Assembly Bill A1456

                             
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   1456
 
                        2025-2026 Regular Sessions
 
                           I N  A S S E M B L Y
 
                              January 9, 2025
                                ___________
 
 Introduced by M. of A. HUNTER -- read once and referred to the Committee
   on Insurance
 
 AN  ACT to amend the insurance law, in relation to the use of artificial
   intelligence for utilization review
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:

   Section 1. The insurance law is amended by adding a new section 338 to
 read as follows:
   §  338.  NOTIFICATION REGARDING THE USE OF ARTIFICIAL INTELLIGENCE FOR
 UTILIZATION REVIEW. (A) AS USED IN THIS  SECTION,  THE  FOLLOWING  TERMS
 SHALL HAVE THE FOLLOWING MEANINGS:
   (1)  "ADVERSE  DETERMINATION" SHALL HAVE THE SAME MEANING AS SUCH TERM
 IS DEFINED IN SECTION FOUR THOUSAND NINE HUNDRED OF  THE  PUBLIC  HEALTH
 LAW.
   (2)  "ARTIFICIAL  INTELLIGENCE-BASED  ALGORITHM"  MEANS ANY ARTIFICIAL
 SYSTEM THAT PERFORMS TASKS UNDER VARYING AND UNPREDICTABLE CIRCUMSTANCES
 WITHOUT SIGNIFICANT HUMAN OVERSIGHT OR THAT CAN  LEARN  FROM  EXPERIENCE
 AND IMPROVE PERFORMANCE WHEN EXPOSED TO DATA SETS.
   (3)  "CLINICAL PEER REVIEWER" SHALL HAVE THE SAME MEANING AS SUCH TERM
 IS DEFINED IN SECTION FOUR THOUSAND NINE HUNDRED OF  THE  PUBLIC  HEALTH
 LAW.
   (4)  "UTILIZATION  REVIEW" SHALL HAVE THE SAME MEANING AS SUCH TERM IS
 DEFINED IN SECTION FORTY-NINE HUNDRED OF THE PUBLIC HEALTH LAW.
   (B) THE SUPERINTENDENT SHALL REQUIRE ALL INSURERS AUTHORIZED TO  WRITE
 ACCIDENT  AND  HEALTH  INSURANCE  IN  THIS STATE, CORPORATIONS ORGANIZED
 PURSUANT TO ARTICLE FORTY-THREE OF THIS CHAPTER, AND  A  HEALTH  MAINTE-
 NANCE  ORGANIZATION  CERTIFIED  PURSUANT  TO  ARTICLE  FORTY-FOUR OF THE
 PUBLIC HEALTH LAW TO NOTIFY INSUREDS AND ENROLLEES ABOUT THE USE OR LACK
 OF USE OF ARTIFICIAL INTELLIGENCE-BASED ALGORITHMS  IN  THE  UTILIZATION
 REVIEW  PROCESS  ON  THE  ACCESSIBLE  INTERNET  WEBSITE  OF SUCH INSURER
 AUTHORIZED TO WRITE ACCIDENT AND HEALTH INSURANCE IN THIS STATE,  CORPO-
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD01878-01-5
              

