Provides for notice requirements where an insurer authorized to write accident and health insurance in this state, a corporation organized pursuant to article forty-three of this chapter, or a health maintenance organization certified pursuant to article forty-four of the public health law uses artificial intelligence-based algorithms in the utilization review process.
STATE OF NEW YORK
________________________________________________________________________
1456
2025-2026 Regular Sessions
IN ASSEMBLY
January 9, 2025
___________
Introduced by M. of A. HUNTER -- read once and referred to the Committee
on Insurance
AN ACT to amend the insurance law, in relation to the use of artificial
intelligence for utilization review
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. The insurance law is amended by adding a new section 338 to
2 read as follows:
3 § 338. Notification regarding the use of artificial intelligence for
4 utilization review. (a) As used in this section, the following terms
5 shall have the following meanings:
6 (1) "Adverse determination" shall have the same meaning as such term
7 is defined in section four thousand nine hundred of the public health
8 law.
9 (2) "Artificial intelligence-based algorithm" means any artificial
10 system that performs tasks under varying and unpredictable circumstances
11 without significant human oversight or that can learn from experience
12 and improve performance when exposed to data sets.
13 (3) "Clinical peer reviewer" shall have the same meaning as such term
14 is defined in section four thousand nine hundred of the public health
15 law.
16 (4) "Utilization review" shall have the same meaning as such term is
17 defined in section forty-nine hundred of the public health law.
18 (b) The superintendent shall require all insurers authorized to write
19 accident and health insurance in this state, corporations organized
20 pursuant to article forty-three of this chapter, and a health mainte-
21 nance organization certified pursuant to article forty-four of the
22 public health law to notify insureds and enrollees about the use or lack
23 of use of artificial intelligence-based algorithms in the utilization
24 review process on the accessible Internet website of such insurer
25 authorized to write accident and health insurance in this state, corpo-
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD01878-01-5
A. 1456 2
1 ration organized pursuant to article forty-three of this chapter, or
2 health maintenance organization certified pursuant to article forty-four
3 of the public health law.
4 (c) Every insurer authorized to write accident and health insurance in
5 this state, corporation organized pursuant to article forty-three of
6 this chapter, and health maintenance organization certified pursuant to
7 article forty-four of the public health law shall submit the artificial
8 intelligence-based algorithms and training data sets that are being used
9 or will be used in the utilization review process to the department. The
10 department shall implement a process that allows the department to
11 certify that these artificial intelligence-based algorithms and training
12 data sets have minimized the risk of bias based on the covered person's
13 race, color, religious creed, ancestry, age, sex, gender, national
14 origin, handicap or disability and adhere to evidence-based clinical
15 guidelines.
16 (d) A clinical peer reviewer who participates in a utilization review
17 process for an insurer authorized to write accident and health insurance
18 in this state, a corporation organized pursuant to article forty-three
19 of this chapter, and a health maintenance organization certified pursu-
20 ant to article forty-four of the public health law that initially uses
21 artificial intelligence-based algorithms for a utilization review shall
22 open and document the utilization review of the individual clinical
23 records or data prior to issuing an adverse determination.
24 (e) (1) A violation of the provisions of this section shall be subject
25 to one or more of the following penalties at the discretion of the
26 superintendent, in consultation with the commissioner of health and the
27 commissioner of education as applicable:
28 (i) Where a violation is made by an insurer authorized to write acci-
29 dent and health insurance in this state, a corporation organized pursu-
30 ant to article forty-three of this chapter, or a health maintenance
31 organization certified pursuant to article forty-four of the public
32 health law:
33 (A) Suspension or revocation of license;
34 (B) Refusal, for a period not to exceed one year, to issue a new
35 license;
36 (C) A fine of not more than $5,000 for each violation of this section;
37 or
38 (D) A fine of not more than $10,000 for each willful violation of this
39 section.
40 Fines imposed pursuant to the provisions of this subparagraph on a
41 single insurer authorized to write accident and health insurance in this
42 state, a corporation organized pursuant to article forty-three of this
43 chapter, or a health maintenance organization certified pursuant to
44 article forty-four of the public health law shall not exceed five
45 hundred thousand dollars in aggregate during a calendar year.
46 (ii) Where a violation is made by a clinical peer reviewer:
47 (A) Suspension or revocation of license;
48 (B) Refusal, for a period not to exceed one year, to issue a new
49 license;
50 (C) A fine of not more than $5,000 for each violation of this section;
51 or
52 (D) A fine of not more than $10,000 for each willful violation of this
53 section.
54 Fines imposed pursuant to the provisions of this subparagraph on a
55 single clinical peer reviewer shall not exceed one hundred thousand
56 dollars in aggregate during a calendar year.
A. 1456 3
1 (2) Penalties pursuant to the provisions of this subsection shall be
2 in addition to any other remedies or penalties that may be imposed under
3 any other applicable law.
4 (f) The superintendent shall promulgate all rules and regulations
5 necessary for the implementation of this section.
6 § 2. This act shall take effect on the sixtieth day after it shall
7 have become a law. Effective immediately, the addition, amendment and/or
8 repeal of any rule or regulation necessary for the implementation of
9 this act on its effective date are authorized to be made and completed
10 on or before such effective date.
