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H 7190Health Insurance

Insurance - The Transparency and Accountability in Artificial Intelligence Use by Health Insurers to Manage Coverage and Claims Act

Regulates health insurers' use of AI, mandating transparency and requiring human review for medical necessity claim denials.

Held for study
Population
Affected
45
Email Legislator
Introduced Jan 21, 2026Committee House Health & Human Services

Plain-English Summary

This legislation, known as "The Transparency and Accountability in Artificial Intelligence Use by Health Insurers to Manage Coverage and Claims Act," creates new regulations for health insurance companies in Rhode Island. It requires insurers to disclose to state regulators how they use Artificial Intelligence (AI) to make decisions about patient coverage and claims. Most importantly, the bill mandates that if an AI system is used to deny a claim based on medical necessity, a qualified human healthcare provider must review and approve that decision. If this human review does not happen, the denial is automatically overturned.

For younger readers

This law is about making sure computers don't make mistakes with people's doctor bills. Sometimes, insurance companies use smart computer programs (Artificial Intelligence) to decide if they will pay for a sick person's medicine or surgery. This law says the companies have to tell the government how these computers work. Also, if the computer says "no" to paying for something a doctor ordered, a real human doctor has to look at it and agree before the answer is officially "no." This helps make sure people get the care they need and aren't ignored by a machine.

Who & Where It Applies

Impacted groups
Health InsurersPatients/EnrolleesMedical ProvidersOffice of the Health Insurance CommissionerDepartment of Business Regulation
Impacted communities
All

Constitutional & Fiscal Check

None Likely

Estimated cost
None
Estimated revenue
None

Bill Analysis

Both viewpoints
For Progressives
  • Protects vulnerable patients from automated, profit-driven denials of care by mandating that a human provider review any adverse decision made by an algorithm, ensuring medical necessity is prioritized over efficiency.
  • Increases corporate accountability and transparency by forcing insurance giants to disclose their AI models, training datasets, and denial metrics to state regulators, helping to identify and prevent algorithmic bias.
  • Empowers the medical community and patients by establishing that failure to provide a human review results in an automatic reversal of the denial, creating a strong check against systemic corporate negligence.
  • Does not outright ban the use of AI in denying healthcare claims, potentially allowing corporations to continue using algorithms to filter claims as long as they perform a perfunctory human review.
  • Relies heavily on state agencies (OHIC and DBR) for oversight and reporting, which may lack the resources or political will to aggressively enforce these regulations against powerful insurance lobbies.
  • Allowing insurers to pass the costs of compliance onto the business structure means these costs may ultimately fall on working-class policyholders through higher premiums, rather than cutting into executive profits.
For Conservatives
  • Protects the traditional doctor-patient relationship by ensuring that medical decisions are reviewed by licensed professionals rather than being determined solely by unaccountable machines.
  • Ensures contract integrity by preventing insurance companies from using opaque software to arbitrarily deny coverage that consumers have paid for, holding companies to their promises.
  • Provides a clear mechanism for accountability, ensuring that individuals are not subjected to "faceless" bureaucratic or automated decisions without recourse.
  • Imposes significant new regulatory burdens and reporting requirements on private businesses, interfering with corporate freedom and operational efficiency.
  • Expands the size and scope of government by giving state agencies (OHIC and DBR) more authority to investigate and monitor the internal proprietary technologies of private companies.
  • Mandates that insurers bear the total cost of compliance, which essentially functions as a hidden tax on business operations and will likely result in higher costs for consumers.

Votes

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Full Bill Text

Changes to existing Rhode Island law · 97 additions

SECTION 1. Title 27 of the General Laws entitled "INSURANCE" is hereby amended by adding thereto the following chapter: 27-84-1. Short title and purpose.

(a) This chapter shall be known and may be cited as "The Transparency and Accountability in Artificial Intelligence Use by Health Insurers to Manage Coverage and Claims Act."

(b) The purpose of this chapter is to regulate the use of artificial intelligence ("AI") by health insurers to ensure transparency, accountability and compliance with state and federal requirements for non-administrative claims and coverage management. 27-84-2. Definitions. As used in this chapter, the following terms shall have the following meanings, unless the context clearly indicates otherwise:

(1) "Adverse benefit determination" means a decision not to authorize coverage for a healthcare service, including a denial, reduction, or termination of, or a failure to provide or make a payment, in whole or in part, for a benefit. A decision by a utilization-review agent to authorize a healthcare service in an alternative setting, a modified extension of stay, or an alternative treatment shall not constitute an adverse benefit determination if the review agent and ordering provider are in agreement regarding the decision. "Adverse benefit determination" includes:

(i) "Administrative adverse benefit determination," meaning any adverse benefit determination that does not require the use of medical judgment or clinical criteria such as a determination of an individual's eligibility to participate in coverage, a determination that a benefit is not a covered benefit, or any rescission of coverage; and

(ii) "Non-administrative adverse benefit determination," meaning any adverse benefit determination that requires or involves the use of medical judgement or clinical criteria to determine whether the service being reviewed is medically necessary and/or appropriate. This determination includes the denial of treatments determined to be experimental or investigational, and any denial of coverage of a prescription drug due to the fact that the drug is not on the insurer's formulary.

