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)–(7) As used in this section, the following terms shall have the following meanings: (1) "Adverse determinationAdverse determination"Adverse determination" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(1)" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter. (2) "Artificial intelligence-based algorithmArtificial intelligence-based algorithm"Artificial intelligence-based algorithm" means any algorithm-based system that can, for a given set of human-defined objectives, make predictions, recommendations and/or decisions influencing real or virtual environments. An artificial intelligence-based algorithm uses machine and human-based inputs to: (A) perceive real and virtual environments; (B) abstract such perceptions into models through analysis in an automated manner; and (C) use model inference to formulate options for information or action.Ins. Law § 338(a)(2)" means any algorithm-based system that can, for a given set of human-defined objectives, make predictions, recommendations and/or decisions influencing real or virtual environments. An artificial intelligence-based algorithmArtificial intelligence-based algorithm"Artificial intelligence-based algorithm" means any algorithm-based system that can, for a given set of human-defined objectives, make predictions, recommendations and/or decisions influencing real or virtual environments. An artificial intelligence-based algorithm uses machine and human-based inputs to: (A) perceive real and virtual environments; (B) abstract such perceptions into models through analysis in an automated manner; and (C) use model inference to formulate options for information or action.Ins. Law § 338(a)(2) uses machine and human-based inputs to: (A) perceive real and virtual environments; (B) abstract such perceptions into models through analysis in an automated manner; and (C) use model inference to formulate options for information or action. (3) "Clinical peer reviewerClinical peer reviewer"Clinical peer reviewer" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(3)" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter. (4) "Emergency conditionEmergency condition"Emergency condition" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(4)" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter. (5) "Health care providerHealth care provider"Health care provider" shall have the same meaning as such term is defined by section thirty-two hundred twenty-four-a of this chapter.Ins. Law § 338(a)(5)" shall have the same meaning as such term is defined by section thirty-two hundred twenty-four-a of this chapter. (6) "InsurerInsurer"Insurer" means an insurer authorized to write accident and health insurance in this state, a corporation organized pursuant to article forty-three of this chapter, and a health maintenance organization certified pursuant to article forty-four of the public health law.Ins. Law § 338(a)(6)" means an insurerInsurer"Insurer" means an insurer authorized to write accident and health insurance in this state, a corporation organized pursuant to article forty-three of this chapter, and a health maintenance organization certified pursuant to article forty-four of the public health law.Ins. Law § 338(a)(6) authorized to write accident and health insurance in this state, a corporation organized pursuant to article forty-three of this chapter, and a health maintenance organization certified pursuant to article forty-four of the public health law. (7) "Utilization reviewUtilization review"Utilization review" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(7)" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.
Subsection (a) establishes the defined terms used throughout new Section 338. The key defined term is artificial intelligence-based algorithm, which broadly covers any algorithm-based system that makes predictions, recommendations, or decisions influencing real or virtual environments using machine and human inputs. Insurer is defined to include accident and health insurers, Article 43 corporations, and HMOs. Other terms — adverse determination, clinical peer reviewer, emergency condition, health care provider, and utilization review — are incorporated by cross-reference to existing Insurance Law § 4900.
(b)(1) 1 The superintendent shall require all insurersInsurer"Insurer" means an insurer authorized to write accident and health insurance in this state, a corporation organized pursuant to article forty-three of this chapter, and a health maintenance organization certified pursuant to article forty-four of the public health law.Ins. Law § 338(a)(6) to provide written notice to insureds, enrollees, and health care providersHealth care provider"Health care provider" shall have the same meaning as such term is defined by section thirty-two hundred twenty-four-a of this chapter.Ins. Law § 338(a)(5) about the use of artificial intelligence-based algorithmsArtificial intelligence-based algorithm"Artificial intelligence-based algorithm" means any algorithm-based system that can, for a given set of human-defined objectives, make predictions, recommendations and/or decisions influencing real or virtual environments. An artificial intelligence-based algorithm uses machine and human-based inputs to: (A) perceive real and virtual environments; (B) abstract such perceptions into models through analysis in an automated manner; and (C) use model inference to formulate options for information or action.Ins. Law § 338(a)(2) in their utilization reviewUtilization review"Utilization review" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(7) process. Such written notice shall be sent when the artificial intelligence-based algorithmArtificial intelligence-based algorithm"Artificial intelligence-based algorithm" means any algorithm-based system that can, for a given set of human-defined objectives, make predictions, recommendations and/or decisions influencing real or virtual environments. An artificial intelligence-based algorithm uses machine and human-based inputs to: (A) perceive real and virtual environments; (B) abstract such perceptions into models through analysis in an automated manner; and (C) use model inference to formulate options for information or action.Ins. Law § 338(a)(2) is first adopted by the insurerInsurer"Insurer" means an insurer authorized to write accident and health insurance in this state, a corporation organized pursuant to article forty-three of this chapter, and a health maintenance organization certified pursuant to article forty-four of the public health law.Ins. Law § 338(a)(6) and once during each subsequent policy period. In addition, such insurersInsurer"Insurer" means an insurer authorized to write accident and health insurance in this state, a corporation organized pursuant to article forty-three of this chapter, and a health maintenance organization certified pursuant to article forty-four of the public health law.Ins. Law § 338(a)(6) shall provide a clear and conspicuous notice on their websites about their use of artificial intelligence-based algorithmsArtificial intelligence-based algorithm"Artificial intelligence-based algorithm" means any algorithm-based system that can, for a given set of human-defined objectives, make predictions, recommendations and/or decisions influencing real or virtual environments. An artificial intelligence-based algorithm uses machine and human-based inputs to: (A) perceive real and virtual environments; (B) abstract such perceptions into models through analysis in an automated manner; and (C) use model inference to formulate options for information or action.Ins. Law § 338(a)(2) in the utilization reviewUtilization review"Utilization review" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(7) process.
