WHAT THIS BILL REGULATES · 3 REQUIREMENT TYPES
How Is This Bill Enforced
Verbatim statutory text on the left; plain-language analysis and a per-section checklist on the right. Numbered markers cross-link to the matching checklist row.
(E)(2) 1 A health insurance issuer shall include in its written or electronic notification of an adverse determination all of the reasons for the determination, including the clinical rationale, and the instructions for initiating an appeal or reconsideration of the determination, and whether artificial intelligenceArtificial intelligence"Artificial intelligence" as used in this Section means an engineered or machine-based system that varies in its level of autonomy, can receive input, and can, for explicit or implicit objectives, generate or infer how to generate outputs, including but not limited to predictions, simulations, and recommendations that can influence physical or virtual environments.R.S. 22:1260.49(A)(1) or an automated decision systemAutomated decision system"Automated decision system" as used in this Section means any computational process derived from machine learning, statistical modeling, data analytics, or artificial intelligence that issues simplified output, including but not limited to a score, classification, or recommendation, that is used to assist or replace human discretionary decision making and materially impacts a natural person.R.S. 22:1260.49(A)(2), as defined in R.S. 22:1260.49, was used in the determination process.
This section amends existing adverse determination notice requirements to add a new disclosure obligation: health insurance issuers must now inform insureds in their written or electronic adverse determination notices whether artificial intelligence or an automated decision system was used in the determination process. This is a targeted amendment to existing utilization review notification rules.
(A)(1) "Artificial intelligenceArtificial intelligence"Artificial intelligence" as used in this Section means an engineered or machine-based system that varies in its level of autonomy, can receive input, and can, for explicit or implicit objectives, generate or infer how to generate outputs, including but not limited to predictions, simulations, and recommendations that can influence physical or virtual environments.R.S. 22:1260.49(A)(1)" as used in this Section means an engineered or machine-based system that varies in its level of autonomy, can receive input, and can, for explicit or implicit objectives, generate or infer how to generate outputs, including but not limited to predictions, simulations, and recommendations that can influence physical or virtual environments.
(A)(2) "Automated decision systemAutomated decision system"Automated decision system" as used in this Section means any computational process derived from machine learning, statistical modeling, data analytics, or artificial intelligence that issues simplified output, including but not limited to a score, classification, or recommendation, that is used to assist or replace human discretionary decision making and materially impacts a natural person.R.S. 22:1260.49(A)(2)" as used in this Section means any computational process derived from machine learning, statistical modeling, data analytics, or artificial intelligenceArtificial intelligence"Artificial intelligence" as used in this Section means an engineered or machine-based system that varies in its level of autonomy, can receive input, and can, for explicit or implicit objectives, generate or infer how to generate outputs, including but not limited to predictions, simulations, and recommendations that can influence physical or virtual environments.R.S. 22:1260.49(A)(1) that issues simplified output, including but not limited to a score, classification, or recommendation, that is used to assist or replace human discretionary decision making and materially impacts a natural person.
Subsection A provides the two core definitions for the new section: artificial intelligence and automated decision system. The AI definition tracks NIST-style language emphasizing autonomy, input-output capability, and influence on environments. The automated decision system definition focuses on computational processes that issue simplified outputs used to assist or replace human discretionary decision making.
(B) The provisions of this Section are applicable to insurers, pharmacy benefit managers, or an independent review agent or organization that does either of the following: (1) Uses artificial intelligenceArtificial intelligence"Artificial intelligence" as used in this Section means an engineered or machine-based system that varies in its level of autonomy, can receive input, and can, for explicit or implicit objectives, generate or infer how to generate outputs, including but not limited to predictions, simulations, and recommendations that can influence physical or virtual environments.R.S. 22:1260.49(A)(1) or an automated decision systemAutomated decision system"Automated decision system" as used in this Section means any computational process derived from machine learning, statistical modeling, data analytics, or artificial intelligence that issues simplified output, including but not limited to a score, classification, or recommendation, that is used to assist or replace human discretionary decision making and materially impacts a natural person.R.S. 22:1260.49(A)(2) for utilization review. (2) Contracts with a carrier that uses artificial intelligenceArtificial intelligence"Artificial intelligence" as used in this Section means an engineered or machine-based system that varies in its level of autonomy, can receive input, and can, for explicit or implicit objectives, generate or infer how to generate outputs, including but not limited to predictions, simulations, and recommendations that can influence physical or virtual environments.R.S. 22:1260.49(A)(1) or an automated decision systemAutomated decision system"Automated decision system" as used in this Section means any computational process derived from machine learning, statistical modeling, data analytics, or artificial intelligence that issues simplified output, including but not limited to a score, classification, or recommendation, that is used to assist or replace human discretionary decision making and materially impacts a natural person.R.S. 22:1260.49(A)(2) for the purpose of utilization review.
