Senate Bill 63 Alabama 2026 Session

Summary

Primary Sponsor

Arthur OrrSenator

Republican

Session

2026 Regular Session

Title

Health care plans; to regulate the use of artificial intelligence in determinations of coverage

Summary

SB63 regulates how Alabama health insurers can use artificial intelligence to make coverage and prior-authorization decisions, with state oversight and penalties for violations.

What This Bill Does

If enacted, the bill requires insurers using AI for prior authorization to base decisions on the enrollee's medical history, the clinician's circumstances, and additional clinical information. It mandates annual certifications to the Department of Insurance showing the AI does not rely solely on group data, is applied fairly, and does not discriminate, and that AI outcomes are reviewed for accuracy and comply with HIPAA. It also requires that denials, reductions, or deferrals be made by a licensed physician or competent health care professional, and that AI use is clearly disclosed to enrollees or sponsors. The Department may investigate violations, require corrective actions, and impose disciplinary measures, with an effective date of October 1, 2026.

Who It Affects

• Enrollees and patients with health benefit plans would have AI-driven coverage decisions grounded in their medical history and clinical context, with required disclosures and clinician review.
• Insurers and health benefit plan issuers would must implement the rules, undergo annual compliance certifications, ensure fair and non-discriminatory use of AI, disclose AI involvement, and face Department enforcement for violations.

Key Provisions

• Defines artificial intelligence and related terms, and clarifies the act's scope applies to health benefit plans issued in Alabama (excluding certain limited benefit policies).
• Requires AI used for prior authorization determinations to consider the enrollee's medical history, clinical circumstances, and any additional clinical information available.
• Requires annual certification to the Department that the AI does not rely solely on group data, is configured and applied fairly across all enrollees, and does not discriminate in violation of law.
• Stipulates that denials, reductions, or deferrals based on AI must be made by a licensed physician or other competent health care professional who can evaluate the AI's recommendation in light of the patient’s specific situation.
• Requires prominent written disclosure when AI is used in utilization review, to either the plan sponsor (group plan) or the enrollee (individual plan).
• Requires annual certification that AI decisions are reviewed periodically to maximize accuracy and reliability and that its use complies with HIPAA.
• Authorizes the Department of Insurance to notify insurers of suspected violations, require responses within 30 days, and hold hearings if responses are unsatisfactory.
• Allows the Department to require corrective plans or impose disciplinary measures for repeat or serious violations, and directs the department to adopt enforcement rules.
• Effective date: October 1, 2026.

AI-generated summary using openai/gpt-5-nano on Feb 19, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Insurance