(b)(2) 2 If artificial intelligence-based algorithmsArtificial intelligence-based algorithm"Artificial intelligence-based algorithm" means any algorithm-based system that can, for a given set of human-defined objectives, make predictions, recommendations and/or decisions influencing real or virtual environments. An artificial intelligence-based algorithm uses machine and human-based inputs to: (A) perceive real and virtual environments; (B) abstract such perceptions into models through analysis in an automated manner; and (C) use model inference to formulate options for information or action.Ins. Law § 338(a)(2) are used in the utilization reviewUtilization review"Utilization review" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(7) process, each insurerInsurer"Insurer" means an insurer authorized to write accident and health insurance in this state, a corporation organized pursuant to article forty-three of this chapter, and a health maintenance organization certified pursuant to article forty-four of the public health law.Ins. Law § 338(a)(6) shall disclose to the insured's or enrollee's health care providerHealth care provider"Health care provider" shall have the same meaning as such term is defined by section thirty-two hundred twenty-four-a of this chapter.Ins. Law § 338(a)(5), and, upon request, to the insured or enrollee, the following information: the criteria governing such artificial intelligence-based algorithmArtificial intelligence-based algorithm"Artificial intelligence-based algorithm" means any algorithm-based system that can, for a given set of human-defined objectives, make predictions, recommendations and/or decisions influencing real or virtual environments. An artificial intelligence-based algorithm uses machine and human-based inputs to: (A) perceive real and virtual environments; (B) abstract such perceptions into models through analysis in an automated manner; and (C) use model inference to formulate options for information or action.Ins. Law § 338(a)(2), the data sets used to train such artificial intelligence-based algorithmArtificial intelligence-based algorithm"Artificial intelligence-based algorithm" means any algorithm-based system that can, for a given set of human-defined objectives, make predictions, recommendations and/or decisions influencing real or virtual environments. An artificial intelligence-based algorithm uses machine and human-based inputs to: (A) perceive real and virtual environments; (B) abstract such perceptions into models through analysis in an automated manner; and (C) use model inference to formulate options for information or action.Ins. Law § 338(a)(2), the artificial intelligence-based algorithmArtificial intelligence-based algorithm"Artificial intelligence-based algorithm" means any algorithm-based system that can, for a given set of human-defined objectives, make predictions, recommendations and/or decisions influencing real or virtual environments. An artificial intelligence-based algorithm uses machine and human-based inputs to: (A) perceive real and virtual environments; (B) abstract such perceptions into models through analysis in an automated manner; and (C) use model inference to formulate options for information or action.Ins. Law § 338(a)(2) itself, and the outcomes produced by software that uses the artificial intelligence-based algorithmArtificial intelligence-based algorithm"Artificial intelligence-based algorithm" means any algorithm-based system that can, for a given set of human-defined objectives, make predictions, recommendations and/or decisions influencing real or virtual environments. An artificial intelligence-based algorithm uses machine and human-based inputs to: (A) perceive real and virtual environments; (B) abstract such perceptions into models through analysis in an automated manner; and (C) use model inference to formulate options for information or action.Ins. Law § 338(a)(2).
(b)(3) 3 An insurerInsurer"Insurer" means an insurer authorized to write accident and health insurance in this state, a corporation organized pursuant to article forty-three of this chapter, and a health maintenance organization certified pursuant to article forty-four of the public health law.Ins. Law § 338(a)(6)'s use of artificial intelligence-based algorithmsArtificial intelligence-based algorithm"Artificial intelligence-based algorithm" means any algorithm-based system that can, for a given set of human-defined objectives, make predictions, recommendations and/or decisions influencing real or virtual environments. An artificial intelligence-based algorithm uses machine and human-based inputs to: (A) perceive real and virtual environments; (B) abstract such perceptions into models through analysis in an automated manner; and (C) use model inference to formulate options for information or action.Ins. Law § 338(a)(2) in the utilization reviewUtilization review"Utilization review" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(7) process shall be disclosed to the insured or enrollee and to the insured's or enrollee's health care providerHealth care provider"Health care provider" shall have the same meaning as such term is defined by section thirty-two hundred twenty-four-a of this chapter.Ins. Law § 338(a)(5) in the notice of an adverse determinationAdverse determination"Adverse determination" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(1) made by clinical peer reviewersClinical peer reviewer"Clinical peer reviewer" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(3) pursuant to subsection (e) of section forty-nine hundred three of this chapter and subdivision five of section forty-nine hundred three of the public health law.