 A. 1456                             2
 
 RATION  ORGANIZED  PURSUANT  TO  ARTICLE FORTY-THREE OF THIS CHAPTER, OR
 HEALTH MAINTENANCE ORGANIZATION CERTIFIED PURSUANT TO ARTICLE FORTY-FOUR
 OF THE PUBLIC HEALTH LAW.
   (C) EVERY INSURER AUTHORIZED TO WRITE ACCIDENT AND HEALTH INSURANCE IN
 THIS  STATE,  CORPORATION  ORGANIZED  PURSUANT TO ARTICLE FORTY-THREE OF
 THIS CHAPTER, AND HEALTH MAINTENANCE ORGANIZATION CERTIFIED PURSUANT  TO
 ARTICLE  FORTY-FOUR OF THE PUBLIC HEALTH LAW SHALL SUBMIT THE ARTIFICIAL
 INTELLIGENCE-BASED ALGORITHMS AND TRAINING DATA SETS THAT ARE BEING USED
 OR WILL BE USED IN THE UTILIZATION REVIEW PROCESS TO THE DEPARTMENT. THE
 DEPARTMENT SHALL IMPLEMENT A  PROCESS  THAT  ALLOWS  THE  DEPARTMENT  TO
 CERTIFY THAT THESE ARTIFICIAL INTELLIGENCE-BASED ALGORITHMS AND TRAINING
 DATA  SETS 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 ADHERE TO EVIDENCE-BASED CLINICAL
 GUIDELINES.
   (D) A CLINICAL PEER REVIEWER WHO PARTICIPATES IN A UTILIZATION  REVIEW
 PROCESS FOR 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  PURSU-
 ANT  TO  ARTICLE FORTY-FOUR OF THE PUBLIC HEALTH LAW THAT INITIALLY USES
 ARTIFICIAL INTELLIGENCE-BASED ALGORITHMS FOR A UTILIZATION REVIEW  SHALL
 OPEN  AND  DOCUMENT  THE  UTILIZATION  REVIEW OF THE INDIVIDUAL CLINICAL
 RECORDS OR DATA PRIOR TO ISSUING AN ADVERSE DETERMINATION.
   (E) (1) 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:
   (I) WHERE A VIOLATION IS MADE BY AN INSURER AUTHORIZED TO WRITE  ACCI-
 DENT  AND HEALTH INSURANCE IN THIS STATE, A CORPORATION ORGANIZED PURSU-
 ANT TO ARTICLE FORTY-THREE OF THIS  CHAPTER,  OR  A  HEALTH  MAINTENANCE
 ORGANIZATION  CERTIFIED  PURSUANT  TO  ARTICLE  FORTY-FOUR OF THE PUBLIC
 HEALTH LAW:
   (A) SUSPENSION OR REVOCATION OF LICENSE;
   (B) REFUSAL, FOR A PERIOD NOT TO EXCEED  ONE  YEAR,  TO  ISSUE  A  NEW
 LICENSE;
   (C) A FINE OF NOT MORE THAN $5,000 FOR EACH VIOLATION OF THIS SECTION;
 OR
   (D) A FINE OF NOT MORE THAN $10,000 FOR EACH WILLFUL VIOLATION OF THIS
 SECTION.
   FINES  IMPOSED  PURSUANT  TO  THE PROVISIONS OF THIS SUBPARAGRAPH ON A
 SINGLE INSURER AUTHORIZED TO WRITE ACCIDENT AND HEALTH INSURANCE IN THIS
 STATE, A CORPORATION ORGANIZED PURSUANT TO ARTICLE FORTY-THREE  OF  THIS
 CHAPTER,  OR  A  HEALTH  MAINTENANCE  ORGANIZATION CERTIFIED PURSUANT TO
 ARTICLE FORTY-FOUR OF THE  PUBLIC  HEALTH  LAW  SHALL  NOT  EXCEED  FIVE
 HUNDRED THOUSAND DOLLARS IN AGGREGATE DURING A CALENDAR YEAR.
   (II) WHERE A VIOLATION IS MADE BY A CLINICAL PEER REVIEWER:
   (A) SUSPENSION OR REVOCATION OF LICENSE;
   (B)  REFUSAL,  FOR  A  PERIOD  NOT  TO EXCEED ONE YEAR, TO ISSUE A NEW
 LICENSE;
   (C) A FINE OF NOT MORE THAN $5,000 FOR EACH VIOLATION OF THIS SECTION;
 OR
   (D) A FINE OF NOT MORE THAN $10,000 FOR EACH WILLFUL VIOLATION OF THIS
 SECTION.
   FINES IMPOSED PURSUANT TO THE PROVISIONS OF  THIS  SUBPARAGRAPH  ON  A
 SINGLE  CLINICAL  PEER  REVIEWER  SHALL  NOT EXCEED ONE HUNDRED THOUSAND
 DOLLARS IN AGGREGATE DURING A CALENDAR YEAR.
 A. 1456                             3
 
   (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.
   (F)  THE  SUPERINTENDENT  SHALL  PROMULGATE  ALL RULES AND REGULATIONS
 NECESSARY FOR THE IMPLEMENTATION OF THIS SECTION.
   § 2. 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.