WHAT THIS BILL REGULATES · 1 REQUIREMENT TYPE
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.
2(a) "(g) The term 'artificial intelligence systemartificial intelligence systemThe term 'artificial intelligence system' means an engineered or machine-based system, including any algorithm, predictive model, machine learning system, or automated decision-making software, that processes data to generate predictions, classifications, recommendations, or decisions and that is used to materially influence, automate, or issue determinations regarding coverage of health care items or services.PHSA § 2791(g); ERISA § 3(48); IRC § 9832(11)' means an engineered or machine-based system, including any algorithm, predictive model, machine learning system, or automated decision-making software, that processes data to generate predictions, classifications, recommendations, or decisions and that is used to materially influence, automate, or issue determinations regarding coverage of health care items or services.".
2719B(a)(1)-(3) 1 cleared
2719B(a)(4) 2 "(4) includes, in the notice required under section 2719, if an artificial intelligence systemartificial intelligence systemThe term 'artificial intelligence system' means an engineered or machine-based system, including any algorithm, predictive model, machine learning system, or automated decision-making software, that processes data to generate predictions, classifications, recommendations, or decisions and that is used to materially influence, automate, or issue determinations regarding coverage of health care items or services.PHSA § 2791(g); ERISA § 3(48); IRC § 9832(11) was used in connection with the determination— "(A) a statement that such system was used; "(B) a description of its role in the review process; and "(C) the name, professional license, and credentials of the licensed health care professional who made the determination; and
2719B(a)(5) 3 "(5) is supported by documentation maintained as part of the administrative record describing— "(A) the artificial intelligence systemartificial intelligence systemThe term 'artificial intelligence system' means an engineered or machine-based system, including any algorithm, predictive model, machine learning system, or automated decision-making software, that processes data to generate predictions, classifications, recommendations, or decisions and that is used to materially influence, automate, or issue determinations regarding coverage of health care items or services.PHSA § 2791(g); ERISA § 3(48); IRC § 9832(11) used; "(B) the role of such system in the review process; "(C) any outputs, scores, recommendations, or determinations generated by such system; and "(D) documentation demonstrating compliance with subparagraph (C); and such materials shall be considered part of the administrative record and made available to the enrollee upon request.
2719B(b) "(b) DEFINITIONS.—For purposes of this section: "(1) ADVERSE BENEFIT DETERMINATIONadverse benefit determinationThe term 'adverse benefit determination' includes an initial determination and a determination on internal appeal.PHSA § 2719B(b)(1); IRC § 9815A(b)(1).—The term 'adverse benefit determinationadverse benefit determinationThe term 'adverse benefit determination' includes an initial determination and a determination on internal appeal.PHSA § 2719B(b)(1); IRC § 9815A(b)(1)' includes an initial determination and a determination on internal appeal. "(2) ADVERSE BENEFIT DETERMINATION INVOLVING CLINICAL JUDGMENTadverse benefit determination involving clinical judgmentThe term 'adverse benefit determination involving clinical judgment' means an adverse benefit determination that is based, in whole or in part, on medical necessity, appropriateness, experimental and investigational or similar exclusions or limits, level of care, health care setting, effectiveness, clinical guidelines, utilization review criteria, other standards requiring evaluation of the enrollee's medical condition or treatment needs, or generally accepted standards of care for such treatment needs.PHSA § 2719B(b)(2); ERISA § 503; IRC § 9815A(b)(2).—The term 'adverse benefit determination involving clinical judgmentadverse benefit determination involving clinical judgmentThe term 'adverse benefit determination involving clinical judgment' means an adverse benefit determination that is based, in whole or in part, on medical necessity, appropriateness, experimental and investigational or similar exclusions or limits, level of care, health care setting, effectiveness, clinical guidelines, utilization review criteria, other standards requiring evaluation of the enrollee's medical condition or treatment needs, or generally accepted standards of care for such treatment needs.PHSA § 2719B(b)(2); ERISA § 503; IRC § 9815A(b)(2)' means an adverse benefit determinationadverse benefit determinationThe term 'adverse benefit determination' includes an initial determination and a determination on internal appeal.PHSA § 2719B(b)(1); IRC § 9815A(b)(1) that is based, in whole or in part, on medical necessity, appropriateness, experimental and investigational or similar exclusions or limits, level of care, health care setting, effectiveness, clinical guidelines, utilization review criteria, other standards requiring evaluation of the enrollee's medical condition or treatment needs, or generally accepted standards of care for such treatment needs.".
