended)

BACKGROUND AND PURPOSE

The University of Texas Medical Branch (UTMB) Health Multi-Share Plan is a program that offers members the opportunity for basic health coverage to mitigate the inappropriate use of local emergency department care or no care at all. The UTMB Health Multi-Share Plan provides a set number of physician, urgent care, and emergency room visits, outpatient procedures, inpatient days, and ancillary needs, such as imaging and laboratory services. The bill author has informed the committee that the program has an enrollment cap of 500 members at any given time, as UTMB Health is financially at risk for all claims above the amount of premium generated, and that because the program is designed to reinvest all premium dollars collected into the administration and benefits, there is a very small program team and a modest budget.

State law establishes certain requirements for health benefit plan issuers and administrators relating to health care cost transparency, and the bill author has informed the committee that if required to meet these requirements, the program would no longer be viable given the anticipated costs and resources required to maintain such compliance. H.B. 721 seeks to address this issue by exempting certain regional or local health care programs, including the UTMB Health Multi-Share Plan, from those health care cost transparency requirements.

CRIMINAL JUSTICE IMPACT

It is the committee's opinion that this bill does not expressly create a criminal offense, increase the punishment for an existing criminal offense or category of offenses, or change the eligibility of a person for community supervision, parole, or mandatory supervision.

RULEMAKING AUTHORITY

It is the committee's opinion that this bill does not expressly grant any additional rulemaking authority to a state officer, department, agency, or institution.

ANALYSIS

H.B. 721 amends the Insurance Code to exempt a regional or local health care program that contracts with health care providers within the boundaries of the participating county or counties to provide health care services directly to the employees of participating small employers and those employees' dependents from statutory provisions requiring health care cost disclosures by health benefit plan issuers and administrators.

EFFECTIVE DATE

September 1, 2025.

House Authors

Rep. Terri Leo-WilsonRepublican · Primary Author

Coauthors (2)

Senate Sponsor

Sen. Mayes MiddletonRepublican · Primary Sponsor

Bill Text(with markup)

H.B. No. 721

View bill text in multiple formats on Texas Legislature website

Fiscal NoteView Original

	AN ACT
	relating to the applicability of certain laws requiring health care
	cost disclosures by health benefit plan issuers and administrators.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
	SECTION 1. Sections 1662.003(b) and (c), Insurance Code,
	are amended to read as follows:
	(b) Notwithstanding any other law, this chapter applies to:
	(1) a small employer health benefit plan subject to
	Chapter 1501, including coverage provided through a health group
	cooperative under Subchapter B of that chapter;
	(2) a standard health benefit plan issued under
	Chapter 1507;
	(3) a basic coverage plan under Chapter 1551;
	(4) a basic plan under Chapter 1575;
	(5) a primary care coverage plan under Chapter 1579;
	(6) a plan providing basic coverage under Chapter
	1601; and
	(7) [~~a regional or local health care program operated~~
	~~under Section 75.104, Health and Safety Code; and~~
	[~~(8)~~] a self-funded health benefit plan sponsored by a
	professional employer organization under Chapter 91, Labor Code.
	(c) This chapter does not apply to:
	(1) a health reimbursement arrangement or other
	account-based health benefit plan;
	(2) [or] a workers' compensation insurance policy; or
	(3) a regional or local health care program operated
	under Section 75.104, Health and Safety Code.
	SECTION 2. This Act takes effect September 1, 2025.

LEGISLATIVE BUDGET BOARD
Austin, Texas

FISCAL NOTE, 89TH LEGISLATIVE REGULAR SESSION


April 22, 2025

TO:	Honorable Jay Dean, Chair, House Committee on Insurance

FROM:	Jerry McGinty, Director, Legislative Budget Board

IN RE:	HB721 by Leo Wilson (Relating to the applicability of certain laws requiring health care cost disclosures by health benefit plan issuers and administrators.), As Introduced

No significant fiscal implication to the State is anticipated.

It is assumed that any costs associated with the bill could be absorbed using existing resources.

Local Government Impact

No significant fiscal implication to units of local government is anticipated.

Source Agencies:

327 Employees Retirement System, 529 Health and Human Services Commission, 710 Texas A&M University System Administrative and General Offices, 720 The University of Texas System Administration

LBB Staff:

JMc, AAL, BFa

Related Legislation

Explore more bills from this author and on related topics

Frequently Asked Questions

Common questions about HB721

What does Texas HB721 do?

HB721 creates a statutory exemption from health care cost disclosure mandates for Health Reimbursement Arrangements (HRAs), account-based plans, and certain local government health programs. Plan sponsors and administrators of these specific arrangements must cease disclosure protocols to reduce administrative overhead, while standard health plans and Professional Employer Organization (PEO) sponsored plans remain fully subject to transparency laws. Implementation Timeline Effective Date: September 1, 2025 Compliance Deadline: August 31, 2025 (Systems must be updated to suppress disclosure tools for exempt plans by this date to ensure compliance with the new scope of applicability).

Who authored HB721?

HB721 was authored by Texas Representative Terri Leo-Wilson during the Regular Session.

When was HB721 signed into law?

HB721 was signed into law by Governor Greg Abbott on June 20, 2025.

Which agencies enforce HB721?

HB721 is enforced by Texas Department of Insurance.

How urgent is compliance with HB721?

The compliance urgency for HB721 is rated as "low". Businesses and organizations should review the requirements and timeline to ensure timely compliance.

What is the cost impact of HB721?

The cost impact of HB721 is estimated as "low". This may vary based on industry and implementation requirements.

What topics does HB721 address?

HB721 addresses topics including insurance and insurance--health & accident.

Legislative data provided by LegiScanLast updated: November 25, 2025

Need Strategic Guidance on This Bill?

Need help with Government Relations, Lobbying, or compliance? JD Key Consulting has the expertise you're looking for.