A Texas School District Adds $0 DPC and Drops Its HSA Option

On January 1, employees on a Pflugerville ISD medical plan in Texas get a direct primary care clinic they pay nothing to use. The same day, according to the district’s open enrollment page, Blue Cross coverage is gone, MDLive is gone and so is the Health Savings Account option.

That last item deserves a second look. Since January 2026, federal law has let DPC and HSAs sit together, within limits. A school district of about 24,700 students just bought DPC for its staff and stopped offering the account in the same plan year.

Nothing DPC Insider found in the district’s benefit pages or board reports connects those two decisions. Those documents are unusually complete on everything except the price.

A $5 million hole

The plan is self-funded, so rising claims land on the district’s own books. At a May 1 review, Blue Cross projected medical costs up about 12% for the 2026 plan year and pharmacy costs as high as 14%. The drivers it named were cancer diagnoses and treatment costs, mental health use and a growing group of claimants above $100,000 a year. The district’s own summary: “The current medical plan is operating at a financial loss that is not sustainable long term.”

By August the Finance Committee was working on “a projected $5 million plan-year deficit” through “network consolidation, plan design changes, and modest premium adjustments.” A separate board report says the move to Healthcare Highways and the clinic are “intended to reduce costs and close the funding gap.”

The district’s wider budget has a gap of its own. Community Impact reported in October that the district’s projected shortfall stood at $11 million, with enrollment down 342 students.

Network consolidation means this: four plans across two carriers in 2026 become three Healthcare Highways plans in 2027. A 2024-25 district purchase item calls the Healthcare Highways network “a High-Performance, Narrow Network,” and the 2027 benefits guide is plain that care outside it isn’t covered.

“Modest” is the district’s word for the premiums. Here’s the employee-only monthly rate and the rise from 2026:

Plan	Deductible	Primary visit	Specialist visit	Employee-only premium	Change
High	$2,000	$35	$50	$285	+$25
Mid	$4,000	$40	$60	$127	+$38
Low	$6,000	$50	$80	$50	+$10

The Mid plan’s $38 sits on an $89 base, a rise of about 43%. Employee-plus-family coverage runs $1,000 to $1,450 a month. Not every line moved against staff: the top plan’s deductible fell from $3,000 to $2,000.

What $0 buys

Trustees approved a near-site clinic with Frontier Direct Care, promising no copays, deductibles or surprise bills “for primary and specialty services.” It’s funded by the district and open to employees and dependents on a district medical plan, with sites listed in Pflugerville and Austin. Staff keep a medical plan, and Frontier works alongside it.

The rate sheet says what’s inside, in capital letters and then in detail: “All Plans offer the FRONTIER CLINIC FREE OF CHARGE,” covering “Office Visits, Care Coordinated by Frontier, and Scripts Filled through Frontier.”

Read that against the table above. A specialist visit on the Low plan is an $80 copay, or $0 if Frontier coordinates it. A primary care visit is $35 to $50, or $0 at the clinic. Those copays give staff a reason to start at Frontier. Frontier’s employer pitch describes the same three levers: primary care, specialty referrals and prescriptions.

Frontier says it builds clinics “at no cost to you.” It also says, “We put 100% of our fees at risk against your total healthcare spend,” and “If we don’t bring it under trend, we refund every fee above the trend.” That’s a company’s marketing claim, and nothing DPC Insider reviewed shows those terms are in Pflugerville’s contract.

Why the HSA is the odd piece

The HSA left along with the plan it paired with. In 2026 the district’s HSA sat alongside a high deductible plan: $40 a month for one employee, a $6,000 deductible and office visits at 70% after the deductible. The 2027 Low plan keeps the $6,000 deductible, costs $50 and adds copays. The benefits guide’s plan table answers “Compatible with a Health Savings Account” with one word: “No.”

The enrollment page says staff can’t make new HSA elections or receive HSA contributions through the district for 2027. It gives no reason.

Here’s what can be checked from outside. IRS Notice 2026-5 protects HSA contributions for people in a direct primary care service arrangement, which has to consist solely of primary care services paid for by a fixed periodic fee, up to $150 a month or $300 for more than one person. It removes “prescription drugs other than vaccines” from primary care services by name.

Frontier’s package at Pflugerville includes prescriptions. On that published description, this publication reads the benefit as falling outside the definition on at least that one count, so it would get no help from the rule that lets DPC members keep contributing. That’s our reading, not a ruling, and the fee tests can’t be run without the fee, which DPC Insider couldn’t find.

If you run an independent practice and you’re pitching employers, that’s the part to notice. You might be selling a membership the federal rule was written for. This buyer, with a deficit to close, bought something wider.

The Open Question

What does Pflugerville pay Frontier? DPC Insider found no fee, contract term or guarantee in the district’s benefit pages or the board reports it reviewed. Last fall, while weighing proposals, the district described a potential return on investment within two to three years. The deficit it’s closing is a 2027 number.

Even a good year won’t settle it. The narrower network, the higher premiums and the clinic all start on the same day, so a smaller deficit in 2027 can’t show which one did the work. Staff will know what they pay. Unless the district publishes more, nobody outside will know what the DPC half of that bargain cost.