(b)(4) 4 Any artificial intelligence-based algorithmsArtificial intelligence-based algorithm"Artificial intelligence-based algorithm" means any algorithm-based system that can, for a given set of human-defined objectives, make predictions, recommendations and/or decisions influencing real or virtual environments. An artificial intelligence-based algorithm uses machine and human-based inputs to: (A) perceive real and virtual environments; (B) abstract such perceptions into models through analysis in an automated manner; and (C) use model inference to formulate options for information or action.Ins. Law § 338(a)(2) used in the utilization reviewUtilization review"Utilization review" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(7) process by an insurerInsurer"Insurer" means an insurer authorized to write accident and health insurance in this state, a corporation organized pursuant to article forty-three of this chapter, and a health maintenance organization certified pursuant to article forty-four of the public health law.Ins. Law § 338(a)(6) shall not base an adverse determinationAdverse determination"Adverse determination" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(1) solely on a group data set.
(b)(5) 5 Any artificial intelligence-based algorithmsArtificial intelligence-based algorithm"Artificial intelligence-based algorithm" means any algorithm-based system that can, for a given set of human-defined objectives, make predictions, recommendations and/or decisions influencing real or virtual environments. An artificial intelligence-based algorithm uses machine and human-based inputs to: (A) perceive real and virtual environments; (B) abstract such perceptions into models through analysis in an automated manner; and (C) use model inference to formulate options for information or action.Ins. Law § 338(a)(2) used in the utilization reviewUtilization review"Utilization review" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(7) process by an insurerInsurer"Insurer" means an insurer authorized to write accident and health insurance in this state, a corporation organized pursuant to article forty-three of this chapter, and a health maintenance organization certified pursuant to article forty-four of the public health law.Ins. Law § 338(a)(6) shall not directly or indirectly cause harm to the insured or enrollee.
(b)(6) 6 Any artificial intelligence-based algorithmsArtificial intelligence-based algorithm"Artificial intelligence-based algorithm" means any algorithm-based system that can, for a given set of human-defined objectives, make predictions, recommendations and/or decisions influencing real or virtual environments. An artificial intelligence-based algorithm uses machine and human-based inputs to: (A) perceive real and virtual environments; (B) abstract such perceptions into models through analysis in an automated manner; and (C) use model inference to formulate options for information or action.Ins. Law § 338(a)(2) used in the utilization reviewUtilization review"Utilization review" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(7) process by an insurerInsurer"Insurer" means an insurer authorized to write accident and health insurance in this state, a corporation organized pursuant to article forty-three of this chapter, and a health maintenance organization certified pursuant to article forty-four of the public health law.Ins. Law § 338(a)(6) shall be open to inspection for audit or compliance reviews by the superintendent in accordance with applicable state and federal laws.
(b)(7) 7 Insured and enrollee data shall not be used beyond its intended and stated purpose, consistent with the federal Health Insurance Portability and Accountability Act of 1996, as applicable.
Subsection (b) imposes a suite of affirmative obligations on insurers that use AI-based algorithms in utilization review. First, the superintendent must require written notice to insureds, enrollees, and providers about AI use, both at first adoption and annually thereafter, plus a clear website notice. Second, insurers must disclose the AI criteria, training datasets, the algorithm itself, and its outcomes to the enrollee's provider and, upon request, to the enrollee. Third, adverse determination notices must disclose AI involvement. Fourth, AI algorithms may not base an adverse determination solely on a group data set — they must consider individualized data. Fifth, AI algorithms must not directly or indirectly cause harm to the insured or enrollee. Sixth, AI algorithms must be open to inspection by the superintendent. Seventh, insured and enrollee data may not be used beyond its intended and stated purpose, consistent with HIPAA.