Subsection B defines the scope of entities subject to the new section: insurers, pharmacy benefit managers, and independent review agents or organizations that either directly use AI or automated decision systems for utilization review or contract with a carrier that does so. The bill does not create a single defined-term covered entity but instead describes coverage functionally.
(C)(1) 2 No entity subject to this Section shall utilize an artificial intelligenceArtificial intelligence"Artificial intelligence" as used in this Section means an engineered or machine-based system that varies in its level of autonomy, can receive input, and can, for explicit or implicit objectives, generate or infer how to generate outputs, including but not limited to predictions, simulations, and recommendations that can influence physical or virtual environments.R.S. 22:1260.49(A)(1) or an automated decision systemAutomated decision system"Automated decision system" as used in this Section means any computational process derived from machine learning, statistical modeling, data analytics, or artificial intelligence that issues simplified output, including but not limited to a score, classification, or recommendation, that is used to assist or replace human discretionary decision making and materially impacts a natural person.R.S. 22:1260.49(A)(2) that does any of the following: (a) Engages in discrimination that is prohibited by federal or state law. (b) Violates regulations or guidance disseminated by the United States Department of Health and Human Services. (c) Delays, denies, or modifies healthcare services.
(C)(2)–(3) 3 Artificial intelligenceArtificial intelligence"Artificial intelligence" as used in this Section means an engineered or machine-based system that varies in its level of autonomy, can receive input, and can, for explicit or implicit objectives, generate or infer how to generate outputs, including but not limited to predictions, simulations, and recommendations that can influence physical or virtual environments.R.S. 22:1260.49(A)(1) or an automated decision systemAutomated decision system"Automated decision system" as used in this Section means any computational process derived from machine learning, statistical modeling, data analytics, or artificial intelligence that issues simplified output, including but not limited to a score, classification, or recommendation, that is used to assist or replace human discretionary decision making and materially impacts a natural person.R.S. 22:1260.49(A)(2) used in the determination process shall not base its determination or determination recommendation solely on a group data set. (3) Artificial intelligenceArtificial intelligence"Artificial intelligence" as used in this Section means an engineered or machine-based system that varies in its level of autonomy, can receive input, and can, for explicit or implicit objectives, generate or infer how to generate outputs, including but not limited to predictions, simulations, and recommendations that can influence physical or virtual environments.R.S. 22:1260.49(A)(1) or an automated decision systemAutomated decision system"Automated decision system" as used in this Section means any computational process derived from machine learning, statistical modeling, data analytics, or artificial intelligence that issues simplified output, including but not limited to a score, classification, or recommendation, that is used to assist or replace human discretionary decision making and materially impacts a natural person.R.S. 22:1260.49(A)(2) shall base its determination or determination recommendation on any the following: (a) The insured's medical or other clinical history. (b) Individual clinical circumstances as presented by a requesting provider. (c) Other relevant clinical information contained in the insured's medical or other clinical history.
Subsection C establishes two interrelated sets of requirements. First, it categorically prohibits covered entities from using AI or automated decision systems that engage in discrimination, violate HHS regulations or guidance, or delay, deny, or modify healthcare services. Second, it requires that AI tools base determinations on individualized clinical data — the insured's medical history, the requesting provider's clinical presentation, and other relevant clinical information — rather than solely on group-level datasets. Together, these provisions ensure AI serves as a clinical support tool constrained by individual patient circumstances rather than an autonomous denial engine.
(D)(1)(a)–(b) 4 An entity subject to this Section shall not replace the role of a healthcare provider in the determination process with artificial intelligenceArtificial intelligence"Artificial intelligence" as used in this Section means an engineered or machine-based system that varies in its level of autonomy, can receive input, and can, for explicit or implicit objectives, generate or infer how to generate outputs, including but not limited to predictions, simulations, and recommendations that can influence physical or virtual environments.R.S. 22:1260.49(A)(1) or an automated decision systemAutomated decision system"Automated decision system" as used in this Section means any computational process derived from machine learning, statistical modeling, data analytics, or artificial intelligence that issues simplified output, including but not limited to a score, classification, or recommendation, that is used to assist or replace human discretionary decision making and materially impacts a natural person.R.S. 22:1260.49(A)(2). (b) Any adverse determination shall be signed by a licensed physician who personally reviewed the medical record and is responsible for the clinical judgment.
