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S2010AHealth Insurance

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

This bill requires health insurers to report their AI use and mandates human review before AI can deny medical claims.

Introduced38 Yea0 Nay0 Not voting
Population
Affected
72
Email Legislator
Introduced Jan 9, 2026Committee Senate Artificial Intelligence & Emerging Tech

Plain-English Summary

This bill regulates how health insurance companies use Artificial Intelligence (AI) to manage and deny medical claims. It requires insurers to report their AI use, including data on models, denial rates, and time spent reviewing claims, to state regulators. Most importantly, if an AI system recommends denying a medical claim based on medical necessity, a human medical professional with the same credentials as the prescribing doctor must review and approve the denial before it becomes final. Insurers must keep records of these AI decisions for five years and cover the costs of complying with these new rules.

For younger readers

Sometimes, health insurance companies use computers and Artificial Intelligence, or AI, to decide if they will pay for a person's doctor visit or medicine. This bill makes a rule that a computer cannot say "no" to paying for a patient's medical care all by itself. A real human doctor must look at the computer's answer and agree with it before the insurance company can refuse to pay. The bill also makes the insurance companies tell the government exactly how they are using these computer programs.

Who & Where It Applies

Impacted groups
Health insurance companiesMedical providersInsured patientsState health regulatorsArtificial intelligence software developers
Impacted communities
All

Constitutional & Fiscal Check

The requirement for insurers to submit "all information, including documents and software" upon request could raise minor Fourth Amendment (unreasonable searches) or Fifth Amendment (takings clause regarding proprietary trade secrets) concerns. However, because insurance is a heavily regulated industry with lower expectations of privacy, the constitutional risk is generally low, provided requests are reasonably tailored by regulators.

Estimated cost
None
Estimated revenue
None

Bill Analysis

Both viewpoints
For Progressives
  • Protects patients from arbitrary, algorithm-driven denials of healthcare by mandating human oversight from qualified medical professionals.
  • Increases corporate transparency by forcing health insurance companies to disclose exactly how they use AI and the data they train it on, helping expose potential biases.
  • Empowers state regulators to monitor AI denial rates and hold massive health insurance corporations accountable for their decision-making processes.
  • Does not outright ban the use of AI in making medical coverage decisions, allowing insurance companies to still rely heavily on algorithms to cut costs.
  • Fails to establish direct financial penalties or fines for insurance companies that violate the reporting or review requirements, potentially weakening enforcement.
  • Only requires the human reviewer to have the "same license status" as the ordering provider, which might not guarantee they have the same specialized medical expertise.
For Conservatives
  • Protects the integrity of the medical profession by ensuring that complex medical decisions are made by licensed human providers rather than automated computer algorithms.
  • Promotes transparency by requiring clear reporting on how AI is used, ensuring that automated systems are not unfairly rejecting valid claims.
  • Places the financial cost of compliance directly on the insurers themselves, ensuring that taxpayers do not foot the bill for this new regulatory framework.
  • Imposes significant new regulatory reporting requirements on private health insurance businesses, which restricts corporate freedom and increases operational costs.
  • Mandates that insurers bear all costs of compliance, which will likely be passed down to consumers in the form of higher insurance premiums.
  • Requires insurers to surrender proprietary software and algorithmic data to government regulators upon request, potentially threatening corporate intellectual property and trade secrets.

Votes

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Full Bill Text

2 versions
Changes to existing Rhode Island law · 99 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, 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, a healthcare entity as defined in 27-18.9-2, or any other entity providing a plan of health insurance, accident and sickness insurance, health benefits, or healthcare services. Insurer includes any agent or contracted entity acting on behalf of the insurer in the administration, review, or determination of healthcare claims or coverage.

(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 render the non-administrative adverse benefit determination invalid and require reconsideration in compliance with this subsection.

(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.