2(c) [§ 2726(a)(8)(A)(vi)] 4 "(vi) Whether an artificial intelligence systemartificial intelligence systemThe term 'artificial intelligence system' means an engineered or machine-based system, including any algorithm, predictive model, machine learning system, or automated decision-making software, that processes data to generate predictions, classifications, recommendations, or decisions and that is used to materially influence, automate, or issue determinations regarding coverage of health care items or services.PHSA § 2791(g); ERISA § 3(48); IRC § 9832(11) is used in, or materially influences, the design, development, application, or administration of such limitation and, if so, sufficient information regarding the function, operation, and effects of such system to enable the Secretary to evaluate such function, operation, and effects under such limitation with respect to mental health or substance use disorder benefits as compared to medical and surgical benefits, both as written and in operation.";
2(c)(2) [§ 2726(f)] "(f) ARTIFICIAL INTELLIGENCE AND UTILIZATION REVIEW.—The use of an artificial intelligence systemartificial intelligence systemThe term 'artificial intelligence system' means an engineered or machine-based system, including any algorithm, predictive model, machine learning system, or automated decision-making software, that processes data to generate predictions, classifications, recommendations, or decisions and that is used to materially influence, automate, or issue determinations regarding coverage of health care items or services.PHSA § 2791(g); ERISA § 3(48); IRC § 9832(11) in connection with utilization review shall constitute a treatment limitation for purposes of this section.".
Section 2 amends the Public Health Service Act. It first adds a broad definition of artificial intelligence system at § 2791(g) covering any algorithm, predictive model, machine-learning system, or automated decision software used to materially influence, automate, or issue coverage determinations. It then adds a new § 2719B requiring group health plans and issuers to ensure that every adverse benefit determination involving clinical judgment — initial or on appeal — is not issued or dictated by AI and is instead made by a licensed professional exercising independent clinical judgment who may not defer to AI output.
The section also imposes disclosure duties: the required notice must state whether AI was used, describe its role, and identify the responsible professional by name, license, and credentials. Plans must maintain supporting documentation in the administrative record and make it available to the enrollee on request. A separate parity amendment to § 2726 treats AI use in utilization review as a treatment limitation and requires plans to furnish the Secretary sufficient information to evaluate the system's function and effects on mental health/substance use benefits versus medical-surgical benefits.
3(a) [§ 3(48)] "(48) The term 'artificial intelligence systemartificial intelligence systemThe term 'artificial intelligence system' means an engineered or machine-based system, including any algorithm, predictive model, machine learning system, or automated decision-making software, that processes data to generate predictions, classifications, recommendations, or decisions and that is used to materially influence, automate, or issue determinations regarding coverage of health care items or services.PHSA § 2791(g); ERISA § 3(48); IRC § 9832(11)' means an engineered or machine-based system, including any algorithm, predictive model, machine learning system, or automated decision-making software, that processes data to generate predictions, classifications, recommendations, or decisions and that is used to materially influence, automate, or issue determinations regarding coverage of health care items or services.".