(D)(2)(a) 5 Require independent judgment from human utilization review personnel in the utilization review process before making an adverse determination for either of the following: (i) Any claim submitted by a provider based on medical necessity. (ii) Any claim submitted by a provider for a procedure requiring prior authorization.
(D)(2)(b) 6 Comply with applicable regulations and guidance for artificial intelligenceArtificial intelligence"Artificial intelligence" as used in this Section means an engineered or machine-based system that varies in its level of autonomy, can receive input, and can, for explicit or implicit objectives, generate or infer how to generate outputs, including but not limited to predictions, simulations, and recommendations that can influence physical or virtual environments.R.S. 22:1260.49(A)(1) or automated decision systemAutomated decision system"Automated decision system" as used in this Section means any computational process derived from machine learning, statistical modeling, data analytics, or artificial intelligence that issues simplified output, including but not limited to a score, classification, or recommendation, that is used to assist or replace human discretionary decision making and materially impacts a natural person.R.S. 22:1260.49(A)(2) use issued by the United States Department of Health and Human Services.
(D)(2)(c) 7 Review the performance, use, and outcomes of an artificial intelligenceArtificial intelligence"Artificial intelligence" as used in this Section means an engineered or machine-based system that varies in its level of autonomy, can receive input, and can, for explicit or implicit objectives, generate or infer how to generate outputs, including but not limited to predictions, simulations, and recommendations that can influence physical or virtual environments.R.S. 22:1260.49(A)(1) or an automated decision systemAutomated decision system"Automated decision system" as used in this Section means any computational process derived from machine learning, statistical modeling, data analytics, or artificial intelligence that issues simplified output, including but not limited to a score, classification, or recommendation, that is used to assist or replace human discretionary decision making and materially impacts a natural person.R.S. 22:1260.49(A)(2) at a minimum of once per quarter, and revise the policies and procedures as needed to ensure compliance with this Section.
(D)(2)(d) 8 Use patient data within its intended and stated purpose consistent with the federal Health Insurance Portability and Accountability Act of 1996, as applicable.
Subsection D is the operational heart of the bill. It imposes four distinct obligations: (1) AI may not replace the role of a healthcare provider in the determination process, and every adverse determination must be signed by a licensed physician who personally reviewed the medical record; (2) human utilization review personnel must exercise independent judgment before any adverse determination on medical necessity or prior authorization claims; (3) covered entities must review AI system performance, use, and outcomes at least quarterly and revise policies as needed; and (4) patient data must be used within its intended purpose consistent with HIPAA.
(D)(3)(a) 9 A health insurance issuer shall disclose to the enrollee and the department when artificial intelligenceArtificial intelligence"Artificial intelligence" as used in this Section means an engineered or machine-based system that varies in its level of autonomy, can receive input, and can, for explicit or implicit objectives, generate or infer how to generate outputs, including but not limited to predictions, simulations, and recommendations that can influence physical or virtual environments.R.S. 22:1260.49(A)(1) or an automated decision systemAutomated decision system"Automated decision system" as used in this Section means any computational process derived from machine learning, statistical modeling, data analytics, or artificial intelligence that issues simplified output, including but not limited to a score, classification, or recommendation, that is used to assist or replace human discretionary decision making and materially impacts a natural person.R.S. 22:1260.49(A)(2) was used in any part of a coverage determination or utilization review.
(D)(3)(b) 10 The health insurance issuer shall document the extent to which any artificial intelligenceArtificial intelligence"Artificial intelligence" as used in this Section means an engineered or machine-based system that varies in its level of autonomy, can receive input, and can, for explicit or implicit objectives, generate or infer how to generate outputs, including but not limited to predictions, simulations, and recommendations that can influence physical or virtual environments.R.S. 22:1260.49(A)(1) or automated decision systemAutomated decision system"Automated decision system" as used in this Section means any computational process derived from machine learning, statistical modeling, data analytics, or artificial intelligence that issues simplified output, including but not limited to a score, classification, or recommendation, that is used to assist or replace human discretionary decision making and materially impacts a natural person.R.S. 22:1260.49(A)(2) influenced the determination.