(c) 8 Every insurerInsurer"Insurer" means an insurer authorized to write accident and health insurance in this state, a corporation organized pursuant to article forty-three of this chapter, and a health maintenance organization certified pursuant to article forty-four of the public health law.Ins. Law § 338(a)(6) shall submit the artificial intelligence-based algorithmsArtificial intelligence-based algorithm"Artificial intelligence-based algorithm" means any algorithm-based system that can, for a given set of human-defined objectives, make predictions, recommendations and/or decisions influencing real or virtual environments. An artificial intelligence-based algorithm uses machine and human-based inputs to: (A) perceive real and virtual environments; (B) abstract such perceptions into models through analysis in an automated manner; and (C) use model inference to formulate options for information or action.Ins. Law § 338(a)(2) and training data sets that are being used or will be used in the utilization reviewUtilization review"Utilization review" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(7) process to the superintendent. Such submissions shall include, at a minimum, a certification that such artificial intelligence-based algorithmsArtificial intelligence-based algorithm"Artificial intelligence-based algorithm" means any algorithm-based system that can, for a given set of human-defined objectives, make predictions, recommendations and/or decisions influencing real or virtual environments. An artificial intelligence-based algorithm uses machine and human-based inputs to: (A) perceive real and virtual environments; (B) abstract such perceptions into models through analysis in an automated manner; and (C) use model inference to formulate options for information or action.Ins. Law § 338(a)(2) and training data sets: (1) have minimized the risk of bias based on the covered person's race, color, religious creed, ancestry, age, sex, gender, national origin, handicap or disability, and are consistent with state and federal antidiscrimination laws; (2) adhere to evidence-based clinical guidelines; (3) do not rely on information that is not in compliance with the requirements for utilization reviewUtilization review"Utilization review" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(7) pursuant to section forty-nine hundred three of this chapter and section forty-nine hundred three of the public health law; and (4) do not independently create or change clinical standards or other coverage criteria.
Subsection (c) requires every insurer to submit its AI-based algorithms and training data sets to the Superintendent of Financial Services. The submission must include a certification that the algorithms and data: (1) have minimized the risk of bias based on protected characteristics and comply with antidiscrimination laws; (2) adhere to evidence-based clinical guidelines; (3) do not rely on non-compliant information; and (4) do not independently create or change clinical standards or coverage criteria.
(d)(1) 9 An insurerInsurer"Insurer" means an insurer authorized to write accident and health insurance in this state, a corporation organized pursuant to article forty-three of this chapter, and a health maintenance organization certified pursuant to article forty-four of the public health law.Ins. Law § 338(a)(6) with a utilization reviewUtilization review"Utilization review" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(7) process that initially uses artificial intelligence-based algorithmsArtificial intelligence-based algorithm"Artificial intelligence-based algorithm" means any algorithm-based system that can, for a given set of human-defined objectives, make predictions, recommendations and/or decisions influencing real or virtual environments. An artificial intelligence-based algorithm uses machine and human-based inputs to: (A) perceive real and virtual environments; (B) abstract such perceptions into models through analysis in an automated manner; and (C) use model inference to formulate options for information or action.Ins. Law § 338(a)(2), shall ensure that adverse determinationsAdverse determination"Adverse determination" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(1) are made only by clinical peer reviewersClinical peer reviewer"Clinical peer reviewer" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(3). A clinical peer reviewerClinical peer reviewer"Clinical peer reviewer" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(3) who participates in a utilization reviewUtilization review"Utilization review" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(7) process for an insurerInsurer"Insurer" means an insurer authorized to write accident and health insurance in this state, a corporation organized pursuant to article forty-three of this chapter, and a health maintenance organization certified pursuant to article forty-four of the public health law.Ins. Law § 338(a)(6) that initially uses artificial intelligence-based algorithmsArtificial intelligence-based algorithm"Artificial intelligence-based algorithm" means any algorithm-based system that can, for a given set of human-defined objectives, make predictions, recommendations and/or decisions influencing real or virtual environments. An artificial intelligence-based algorithm uses machine and human-based inputs to: (A) perceive real and virtual environments; (B) abstract such perceptions into models through analysis in an automated manner; and (C) use model inference to formulate options for information or action.Ins. Law § 338(a)(2) for a utilization reviewUtilization review"Utilization review" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(7) shall, prior to issuing an adverse determinationAdverse determination"Adverse determination" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(1): consider the requesting health provider's recommendation, the insured's or enrollee's medical or other clinical history, as applicable, and individual clinical circumstances; open and document the utilization review of the individual clinical records and data; and comply with all requirements of article forty-nine of this chapter and article forty-nine of the public health law regarding utilization reviewUtilization review"Utilization review" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(7). In addition, a utilization reviewUtilization review"Utilization review" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(7) determination with respect to an emergency conditionEmergency condition"Emergency condition" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(4) shall require application of a prudent layperson standard to the patient's presenting symptoms, without regard to final diagnosis.
(d)(2) 10 Every insurerInsurer"Insurer" means an insurer authorized to write accident and health insurance in this state, a corporation organized pursuant to article forty-three of this chapter, and a health maintenance organization certified pursuant to article forty-four of the public health law.Ins. Law § 338(a)(6) shall submit to the superintendent, in such form and manner as the superintendent may require, data on the amount of time a clinical peer reviewerClinical peer reviewer"Clinical peer reviewer" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(3) spends examining an adverse determinationAdverse determination"Adverse determination" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(1) prior to signing off on each adverse determinationAdverse determination"Adverse determination" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(1).