503(3)(A)-(C) 5 "(3) ensure that any adverse benefit determinationadverse benefit determinationThe term 'adverse benefit determination' includes an initial determination and a determination on internal appeal.PHSA § 2719B(b)(1); IRC § 9815A(b)(1), whether initially or upon appeal, involving clinical judgment— "(A) is not issued by an artificial intelligence systemartificial intelligence systemThe term 'artificial intelligence system' means an engineered or machine-based system, including any algorithm, predictive model, machine learning system, or automated decision-making software, that processes data to generate predictions, classifications, recommendations, or decisions and that is used to materially influence, automate, or issue determinations regarding coverage of health care items or services.PHSA § 2791(g); ERISA § 3(48); IRC § 9832(11) and is not dictated or determined by the output of such system; "(B) is made only by a licensed health care professional who is acting within the scope of the professional's license and who has training and experience in the provision of the health care item or service that is the subject of the determination; "(C) reflects the independent clinical judgment of such professional, who shall conduct an independent evaluation of the participant's or beneficiary's individual medical circumstances and shall not treat any output of an artificial intelligence systemartificial intelligence systemThe term 'artificial intelligence system' means an engineered or machine-based system, including any algorithm, predictive model, machine learning system, or automated decision-making software, that processes data to generate predictions, classifications, recommendations, or decisions and that is used to materially influence, automate, or issue determinations regarding coverage of health care items or services.PHSA § 2791(g); ERISA § 3(48); IRC § 9832(11) as presumptively valid or defer to such output in lieu of independent clinical judgment applying generally accepted standards of care;
503(3)(D) 6 cleared
503(3)(E) 7 "(E) is supported by documentation maintained as part of the administrative record describing— "(i) the artificial intelligence systemartificial intelligence systemThe term 'artificial intelligence system' means an engineered or machine-based system, including any algorithm, predictive model, machine learning system, or automated decision-making software, that processes data to generate predictions, classifications, recommendations, or decisions and that is used to materially influence, automate, or issue determinations regarding coverage of health care items or services.PHSA § 2791(g); ERISA § 3(48); IRC § 9832(11) used; "(ii) the role of such system in the review process; "(iii) any outputs, scores, recommendations, or determinations generated by such system; and "(iv) documentation demonstrating compliance with subparagraph (C); and such materials shall be considered part of the administrative record and made available to the participant or beneficiary upon request.
503 definitions For purposes of this paragraph, the term 'adverse benefit determinationadverse benefit determinationThe term 'adverse benefit determination' includes an initial determination and a determination on internal appeal.PHSA § 2719B(b)(1); IRC § 9815A(b)(1)' includes an initial determination and a determination on internal appeal, and the term 'adverse benefit determination involving clinical judgmentadverse benefit determination involving clinical judgmentThe term 'adverse benefit determination involving clinical judgment' means an adverse benefit determination that is based, in whole or in part, on medical necessity, appropriateness, experimental and investigational or similar exclusions or limits, level of care, health care setting, effectiveness, clinical guidelines, utilization review criteria, other standards requiring evaluation of the enrollee's medical condition or treatment needs, or generally accepted standards of care for such treatment needs.PHSA § 2719B(b)(2); ERISA § 503; IRC § 9815A(b)(2)' means an adverse benefit determinationadverse benefit determinationThe term 'adverse benefit determination' includes an initial determination and a determination on internal appeal.PHSA § 2719B(b)(1); IRC § 9815A(b)(1) that is based, in whole or in part, on medical necessity, appropriateness, experimental and investigational or similar exclusions or limits, level of care, health care setting, effectiveness, clinical guidelines, utilization review criteria, other standards requiring evaluation of the participant's or beneficiary's medical condition or treatment needs, or generally accepted standards of care for such treatment needs.".
3(c) [§ 712(a)(8)(A)(vi)] 8 "(vi) Whether an artificial intelligence systemartificial intelligence systemThe term 'artificial intelligence system' means an engineered or machine-based system, including any algorithm, predictive model, machine learning system, or automated decision-making software, that processes data to generate predictions, classifications, recommendations, or decisions and that is used to materially influence, automate, or issue determinations regarding coverage of health care items or services.PHSA § 2791(g); ERISA § 3(48); IRC § 9832(11) is used in, or materially influences, the design, development, application, or administration of such limitation and, if so, sufficient information regarding the function, operation, and effects of such system to enable the Secretary to evaluate such function, operation, and effects under such limitation with respect to mental health or substance use disorder benefits as compared to medical and surgical benefits, both as written and in operation.";
3(c)(2) [§ 712(h)] "(h) ARTIFICIAL INTELLIGENCE AND UTILIZATION REVIEW.—The use of an artificial intelligence systemartificial intelligence systemThe term 'artificial intelligence system' means an engineered or machine-based system, including any algorithm, predictive model, machine learning system, or automated decision-making software, that processes data to generate predictions, classifications, recommendations, or decisions and that is used to materially influence, automate, or issue determinations regarding coverage of health care items or services.PHSA § 2791(g); ERISA § 3(48); IRC § 9832(11) in connection with utilization review shall constitute a treatment limitation for purposes of this section.".
