Tex. Education Code § 22.005

(a) The board of trustees of a school district may establish a health care plan for employees of the district and dependents of employees.

(b) In implementing the health care plan, the board shall establish a fund to pay, as authorized under the plan, all or part of the actual costs for hospital, surgical, medical, dental, or related health care incurred by employees of the district or any dependent whose participation in the program is being supported by deductions from the salary of an employee. Under the plan, the fund also may be used to pay the costs of administering the fund. The fund consists of money contributed by the school district and money deducted from salaries of employees for dependent or employee coverage. Money for the fund may not be deducted from the salary of a school district employee unless the employee authorizes the deduction in writing. The plan shall attempt to protect the school district against unanticipated catastrophic individual loss, or unexpectedly large aggregate loss, by securing individual stop-loss coverage, or aggregate stop-loss coverage, or both, from a commercial insurer.

(c) The board may amend or cancel the district's health care plan at any regular or special meeting of the board. If the plan is canceled, any valid claim against the fund for payment of health care costs resulting from illness or injury occurring during the time the plan was in effect shall be paid out of the fund. If the fund is insufficient to pay the claim, the costs shall be paid out of other available school district funds.