(d)(3) 11 An artificial intelligence-based algorithmArtificial intelligence-based algorithm"Artificial intelligence-based algorithm" means any algorithm-based system that can, for a given set of human-defined objectives, make predictions, recommendations and/or decisions influencing real or virtual environments. An artificial intelligence-based algorithm uses machine and human-based inputs to: (A) perceive real and virtual environments; (B) abstract such perceptions into models through analysis in an automated manner; and (C) use model inference to formulate options for information or action.Ins. Law § 338(a)(2) shall not be the sole basis of an insurerInsurer"Insurer" means an insurer authorized to write accident and health insurance in this state, a corporation organized pursuant to article forty-three of this chapter, and a health maintenance organization certified pursuant to article forty-four of the public health law.Ins. Law § 338(a)(6)'s decision to deny, delay, or modify health care services based, in whole or in part, on medical necessity.
(d)(4) 12 Every clinical peer reviewerClinical peer reviewer"Clinical peer reviewer" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(3) that participates in a utilization reviewUtilization review"Utilization review" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(7) process for an insurerInsurer"Insurer" means an insurer authorized to write accident and health insurance in this state, a corporation organized pursuant to article forty-three of this chapter, and a health maintenance organization certified pursuant to article forty-four of the public health law.Ins. Law § 338(a)(6) issuing adverse determinationsAdverse determination"Adverse determination" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(1) shall issue a signed statement in accordance with paragraph one of subsection (e) of section forty-nine hundred three of this chapter or paragraph (a) of subdivision five of section forty-nine hundred three of the public health law.
Subsection (d) imposes the bill's core clinical-oversight requirements. Adverse determinations must be made only by clinical peer reviewers — not by AI alone. Before issuing an adverse determination, a clinical peer reviewer must consider the requesting provider's recommendation, the enrollee's individual clinical history, open and document the review of individual clinical records, and comply with existing utilization review law. Emergency conditions must be assessed under a prudent layperson standard applied to presenting symptoms, regardless of final diagnosis. Insurers must submit data to the superintendent on how much time clinical peer reviewers spend examining each adverse determination. AI may not be the sole basis for a denial, delay, or modification based on medical necessity. Every clinical peer reviewer issuing an adverse determination must sign a statement in accordance with existing law.
(e) 13 Every insurerInsurer"Insurer" means an insurer authorized to write accident and health insurance in this state, a corporation organized pursuant to article forty-three of this chapter, and a health maintenance organization certified pursuant to article forty-four of the public health law.Ins. Law § 338(a)(6) shall establish an ongoing quality assurance testing process that meets any requirements that the superintendent may specify with defined parameters on safety and efficacy of all artificial intelligence-based algorithmsArtificial intelligence-based algorithm"Artificial intelligence-based algorithm" means any algorithm-based system that can, for a given set of human-defined objectives, make predictions, recommendations and/or decisions influencing real or virtual environments. An artificial intelligence-based algorithm uses machine and human-based inputs to: (A) perceive real and virtual environments; (B) abstract such perceptions into models through analysis in an automated manner; and (C) use model inference to formulate options for information or action.Ins. Law § 338(a)(2), and shall submit the results of such quality assurance testing process to the superintendent at such time and in such form and manner as the superintendent may specify, but not less frequently than semiannually. The results of such quality assurance testing process shall be published on a public website within thirty days of the submission of such results to the superintendent.
Subsection (e) requires every insurer to establish an ongoing quality assurance testing process for all AI-based algorithms with defined parameters on safety and efficacy. Results must be submitted to the superintendent at least semiannually and published on a public website within thirty days of submission. This creates both a periodic regulatory reporting obligation and a public transparency obligation.
(f)(1)(A)–(B), (f)(2) A violation of the provisions of this section shall be subject to one or more of the following penalties at the discretion of the superintendent, in consultation with the commissioner of health and the commissioner of education as applicable: (A) Where a violation is made by an insurerInsurer"Insurer" means an insurer authorized to write accident and health insurance in this state, a corporation organized pursuant to article forty-three of this chapter, and a health maintenance organization certified pursuant to article forty-four of the public health law.Ins. Law § 338(a)(6): (i) suspension or revocation of license; (ii) refusal, for a period not to exceed one year, to issue a new license; (iii) a fine of not more than five thousand dollars for each violation of this section; or (iv) a fine of not more than ten thousand dollars for each willful violation of this section. Fines imposed pursuant to the provisions of this subparagraph on a single insurerInsurer"Insurer" means an insurer authorized to write accident and health insurance in this state, a corporation organized pursuant to article forty-three of this chapter, and a health maintenance organization certified pursuant to article forty-four of the public health law.Ins. Law § 338(a)(6) shall not exceed five hundred thousand dollars in aggregate during a calendar year. (B) Where a violation is made by a clinical peer reviewerClinical peer reviewer"Clinical peer reviewer" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(3): (i) suspension or revocation of license; (ii) refusal, for a period not to exceed one year, to issue a new license; (iii) a fine of not more than five thousand dollars for each violation of this section; or (iv) a fine of not more than ten thousand dollars for each willful violation of this section. Fines imposed pursuant to the provisions of this subparagraph on a single clinical peer reviewerClinical peer reviewer"Clinical peer reviewer" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(3) shall not exceed one hundred thousand dollars in aggregate during a calendar year. (2) Penalties pursuant to the provisions of this subsection shall be in addition to any other remedies or penalties that may be imposed under any other applicable law.
