WHAT THIS BILL REGULATES · 2 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.
(a)(1)–(3) In this section the following words have the meanings indicated. (2) "Artificial intelligenceArtificial intelligence"Artificial intelligence" means an engineered or machine–based system that varies in its level of autonomy and that can, for explicit or implicit objectives, infer from the input it receives how to generate outputs that can influence physical or virtual environments.Md. Code Ann., Insurance § 15–10B–05.1(a)(2)" means an engineered or machine–based system that varies in its level of autonomy and that can, for explicit or implicit objectives, infer from the input it receives how to generate outputs that can influence physical or virtual environments. (3) "CarrierCarrier"Carrier" means: (i) an insurer; (ii) a nonprofit health service plan; (iii) a health maintenance organization; (iv) a dental plan organization; or (v) any other person that provides health benefit plans subject to regulation by the State.Md. Code Ann., Insurance § 15–10B–05.1(a)(3)" means: (i) an insurer; (ii) a nonprofit health service plan; (iii) a health maintenance organization; (iv) a dental plan organization; or (v) any other person that provides health benefit plans subject to regulation by the State.
Subsection (a) defines the key terms used throughout the section. "Artificial intelligence" tracks the NIST-influenced definition covering engineered or machine-based systems that generate outputs from inputs. "Carrier" is broadly defined to include insurers, nonprofit health service plans, HMOs, dental plan organizations, and any other person providing health benefit plans subject to state regulation.
(b)(1)–(2) This section applies to: (1) a carrierCarrier"Carrier" means: (i) an insurer; (ii) a nonprofit health service plan; (iii) a health maintenance organization; (iv) a dental plan organization; or (v) any other person that provides health benefit plans subject to regulation by the State.Md. Code Ann., Insurance § 15–10B–05.1(a)(3) that: (i) uses an artificial intelligenceArtificial intelligence"Artificial intelligence" means an engineered or machine–based system that varies in its level of autonomy and that can, for explicit or implicit objectives, infer from the input it receives how to generate outputs that can influence physical or virtual environments.Md. Code Ann., Insurance § 15–10B–05.1(a)(2), algorithm, or other software tool for the purpose of utilization review; or (ii) contracts with or otherwise works through an entity that uses an artificial intelligenceArtificial intelligence"Artificial intelligence" means an engineered or machine–based system that varies in its level of autonomy and that can, for explicit or implicit objectives, infer from the input it receives how to generate outputs that can influence physical or virtual environments.Md. Code Ann., Insurance § 15–10B–05.1(a)(2), algorithm, or other software tool for the purpose of utilization review; and (2) a pharmacy benefits manager or private review agent that: (i) contracts with a carrierCarrier"Carrier" means: (i) an insurer; (ii) a nonprofit health service plan; (iii) a health maintenance organization; (iv) a dental plan organization; or (v) any other person that provides health benefit plans subject to regulation by the State.Md. Code Ann., Insurance § 15–10B–05.1(a)(3) to provide utilization review on behalf of the carrierCarrier"Carrier" means: (i) an insurer; (ii) a nonprofit health service plan; (iii) a health maintenance organization; (iv) a dental plan organization; or (v) any other person that provides health benefit plans subject to regulation by the State.Md. Code Ann., Insurance § 15–10B–05.1(a)(3); and (ii) uses an artificial intelligenceArtificial intelligence"Artificial intelligence" means an engineered or machine–based system that varies in its level of autonomy and that can, for explicit or implicit objectives, infer from the input it receives how to generate outputs that can influence physical or virtual environments.Md. Code Ann., Insurance § 15–10B–05.1(a)(2), algorithm, or other software tool for the purpose of conducting utilization review on behalf of the carrierCarrier"Carrier" means: (i) an insurer; (ii) a nonprofit health service plan; (iii) a health maintenance organization; (iv) a dental plan organization; or (v) any other person that provides health benefit plans subject to regulation by the State.Md. Code Ann., Insurance § 15–10B–05.1(a)(3).
Subsection (b) defines the entities subject to the section's requirements. Coverage extends to (1) any carrier that uses or contracts with an entity that uses AI, algorithms, or other software tools for utilization review, and (2) any pharmacy benefits manager or private review agent that contracts with a carrier to provide utilization review and uses such tools. This ensures that the obligations reach both the carrier and its utilization review delegates.
