AI Frontier Institute

Making improvements to transparency and accountability in the prior authorization determination process.

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Engrossed Second Substitute Senate Bill 5395, approved March 23, 2026 as Chapter 157 of the Laws of 2026, tightens who and what may deny a health insurance claim in Washington. The Legislature found that artificial intelligence "is being increasingly utilized by health carriers to make or aid in decisions about medical necessity and coverage of provider-recommended treatment." The act amends RCW 48.43.830, 41.05.845, 48.43.525, 48.43.535 and 48.43.0161 to provide that only a licensed physician or a licensed health professional working within their scope of practice may deny a prior authorization request based on medical necessity, and that the reviewer must evaluate the specific clinical issues by considering the requesting provider's recommendation, the enrollee's medical or other clinical history, and individual clinical circumstances. The operative sentence is short: "Artificial intelligence shall not be the sole means used to deny, delay, or modify health care services. Algorithms may be used to process and approve prior authorization requests, but may not be used without human review to deny care based on a determination of medical necessity." A carrier that uses artificial intelligence for medical-necessity prior authorization, directly or through a contracted entity, must ensure the system bases its determination on the enrollee's own clinical history and individual circumstances rather than a group data set alone, does not discriminate directly or indirectly, is fairly and equitably applied, is periodically reviewed for accuracy and reliability, keeps patient data within its stated purpose, and keeps its policies and procedures open to audit by the Office of the Insurance Commissioner. Carriers' annual prior-authorization reports must disclose the percentage of total denials that were aided by artificial intelligence. The bill passed the House 94-0 and the Senate 49-0 and takes effect June 11, 2026, except two sections that take effect January 1, 2027.

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