Subsection (f) establishes the enforcement penalty structure. The superintendent, in consultation with the commissioner of health and the commissioner of education, may impose license suspension or revocation, refusal to issue new licenses for up to one year, fines of up to $5,000 per violation or $10,000 per willful violation, with aggregate annual caps of $500,000 per insurer and $100,000 per clinical peer reviewer. Penalties are cumulative with other applicable law.
(g) The superintendent shall promulgate all rules and regulations necessary for the implementation of this section.
Subsection (g) grants the superintendent rulemaking authority to promulgate all rules and regulations necessary for implementing Section 338. This is a standard enabling provision that creates no independent compliance obligation for regulated entities.
For purposes of this paragraph, an "emergency conditionEmergency condition"Emergency condition" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(4)" means a medical or behavioral condition that, regardless of the final diagnosis, manifests itself by acute symptoms of sufficient severity, including severe pain, such that a prudent layperson, possessing an average knowledge of medicine and health, could reasonably expect the absence of immediate medical attention to result in (i) placing the health of the person afflicted with such condition in serious jeopardy, or in the case of a behavioral condition placing the health of such person or others in serious jeopardy; (ii) serious impairment to such person's bodily functions; (iii) serious dysfunction of any bodily organ or part of such person; (iv) serious disfigurement of such person; or (v) a condition described in clause (i), (ii) or (iii) of section 1867(e)(1)(A) of the Social Security Act.
Section 2 of the bill amends the definition of emergency condition in Insurance Law § 3216(i)(9)(C) to add the phrase "regardless of the final diagnosis" to the prudent layperson standard. This ensures that emergency condition determinations — including those made with AI assistance — are based on presenting symptoms, not retrospective diagnosis. This is a conforming amendment that modifies existing law and creates no new AI-specific compliance obligation.
"Emergency conditionEmergency condition"Emergency condition" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(4)" means a medical or behavioral condition that, regardless of final diagnosis, manifests itself by acute symptoms of sufficient severity, including severe pain, such that a prudent layperson, possessing an average knowledge of medicine and health, could reasonably expect the absence of immediate medical attention to result in (I) placing the health of the person afflicted with such condition in serious jeopardy, or in the case of a behavioral condition placing the health of such person or others in serious jeopardy; (II) serious impairment to such person's bodily functions; (III) serious dysfunction of any bodily organ or part of such person; (IV) serious disfigurement of such person; or (V) a condition described in clause (i), (ii), or (iii) of section 1867(e)(1)(A) of the Social Security Act.
Section 3 makes the same conforming amendment — adding "regardless of final diagnosis" — to the emergency condition definition in Insurance Law § 3216(i)(24)(E)(ii), which governs step therapy protocol override requests.
In this paragraph, an "emergency conditionEmergency condition"Emergency condition" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(4)" means a medical or behavioral condition that, regardless of the final diagnosis, manifests itself by acute symptoms of sufficient severity, including severe pain, such that a prudent layperson, possessing an average knowledge of medicine and health, could reasonably expect the absence of immediate medical attention to result in (i) placing the health of the person afflicted with such condition in serious jeopardy, or in the case of a behavioral condition placing the health of such person or others in serious jeopardy; (ii) serious impairment to such person's bodily functions; (iii) serious dysfunction of any bodily organ or part of such person; (iv) serious disfigurement of such person; or (v) a condition described in clause (i), (ii) or (iii) of section 1867(e)(1)(A) of the Social Security Act.
Section 4 makes the same conforming amendment to the emergency condition definition in Insurance Law § 3221(k)(4)(C), which governs group accident and health insurance policies.
For the purpose of this provision, "emergency conditionEmergency condition"Emergency condition" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(4)" means a medical or behavioral condition that, regardless of the final diagnosis, manifests itself by acute symptoms of sufficient severity, including severe pain, such that a prudent layperson, possessing an average knowledge of medicine and health, could reasonably expect the absence of immediate medical attention to result in (i) placing the health of the person afflicted with such condition in serious jeopardy, or in the case of a behavioral condition placing the health of such person or others in serious jeopardy; (ii) serious impairment to such person's bodily functions; (iii) serious dysfunction of any bodily organ or part of such person; (iv) serious disfigurement of such person; or (v) a condition described in clause (i), (ii) or (iii) of section 1867(e)(1)(A) of the Social Security Act.
Section 5 makes the same conforming amendment to the emergency condition definition in Insurance Law § 4303(a)(2)(C), which governs health maintenance organization contracts.