(c)(1) 1 Subject to subsection (d) of this section, an entity subject to this section shall ensure that: (1) an artificial intelligenceArtificial intelligence"Artificial intelligence" means an engineered or machine–based system that varies in its level of autonomy and that can, for explicit or implicit objectives, infer from the input it receives how to generate outputs that can influence physical or virtual environments.Md. Code Ann., Insurance § 15–10B–05.1(a)(2), algorithm, or other software tool bases its determinations on: (i) an enrollee's medical or other clinical history; (ii) individual clinical circumstances as presented by a requesting provider; or (iii) other relevant clinical information contained in the enrollee's medical or other clinical record;
(c)(2) 1 an artificial intelligenceArtificial intelligence"Artificial intelligence" means an engineered or machine–based system that varies in its level of autonomy and that can, for explicit or implicit objectives, infer from the input it receives how to generate outputs that can influence physical or virtual environments.Md. Code Ann., Insurance § 15–10B–05.1(a)(2), algorithm, or other software tool does not base its determinations solely on a group dataset;
(c)(3) 2 the criteria and guidelines for using an artificial intelligenceArtificial intelligence"Artificial intelligence" means an engineered or machine–based system that varies in its level of autonomy and that can, for explicit or implicit objectives, infer from the input it receives how to generate outputs that can influence physical or virtual environments.Md. Code Ann., Insurance § 15–10B–05.1(a)(2), algorithm, or other software tool for making determinations comply with the requirements of this title;
(c)(4) 3 an artificial intelligenceArtificial intelligence"Artificial intelligence" means an engineered or machine–based system that varies in its level of autonomy and that can, for explicit or implicit objectives, infer from the input it receives how to generate outputs that can influence physical or virtual environments.Md. Code Ann., Insurance § 15–10B–05.1(a)(2), algorithm, or other software tool does not replace the role of a health care provider in the determination process under § 15–10B–07 of this subtitle;
(c)(5)–(6) 4 the use of an artificial intelligenceArtificial intelligence"Artificial intelligence" means an engineered or machine–based system that varies in its level of autonomy and that can, for explicit or implicit objectives, infer from the input it receives how to generate outputs that can influence physical or virtual environments.Md. Code Ann., Insurance § 15–10B–05.1(a)(2), algorithm, or other software tool does not result in unfair discrimination; (6) an artificial intelligenceArtificial intelligence"Artificial intelligence" means an engineered or machine–based system that varies in its level of autonomy and that can, for explicit or implicit objectives, infer from the input it receives how to generate outputs that can influence physical or virtual environments.Md. Code Ann., Insurance § 15–10B–05.1(a)(2), algorithm, or other software tool is fairly and equitably applied, including in accordance with any applicable regulations and guidance issued by the federal Department of Health and Human Services;
(c)(7) 5 an artificial intelligenceArtificial intelligence"Artificial intelligence" means an engineered or machine–based system that varies in its level of autonomy and that can, for explicit or implicit objectives, infer from the input it receives how to generate outputs that can influence physical or virtual environments.Md. Code Ann., Insurance § 15–10B–05.1(a)(2), algorithm, or other software tool is open to inspection for audit or compliance reviews by the Commissioner IN ACCORDANCE WITH SUBSECTION (E) OF THIS SECTION;
(c)(8) 6 written policies and procedures are included in the utilization plan submitted under § 15–10B–05 of this subtitle, including how an artificial intelligenceArtificial intelligence"Artificial intelligence" means an engineered or machine–based system that varies in its level of autonomy and that can, for explicit or implicit objectives, infer from the input it receives how to generate outputs that can influence physical or virtual environments.Md. Code Ann., Insurance § 15–10B–05.1(a)(2), algorithm, or other software tool will be used and what oversight will be provided;
(c)(9) 7 the performance, use, and outcomes of an artificial intelligenceArtificial intelligence"Artificial intelligence" means an engineered or machine–based system that varies in its level of autonomy and that can, for explicit or implicit objectives, infer from the input it receives how to generate outputs that can influence physical or virtual environments.Md. Code Ann., Insurance § 15–10B–05.1(a)(2), algorithm, or other software tool are reviewed and revised, if necessary and at least on a quarterly basis, to maximize accuracy and reliability, IN ACCORDANCE WITH SUBSECTION (F) OF THIS SECTION;
(c)(10) 8 patient data is not used beyond its intended and stated purpose, consistent with the federal Health Insurance Portability and Accountability Act of 1996, as applicable; and
(c)(11) 9 an artificial intelligenceArtificial intelligence"Artificial intelligence" means an engineered or machine–based system that varies in its level of autonomy and that can, for explicit or implicit objectives, infer from the input it receives how to generate outputs that can influence physical or virtual environments.Md. Code Ann., Insurance § 15–10B–05.1(a)(2), algorithm, or other software tool does not directly or indirectly cause harm to an enrollee.
Subsection (c) establishes the core operating requirements for AI tools used in utilization review. It requires that AI determinations be based on individual clinical data rather than solely on group datasets, that the tools not replace health care providers in the determination process, that the tools not result in unfair discrimination, that written policies and procedures be filed with the utilization plan, that patient data not be used beyond its intended purpose consistent with HIPAA, and that the tools not cause harm to enrollees. Notably, subsection (c)(7) is amended to cross-reference new subsection (e) for audit requirements, and subsection (c)(9) is amended to cross-reference new subsection (f) for quarterly performance review requirements.
(d) 10 An artificial intelligenceArtificial intelligence"Artificial intelligence" means an engineered or machine–based system that varies in its level of autonomy and that can, for explicit or implicit objectives, infer from the input it receives how to generate outputs that can influence physical or virtual environments.Md. Code Ann., Insurance § 15–10B–05.1(a)(2), algorithm, or other software tool may not deny, delay, or modify health care services.