Subsection D(3) creates a dual disclosure obligation. Health insurance issuers must disclose to both the enrollee and the Department of Insurance when AI or an automated decision system was used in any part of a coverage determination or utilization review. Separately, the issuer must document the extent to which any AI or automated decision system influenced the determination. The documentation requirement supports both regulatory oversight and the enrollee's ability to challenge AI-influenced decisions on appeal.
(E)(1) 11 Any insured has the right to appeal a determination that he has learned was made with a recommendation from an artificial intelligenceArtificial intelligence"Artificial intelligence" as used in this Section means an engineered or machine-based system that varies in its level of autonomy, can receive input, and can, for explicit or implicit objectives, generate or infer how to generate outputs, including but not limited to predictions, simulations, and recommendations that can influence physical or virtual environments.R.S. 22:1260.49(A)(1) or an automated decision systemAutomated decision system"Automated decision system" as used in this Section means any computational process derived from machine learning, statistical modeling, data analytics, or artificial intelligence that issues simplified output, including but not limited to a score, classification, or recommendation, that is used to assist or replace human discretionary decision making and materially impacts a natural person.R.S. 22:1260.49(A)(2).
(E)(2) 12 Any adverse determination in which artificial intelligenceArtificial intelligence"Artificial intelligence" as used in this Section means an engineered or machine-based system that varies in its level of autonomy, can receive input, and can, for explicit or implicit objectives, generate or infer how to generate outputs, including but not limited to predictions, simulations, and recommendations that can influence physical or virtual environments.R.S. 22:1260.49(A)(1) or an automated decision systemAutomated decision system"Automated decision system" as used in this Section means any computational process derived from machine learning, statistical modeling, data analytics, or artificial intelligence that issues simplified output, including but not limited to a score, classification, or recommendation, that is used to assist or replace human discretionary decision making and materially impacts a natural person.R.S. 22:1260.49(A)(2) materially contributed to the determination shall be presumed invalid unless the health insurance issuer demonstrates that the determination was independently reached through documented clinical judgment without reliance upon algorithmic output.
(E)(3) 13 If an adverse determination is appealed on the basis of the use of an artificial intelligenceArtificial intelligence"Artificial intelligence" as used in this Section means an engineered or machine-based system that varies in its level of autonomy, can receive input, and can, for explicit or implicit objectives, generate or infer how to generate outputs, including but not limited to predictions, simulations, and recommendations that can influence physical or virtual environments.R.S. 22:1260.49(A)(1) or an automated decision systemAutomated decision system"Automated decision system" as used in this Section means any computational process derived from machine learning, statistical modeling, data analytics, or artificial intelligence that issues simplified output, including but not limited to a score, classification, or recommendation, that is used to assist or replace human discretionary decision making and materially impacts a natural person.R.S. 22:1260.49(A)(2), the insurer shall not use an artificial intelligenceArtificial intelligence"Artificial intelligence" as used in this Section means an engineered or machine-based system that varies in its level of autonomy, can receive input, and can, for explicit or implicit objectives, generate or infer how to generate outputs, including but not limited to predictions, simulations, and recommendations that can influence physical or virtual environments.R.S. 22:1260.49(A)(1) or an automated decision systemAutomated decision system"Automated decision system" as used in this Section means any computational process derived from machine learning, statistical modeling, data analytics, or artificial intelligence that issues simplified output, including but not limited to a score, classification, or recommendation, that is used to assist or replace human discretionary decision making and materially impacts a natural person.R.S. 22:1260.49(A)(2) in any subsequent review of the claim.
Subsection E creates a distinctive three-part appeal framework for AI-influenced determinations. First, any insured has the right to appeal a determination that was made with an AI recommendation. Second, any adverse determination in which AI materially contributed is presumed invalid unless the insurer proves independent clinical judgment without reliance on algorithmic output — shifting the burden of proof to the insurer. Third, when an adverse determination is appealed on AI-use grounds, the insurer is prohibited from using AI in any subsequent review of that claim. This presumption-of-invalidity provision is unusually strong compared to other state healthcare AI bills.