"Emergency conditionEmergency condition"Emergency condition" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(4)" means a medical or behavioral condition that, regardless of the final diagnosis, manifests itself by acute symptoms of sufficient severity, including severe pain, such that a prudent layperson, possessing an average knowledge of medicine and health, could reasonably expect the absence of immediate medical attention to result in (1) placing the health of the person afflicted with such condition in serious jeopardy, or in the case of a behavioral condition placing the health of such person or others in serious jeopardy; (2) serious impairment to such person's bodily functions; (3) serious dysfunction of any bodily organ or part of such person; (4) serious disfigurement of such person; or (5) a condition described in clause (i), (ii) or (iii) of section 1867(e)(1)(A) of the Social Security Act.
Section 6 makes the same conforming amendment to the emergency condition definition in Insurance Law § 4900(c), which is the utilization review article's own definition section.
3. "Emergency conditionEmergency condition"Emergency condition" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(4)" means a medical or behavioral condition that, regardless of the final diagnosis, manifests itself by acute symptoms of sufficient severity, including severe pain, such that a prudent layperson, possessing an average knowledge of medicine and health, could reasonably expect the absence of immediate medical attention to result in (a) placing the health of the person afflicted with such condition in serious jeopardy, or in the case of a behavioral condition, placing the health of such person or others in serious jeopardy; (b) serious impairment to such person's bodily functions; (c) serious dysfunction of any bodily organ or part of such person; (d) serious disfigurement of such person; or (e) a condition described in clause (i), (ii) or (iii) of section 1867(e)(1)(A) of the Social Security Act.
Section 7 makes the same conforming amendment to the emergency condition definition in Public Health Law § 4900(3), the Public Health Law's parallel utilization review definition.
(e)(1)(i) 14 the reasons for the determination including the clinical rationale, if any, and the specific coverage or clinical criteria that were not satisfied, including explicit identification of the relevant language contained in any clinical criteria relied upon to make the adverse determinationAdverse determination"Adverse determination" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(1) and a clear explanation of the rationale supporting the determination that such clinical criteria were deemed not satisfied;
(e)(1)(v) 15 a statement signed by the clinical peer reviewerClinical peer reviewer"Clinical peer reviewer" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(3) that made the adverse determinationAdverse determination"Adverse determination" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(1) containing the following information: (a) the full printed name of such clinical peer reviewerClinical peer reviewer"Clinical peer reviewer" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(3); (b) such clinical peer reviewerClinical peer reviewer"Clinical peer reviewer" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(3)'s national provider identification number; (c) such clinical peer reviewerClinical peer reviewer"Clinical peer reviewer" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(3)'s credentials, including any board certifications and areas of specialty expertise and training, as applicable; (d) the taxonomy code of such clinical peer reviewerClinical peer reviewer"Clinical peer reviewer" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(3); (e) an attestation by such clinical peer reviewerClinical peer reviewer"Clinical peer reviewer" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(3) that they have the appropriate training and expertise in the field of medicine that is sufficient to make an informed decision regarding the medical necessity of the health care service or supply being requested on behalf of the insured and that they have no conflicts of interest that would interfere with their ability to make an impartial determination based on the merits of the specific patient case; (f) documentation of the amount of time such clinical peer reviewerClinical peer reviewer"Clinical peer reviewer" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(3) spent evaluating the medical record or other information related to the review before confirming the adverse determinationAdverse determination"Adverse determination" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(1); (g) an indication of whether such clinical peer reviewerClinical peer reviewer"Clinical peer reviewer" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(3) reviewed a prepared summary of the patient's medical records or the patient's actual medical records in making their adverse determinationAdverse determination"Adverse determination" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(1); and
(e)(1)(vi) 16 a statement as to whether an artificial intelligence-based algorithmArtificial intelligence-based algorithm"Artificial intelligence-based algorithm" means any algorithm-based system that can, for a given set of human-defined objectives, make predictions, recommendations and/or decisions influencing real or virtual environments. An artificial intelligence-based algorithm uses machine and human-based inputs to: (A) perceive real and virtual environments; (B) abstract such perceptions into models through analysis in an automated manner; and (C) use model inference to formulate options for information or action.Ins. Law § 338(a)(2), as such term is defined by section three hundred thirty-eight of this chapter, was used in the utilization reviewUtilization review"Utilization review" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(7) process, and a plain language explanation as to how such artificial intelligence-based algorithmArtificial intelligence-based algorithm"Artificial intelligence-based algorithm" means any algorithm-based system that can, for a given set of human-defined objectives, make predictions, recommendations and/or decisions influencing real or virtual environments. An artificial intelligence-based algorithm uses machine and human-based inputs to: (A) perceive real and virtual environments; (B) abstract such perceptions into models through analysis in an automated manner; and (C) use model inference to formulate options for information or action.Ins. Law § 338(a)(2) was employed and where the insured and health care providerHealth care provider"Health care provider" shall have the same meaning as such term is defined by section thirty-two hundred twenty-four-a of this chapter.Ins. Law § 338(a)(5) can find more information about the specific usage of such artificial intelligence-based algorithmArtificial intelligence-based algorithm"Artificial intelligence-based algorithm" means any algorithm-based system that can, for a given set of human-defined objectives, make predictions, recommendations and/or decisions influencing real or virtual environments. An artificial intelligence-based algorithm uses machine and human-based inputs to: (A) perceive real and virtual environments; (B) abstract such perceptions into models through analysis in an automated manner; and (C) use model inference to formulate options for information or action.Ins. Law § 338(a)(2).