Section 3 mirrors the PHSA amendments within ERISA. It adds the same artificial intelligence system definition at ERISA § 3(48), then amends the § 503 claims-procedure requirements to impose the identical clinical-judgment duty on group health plans: adverse benefit determinations involving clinical judgment (initial or on appeal) may not be issued or dictated by AI and must reflect a licensed professional's independent evaluation of the participant's or beneficiary's medical circumstances.
As in the PHSA, plans must disclose AI involvement in the required notice, identify the responsible professional, and maintain supporting documentation in the administrative record available to the participant or beneficiary on request. The § 712 amendment treats AI use in utilization review as a treatment limitation and requires the corresponding parity information for the Secretary. Because ERISA governs self-funded employer plans, this section is the operative reach for that large plan population.
4(a) [§ 9832(11)] "(11) ARTIFICIAL INTELLIGENCE SYSTEMartificial intelligence systemThe term 'artificial intelligence system' means an engineered or machine-based system, including any algorithm, predictive model, machine learning system, or automated decision-making software, that processes data to generate predictions, classifications, recommendations, or decisions and that is used to materially influence, automate, or issue determinations regarding coverage of health care items or services.PHSA § 2791(g); ERISA § 3(48); IRC § 9832(11).—The term 'artificial intelligence systemartificial intelligence systemThe term 'artificial intelligence system' means an engineered or machine-based system, including any algorithm, predictive model, machine learning system, or automated decision-making software, that processes data to generate predictions, classifications, recommendations, or decisions and that is used to materially influence, automate, or issue determinations regarding coverage of health care items or services.PHSA § 2791(g); ERISA § 3(48); IRC § 9832(11)' means an engineered or machine-based system, including any algorithm, predictive model, machine learning system, or automated decision-making software, that processes data to generate predictions, classifications, recommendations, or decisions and that is used to materially influence, automate, or issue determinations regarding coverage of health care items or services.".
9815A(a)(1)-(3) 9 cleared
9815A(a)(4) 10 "(4) includes, in the notice required under this chapter, if an artificial intelligence systemartificial intelligence systemThe term 'artificial intelligence system' means an engineered or machine-based system, including any algorithm, predictive model, machine learning system, or automated decision-making software, that processes data to generate predictions, classifications, recommendations, or decisions and that is used to materially influence, automate, or issue determinations regarding coverage of health care items or services.PHSA § 2791(g); ERISA § 3(48); IRC § 9832(11) was used in connection with the determination— "(A) a statement that such system was used; "(B) a description of its role in the review process; and "(C) the name, professional license, and credentials of the licensed health care professional who made the determination;
9815A(a)(5) 11 "(5) is supported by documentation maintained as part of the administrative record describing— "(A) the artificial intelligence systemartificial intelligence systemThe term 'artificial intelligence system' means an engineered or machine-based system, including any algorithm, predictive model, machine learning system, or automated decision-making software, that processes data to generate predictions, classifications, recommendations, or decisions and that is used to materially influence, automate, or issue determinations regarding coverage of health care items or services.PHSA § 2791(g); ERISA § 3(48); IRC § 9832(11) used; "(B) the role of such system in the review process; "(C) any outputs, scores, recommendations, or determinations generated by such system; and "(D) documentation demonstrating compliance with subparagraph (C); and such materials shall be considered part of the administrative record and made available to the participant or beneficiary upon request.
