AN ACT to amend Tennessee Code Annotated, Title 8, Chapter 27; Title 56 and Title 71, relative to health insurance.
HB1866, titled the “Regulate Artificial Intelligence (AI) in Health Care Act,” would restrict how health insurance issuers in Tennessee use artificial intelligence, algorithms, or other software tools in utilization review and utilization management. The bill applies to entities regulated under Tennessee insurance law and expressly includes TennCare, CoverKids, Access Tennessee, certain state-managed plans, and group insurance plans. It defines artificial intelligence broadly and focuses on decisions tied to medical necessity and prior authorization.
Under the bill, a health insurance issuer could not deny, delay, or modify healthcare services based in whole or in part on medical necessity unless a licensed healthcare professional reviews the prior authorization request. The medical necessity determination must be made by a licensed physician or other qualified licensed healthcare professional who considers the requesting provider’s recommendation, the patient’s clinical history, and individual circumstances. The bill also authorizes the Department of Commerce and Insurance to adopt rules to implement the new requirements.
The bill would amend Tennessee Code Annotated Title 56 and related provisions to create a new insurance regulation governing AI-assisted utilization review. It would make violations an unfair claims practice subject to existing insurance penalties, and it would also create a private right of action allowing aggrieved individuals to seek actual damages, punitive damages, attorney fees, and court costs. The measure would affect health insurers, managed care entities, pharmacy benefits managers, third-party administrators, and state health coverage programs that use automated tools in coverage determinations.
The available record does not include committee transcripts or recorded votes, so there is no direct evidence of debate, support, or opposition in the provided materials. Based on the bill text, the measure appears designed to address concerns about automated denials and to ensure human clinical review in coverage decisions, suggesting a consumer- and patient-protection orientation. Because no voting history is provided, the overall legislative sentiment cannot be assessed from the supplied context.
The main point of contention is likely the bill’s restriction on AI and algorithmic tools in utilization review, especially for insurers and managed care organizations that rely on automated systems to process prior authorization requests. Supporters would likely emphasize patient safety, individualized medical judgment, and preventing inappropriate denials or delays in care. Opponents or affected stakeholders may object to increased administrative burden, potential delays from mandatory human review, expanded liability through the private cause of action, and limits on the use of technology to manage costs and utilization.