Section 8 amends the adverse determination notice requirements in Insurance Law § 4903(e)(1) to add two new mandatory components. First, the notice must now include the specific coverage or clinical criteria that were not satisfied, with explicit identification of relevant language in the clinical criteria and a clear explanation of why they were deemed unsatisfied. Second, the notice must include a signed statement from the clinical peer reviewer with their full name, NPI number, credentials, taxonomy code, an attestation of appropriate training and absence of conflicts, documentation of time spent reviewing, and an indication of whether they reviewed actual records or a summary. Third, the notice must state whether an AI-based algorithm was used, provide a plain language explanation of how it was employed, and direct the insured and provider to more information about the specific AI usage.
(5)(a)(i) 17 the reasons for the determination including the clinical rationale, if any, and the specific coverage or clinical criteria that were not satisfied, including explicit identification of the relevant language contained in any clinical criteria relied upon to make the adverse determinationAdverse determination"Adverse determination" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(1) and a clear explanation of the rationale supporting the determination that such clinical criteria were deemed not satisfied;
(5)(a)(v) 18 a statement signed by the physician who made the adverse determinationAdverse determination"Adverse determination" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(1) containing the following information: (A) the full printed name of such physician; (B) such physician's national provider identification number; (C) such physician's credentials, including any board certifications and areas of specialty expertise and training, as applicable; (D) the taxonomy code of such physician; (E) an attestation by such physician that they have the appropriate training and expertise in the field of medicine that is sufficient to make an informed decision regarding the medical necessity of the health care service or supply being requested on behalf of the insured and that they have no conflicts of interest that would interfere with their ability to make an impartial determination based on the merits of the specific patient case; (F) documentation of the amount of time such physician spent evaluating the medical record or other information related to the review before confirming the adverse determinationAdverse determination"Adverse determination" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(1); (G) an indication of whether such physician reviewed a prepared summary of the patient's medical records or the patient's actual medical records in making their adverse determinationAdverse determination"Adverse determination" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(1); and
(5)(a)(vi) 19 a statement as to whether an artificial intelligence-based algorithmArtificial intelligence-based algorithm"Artificial intelligence-based algorithm" means any algorithm-based system that can, for a given set of human-defined objectives, make predictions, recommendations and/or decisions influencing real or virtual environments. An artificial intelligence-based algorithm uses machine and human-based inputs to: (A) perceive real and virtual environments; (B) abstract such perceptions into models through analysis in an automated manner; and (C) use model inference to formulate options for information or action.Ins. Law § 338(a)(2), as such term is defined by section three hundred thirty-eight of this chapter, was used in the utilization reviewUtilization review"Utilization review" shall have the same meaning as such term is defined by section forty-nine hundred of this chapter.Ins. Law § 338(a)(7) process, and a plain language explanation as to how such artificial intelligence-based algorithmArtificial intelligence-based algorithm"Artificial intelligence-based algorithm" means any algorithm-based system that can, for a given set of human-defined objectives, make predictions, recommendations and/or decisions influencing real or virtual environments. An artificial intelligence-based algorithm uses machine and human-based inputs to: (A) perceive real and virtual environments; (B) abstract such perceptions into models through analysis in an automated manner; and (C) use model inference to formulate options for information or action.Ins. Law § 338(a)(2) was employed and where the insured and health care providerHealth care provider"Health care provider" shall have the same meaning as such term is defined by section thirty-two hundred twenty-four-a of this chapter.Ins. Law § 338(a)(5) can find more information about the specific usage of such artificial intelligence-based algorithmArtificial intelligence-based algorithm"Artificial intelligence-based algorithm" means any algorithm-based system that can, for a given set of human-defined objectives, make predictions, recommendations and/or decisions influencing real or virtual environments. An artificial intelligence-based algorithm uses machine and human-based inputs to: (A) perceive real and virtual environments; (B) abstract such perceptions into models through analysis in an automated manner; and (C) use model inference to formulate options for information or action.Ins. Law § 338(a)(2).
Section 9 makes parallel amendments to Public Health Law § 4903(5)(a), adding the same enhanced adverse determination notice requirements as Section 8 adds to Insurance Law § 4903(e)(1). The Public Health Law version uses "physician" rather than "clinical peer reviewer" for the signed statement. The requirements are substantively identical: enhanced denial rationale, a signed physician statement with credentials and time-spent documentation, and AI-use disclosure with plain language explanation.
This act shall take effect on the sixtieth day after it shall have become a law. Effective immediately, the addition, amendment and/or repeal of any rule or regulation necessary for the implementation of this act on its effective date are authorized to be made and completed on or before such effective date.
Section 10 provides that the act takes effect on the sixtieth day after it becomes law, with immediate authorization for the superintendent to begin rulemaking in advance of the effective date.