9815A(b) "(b) DEFINITIONS.—For purposes of this section— "(1) ADVERSE BENEFIT DETERMINATIONadverse benefit determinationThe term 'adverse benefit determination' includes an initial determination and a determination on internal appeal.PHSA § 2719B(b)(1); IRC § 9815A(b)(1).—The term 'adverse benefit determinationadverse benefit determinationThe term 'adverse benefit determination' includes an initial determination and a determination on internal appeal.PHSA § 2719B(b)(1); IRC § 9815A(b)(1)' includes an initial determination and a determination on internal appeal. "(2) ADVERSE BENEFIT DETERMINATION INVOLVING CLINICAL JUDGMENTadverse benefit determination involving clinical judgmentThe term 'adverse benefit determination involving clinical judgment' means an adverse benefit determination that is based, in whole or in part, on medical necessity, appropriateness, experimental and investigational or similar exclusions or limits, level of care, health care setting, effectiveness, clinical guidelines, utilization review criteria, other standards requiring evaluation of the enrollee's medical condition or treatment needs, or generally accepted standards of care for such treatment needs.PHSA § 2719B(b)(2); ERISA § 503; IRC § 9815A(b)(2).—The term 'adverse benefit determination involving clinical judgmentadverse benefit determination involving clinical judgmentThe term 'adverse benefit determination involving clinical judgment' means an adverse benefit determination that is based, in whole or in part, on medical necessity, appropriateness, experimental and investigational or similar exclusions or limits, level of care, health care setting, effectiveness, clinical guidelines, utilization review criteria, other standards requiring evaluation of the enrollee's medical condition or treatment needs, or generally accepted standards of care for such treatment needs.PHSA § 2719B(b)(2); ERISA § 503; IRC § 9815A(b)(2)' means an adverse benefit determinationadverse benefit determinationThe term 'adverse benefit determination' includes an initial determination and a determination on internal appeal.PHSA § 2719B(b)(1); IRC § 9815A(b)(1) that is based, in whole or in part, on medical necessity, appropriateness, experimental and investigational or similar exclusions or limits, level of care, health care setting, effectiveness, clinical guidelines, utilization review criteria, other standards requiring evaluation of the participant's or beneficiary's medical condition or treatment needs, or generally accepted standards of care for such treatment needs.".
4(c) [§ 9812(a)(8)(A)(vi)] 12 "(vi) Whether an artificial intelligence systemartificial intelligence systemThe term 'artificial intelligence system' means an engineered or machine-based system, including any algorithm, predictive model, machine learning system, or automated decision-making software, that processes data to generate predictions, classifications, recommendations, or decisions and that is used to materially influence, automate, or issue determinations regarding coverage of health care items or services.PHSA § 2791(g); ERISA § 3(48); IRC § 9832(11) is used in, or materially influences, the design, development, application, or administration of such limitation and, if so, sufficient information regarding the function, operation, and effects of such system to enable the Secretary to evaluate such function, operation, and effects under such limitation with respect to mental health or substance use disorder benefits as compared to medical and surgical benefits, both as written and in operation.";
4(c)(2) [§ 9812(f)] "(f) ARTIFICIAL INTELLIGENCE AND UTILIZATION REVIEW.—The use of an artificial intelligence systemartificial intelligence systemThe term 'artificial intelligence system' means an engineered or machine-based system, including any algorithm, predictive model, machine learning system, or automated decision-making software, that processes data to generate predictions, classifications, recommendations, or decisions and that is used to materially influence, automate, or issue determinations regarding coverage of health care items or services.PHSA § 2791(g); ERISA § 3(48); IRC § 9832(11) in connection with utilization review shall constitute a treatment limitation for purposes of this section.".
4(d) clerical CLERICAL AMENDMENT.—The table of sections for subchapter B of chapter 100 of the Internal Revenue Code of 1986 is amended by inserting after the item related to section 9815 the following new item: "Sec. 9815A. Clinical judgment and artificial intelligence.".
SEC. 5 SEC. 5. EFFECTIVE DATE. The amendments made by this Act shall apply to plan years beginning on or after January 1 of the first calendar year beginning not less than 12 months after the date of the enactment of this Act.
Section 4 replicates the same regime within the Internal Revenue Code, which reaches group health plans through the Code's group-market rules. It adds the artificial intelligence system definition at § 9832(11) and a new § 9815A imposing the identical clinical-judgment duty: adverse benefit determinations involving clinical judgment may not be issued or dictated by AI and must reflect a licensed professional's independent evaluation of the participant's or beneficiary's circumstances.
The disclosure, professional-identification, and administrative-record documentation obligations mirror the PHSA and ERISA versions. The § 9812 parity amendment again treats AI use in utilization review as a treatment limitation requiring parity information for the Secretary. A clerical amendment updates the table of sections. Under Section 5, all amendments apply to plan years beginning on or after January 1 of the first calendar year beginning at least 12 months after enactment.