Subsection (d) is the bill's categorical prohibition: an AI, algorithm, or other software tool may not deny, delay, or modify health care services. This is the core constraint that subsection (c) is "subject to" — it establishes that AI tools are limited to an advisory or supporting role and cannot independently make adverse coverage determinations.
(e) 11 AN AUDIT OR COMPLIANCE REVIEW OF AN ARTIFICIAL INTELLIGENCEArtificial intelligence"Artificial intelligence" means an engineered or machine–based system that varies in its level of autonomy and that can, for explicit or implicit objectives, infer from the input it receives how to generate outputs that can influence physical or virtual environments.Md. Code Ann., Insurance § 15–10B–05.1(a)(2), ALGORITHM, OR OTHER SOFTWARE TOOL UNDER SUBSECTION (C)(7) OF THIS SECTION SHALL INCLUDE THE HUMAN EVALUATION OF A PATIENT'S MEDICAL RECORDS BY A LICENSED HEALTH CARE PROFESSIONAL THAT TAKES INTO CONSIDERATION THE PATIENT'S SPECIFIC CIRCUMSTANCES AND ALLOWS THE LICENSED HEALTH CARE PROFESSIONAL TO QUESTION, MODIFY, OR OVERRIDE A DETERMINATION MADE BY THE ARTIFICIAL INTELLIGENCEArtificial intelligence"Artificial intelligence" means an engineered or machine–based system that varies in its level of autonomy and that can, for explicit or implicit objectives, infer from the input it receives how to generate outputs that can influence physical or virtual environments.Md. Code Ann., Insurance § 15–10B–05.1(a)(2), ALGORITHM, OR OTHER SOFTWARE TOOL.
New subsection added by HB 1385. Subsection (e) requires that any audit or compliance review of an AI utilization review tool conducted under subsection (c)(7) must include the evaluation of a patient's medical records by a licensed health care professional. The professional must consider the patient's specific circumstances and must have the authority to question, modify, or override a determination made by the AI tool. This ensures that regulatory audits are not purely technical or algorithmic — they must include individualized clinical review with real override authority.
(f)(1)–(2) 12 A REVIEW OF THE PERFORMANCE, USE, AND OUTCOMES OF ARTIFICIAL INTELLIGENCEArtificial intelligence"Artificial intelligence" means an engineered or machine–based system that varies in its level of autonomy and that can, for explicit or implicit objectives, infer from the input it receives how to generate outputs that can influence physical or virtual environments.Md. Code Ann., Insurance § 15–10B–05.1(a)(2), ALGORITHM, OR OTHER SOFTWARE TOOLS UNDER SUBSECTION (C)(9) OF THIS SECTION SHALL INCLUDE: (1) A HUMAN EVALUATION OF THE REAL–WORLD HEALTH OUTCOMES OF DECISIONS MADE BY THE ARTIFICIAL INTELLIGENCEArtificial intelligence"Artificial intelligence" means an engineered or machine–based system that varies in its level of autonomy and that can, for explicit or implicit objectives, infer from the input it receives how to generate outputs that can influence physical or virtual environments.Md. Code Ann., Insurance § 15–10B–05.1(a)(2), ALGORITHM, OR OTHER SOFTWARE TOOL; AND (2) USE OF THE FINDINGS MADE BY THE EVALUATION REQUIRED UNDER ITEM (1) OF THIS SUBSECTION TO IMPROVE THE ARTIFICIAL INTELLIGENCEArtificial intelligence"Artificial intelligence" means an engineered or machine–based system that varies in its level of autonomy and that can, for explicit or implicit objectives, infer from the input it receives how to generate outputs that can influence physical or virtual environments.Md. Code Ann., Insurance § 15–10B–05.1(a)(2), ALGORITHM, OR OTHER SOFTWARE TOOL AND MAKE THE DECISIONS OF THE ARTIFICIAL INTELLIGENCEArtificial intelligence"Artificial intelligence" means an engineered or machine–based system that varies in its level of autonomy and that can, for explicit or implicit objectives, infer from the input it receives how to generate outputs that can influence physical or virtual environments.Md. Code Ann., Insurance § 15–10B–05.1(a)(2), ALGORITHM, OR OTHER SOFTWARE TOOL SAFER, MORE ACCURATE, AND MORE RESPONSIVE TO PATIENT NEEDS.
New subsection added by HB 1385. Subsection (f) specifies what the quarterly performance review required under subsection (c)(9) must include. First, the review must incorporate a human evaluation of the real-world health outcomes of decisions made by the AI tool. Second, the findings of that evaluation must be used to improve the AI tool and make its decisions safer, more accurate, and more responsive to patient needs. This creates a closed-loop improvement requirement: review outcomes, then use the findings to improve the tool.
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect October 1, 2026.
Section 2 of the bill sets the effective date as October 1, 2026. This applies to all provisions of the bill, including the new subsections (e) and (f).