(2) "Artificial intelligence" means a machine-based system that can, for a given set of human-defined objectives, make predictions, recommendations or decisions influencing real or virtual environments. Artificial intelligence systems use machine and human-based inputs to:

(i) Perceive real and virtual environments;

(ii) Abstract such perceptions into models through analysis in an automated manner; and

(iii) Use model inference to formulate options for information or action.

(3) "Enrollee" means an individual who has health insurance coverage through an insurer.

(4) "Insurer" means an insurance company licensed, or required to be licensed, by the State of Rhode Island or other entity subject to the jurisdiction of the commissioner or the jurisdiction of the department of business regulation pursuant to chapter 62 of title 42, that contracts or offers to contract, or enters into an agreement to provide, deliver, arrange for, pay for, or reimburse any of the costs of healthcare services, including, without limitation: a for-profit or nonprofit hospital, medical or dental service corporation or plan, a health maintenance organization, a health insurance company, or any other entity providing a plan of health insurance, accident and sickness insurance, health benefits, or healthcare services including, but not limited to, pharmacy benefit managers.

(5) "Medically necessary care" means a medical, surgical, or other service required for the prevention, diagnosis, cure, or treatment of a health-related condition including any such services that are necessary to prevent or slow a decremental change in either medical or mental health status.

(6) "Provider" means a physician, hospital, professional provider, pharmacy, laboratory, dental, medical, or behavioral health provider or other state-licensed or other state-recognized provider of health care or behavioral health services or supplies. 27-84-3. Requirements.

(a) Transparency.

(1) Insurers subject to this chapter shall disclose to the office of the health insurance commissioner ("OHIC") and the department of business regulation ("DBR") how they use artificial intelligence to manage healthcare claims and coverage including, but not limited to, the types of artificial intelligence models used, the role of artificial intelligence in the decision-making process, training datasets, performance metrics, governance and risk management policies, and the decisions on healthcare claims and coverage where artificial intelligence made, or was a substantial factor in making, the decisions.

(2) Insurers shall submit to the office of the health insurance commissioner and the department of business regulation, upon request, all information, including documents and software, that permits enforcement of this chapter.

(3) Insurers shall maintain documentation of artificial intelligence decisions for at least five

(5) years including adverse benefit determinations where artificial intelligence made, or was a substantial factor in making, the adverse benefit determination.

(b) DBR/OHIC reporting.

(1) DBR/OHIC shall provide an initial report to the governor, the senate president and the speaker of the house on the use of artificial intelligence by health insurers within eighteen (18) months of the effective date of this chapter and annually thereafter.

(2) The annual report shall state how health insurers use artificial intelligence to manage claims and coverage. The report shall state, for each insurer:

(i) The types of artificial intelligence models used;

(ii) The role of artificial intelligence in the decision-making process to approve or deny healthcare claims or coverage whenever artificial intelligence is used to make, or is a substantial factor in making, a decision on healthcare claims or coverage;

(iii) Information regarding training. testing, and risk management including data governance measures used to cover the training data sets and the measures used to examine the suitability of data sources, possible biases and appropriate mitigation; and

(iv) Performance metrics including: number of claims; percentage of claims accepted and denied; the average time claim reviewers and medical professional reviewers spend on each claim and on denials of claims; percentage of claims appealed; and percentage of denials reversed. 27-84-4. Non-administrative adverse benefit determination review.

(a) Any non-administrative adverse benefit determination where an artificial intelligence system made, or was a substantial factor in making, that determination regarding medically necessary care shall be reviewed and approved by a provider with the same license status of the ordering professional provider before being finalized, with documentation of their rationale included in the enrollee’s case record. Failure to follow the requirements set forth in this subsection shall result in reversal of the non-administrative adverse determination.

(b) Appeals of non-administrative adverse benefit determinations made by an artificial intelligence system regarding medically necessary care that has been reviewed and approved by a provider with the same license status of the ordering professional provider shall comply with the appeals process set forth in chapter 18.9 of title 27. 27-84-5. Enforcement.

(a) OHIC, in collaboration with DBR, shall promulgate rules and regulations that may be necessary to effectuate the purposes and implementation of this chapter.

(b) The total cost of complying with the requirements of this chapter and the applicable rules and regulations shall be borne by the insurer. 27-84-6. Severability. If any provision of this chapter is found unconstitutional, preempted, or otherwise invalid, that provision shall be severed, and such decision shall not affect the validity of the remaining provisions of this chapter.

SECTION 2. This act shall take effect upon passage.