(F)(1) 14 An entity subject to this Section shall allow the commissioner to inspect and audit the artificial intelligenceArtificial intelligence"Artificial intelligence" as used in this Section means an engineered or machine-based system that varies in its level of autonomy, can receive input, and can, for explicit or implicit objectives, generate or infer how to generate outputs, including but not limited to predictions, simulations, and recommendations that can influence physical or virtual environments.R.S. 22:1260.49(A)(1) or automated decision systemAutomated decision system"Automated decision system" as used in this Section means any computational process derived from machine learning, statistical modeling, data analytics, or artificial intelligence that issues simplified output, including but not limited to a score, classification, or recommendation, that is used to assist or replace human discretionary decision making and materially impacts a natural person.R.S. 22:1260.49(A)(2) for compliance with this Section and review policies and procedures for how the artificial intelligenceArtificial intelligence"Artificial intelligence" as used in this Section means an engineered or machine-based system that varies in its level of autonomy, can receive input, and can, for explicit or implicit objectives, generate or infer how to generate outputs, including but not limited to predictions, simulations, and recommendations that can influence physical or virtual environments.R.S. 22:1260.49(A)(1) or automated decision systemAutomated decision system"Automated decision system" as used in this Section means any computational process derived from machine learning, statistical modeling, data analytics, or artificial intelligence that issues simplified output, including but not limited to a score, classification, or recommendation, that is used to assist or replace human discretionary decision making and materially impacts a natural person.R.S. 22:1260.49(A)(2) is used in the determination process.
(F)(2) 14 The commissioner may require submission and independent review of any artificial intelligenceArtificial intelligence"Artificial intelligence" as used in this Section means an engineered or machine-based system that varies in its level of autonomy, can receive input, and can, for explicit or implicit objectives, generate or infer how to generate outputs, including but not limited to predictions, simulations, and recommendations that can influence physical or virtual environments.R.S. 22:1260.49(A)(1) or automated decision systemAutomated decision system"Automated decision system" as used in this Section means any computational process derived from machine learning, statistical modeling, data analytics, or artificial intelligence that issues simplified output, including but not limited to a score, classification, or recommendation, that is used to assist or replace human discretionary decision making and materially impacts a natural person.R.S. 22:1260.49(A)(2) used in utilization review.
(F)(3) 15 Upon request of the commissioner, a health insurance issuer shall disclose the data sources, training parameters, and validation methods used to develop any artificial intelligenceArtificial intelligence"Artificial intelligence" as used in this Section means an engineered or machine-based system that varies in its level of autonomy, can receive input, and can, for explicit or implicit objectives, generate or infer how to generate outputs, including but not limited to predictions, simulations, and recommendations that can influence physical or virtual environments.R.S. 22:1260.49(A)(1) or automated decision systemAutomated decision system"Automated decision system" as used in this Section means any computational process derived from machine learning, statistical modeling, data analytics, or artificial intelligence that issues simplified output, including but not limited to a score, classification, or recommendation, that is used to assist or replace human discretionary decision making and materially impacts a natural person.R.S. 22:1260.49(A)(2) used in coverage determinations.
(F)(4) 14 The health insurance issuer shall pay for any independent review that the commissioner deems necessary.
Subsection F grants the Louisiana Commissioner of Insurance broad regulatory authority over AI systems used in utilization review. Covered entities must allow commissioner inspection and audit of AI systems and associated policies. The commissioner may require submission and independent review of any AI system used in utilization review. Upon request, issuers must disclose data sources, training parameters, and validation methods. The insurer bears the cost of any independent review the commissioner deems necessary.
(4) 16 Allow covered persons, upon request, to review and have copies of all documents relevant to any artificial intelligenceArtificial intelligence"Artificial intelligence" as used in this Section means an engineered or machine-based system that varies in its level of autonomy, can receive input, and can, for explicit or implicit objectives, generate or infer how to generate outputs, including but not limited to predictions, simulations, and recommendations that can influence physical or virtual environments.R.S. 22:1260.49(A)(1) or an automated decision systemAutomated decision system"Automated decision system" as used in this Section means any computational process derived from machine learning, statistical modeling, data analytics, or artificial intelligence that issues simplified output, including but not limited to a score, classification, or recommendation, that is used to assist or replace human discretionary decision making and materially impacts a natural person.R.S. 22:1260.49(A)(2) as defined in R.S. 22:1260.49(A)(1) used in the utilization review or determination process.
This provision amends the existing appeals process minimum requirements to add a new right for covered persons to review and obtain copies of all documents relevant to any AI or automated decision system used in the utilization review or determination process. This ensures transparency in the appeals context by giving insureds access to the AI-related documentation that the insurer is required to maintain under R.S. 22:1260.49(D)(3)(b).