A Texas lawmaker is trying to push for the state to tighten controls on health insurance companies using artificial intelligence (AI) to handle patient claims.
Newsweek has contacted Texas Senator Charles Schwertner, who filed the new legislation, via email for comment.
Why It Matters
Implementing greater controls on the use of AI in health insurance providers’ handling of patient claims is something a number of other states have also done, including California, Georgia, New York and Pennsylvania.
This comes as part of the wave of scrutiny against health insurance companies following the assassination of United Healthcare CEO Brian Thompson, as some subsequently accused the health providers of treating customers unfairly.
What To Know
Senator Schwertner filed the legislation on January 16, and the proposed law would prohibit health insurance companies from using AI technology as “the sole basis” to determine medical necessity on behalf of patients.
“Only a physician or licensed health care provider acting in accordance with this chapter may determine medical necessity or appropriateness of health care items and services,” the legislation added.
The legislation would also give the Texas Department of Insurance the authority to inspect a health insurance company’s use of AI and its compliance with the AI ruling at any point.
Health insurance companies have been increasingly moving toward using AI technologies to automate routine tasks, making claim processing faster and reducing administration burdens, according to the news outlet journalistsresource.org.
However, a number of states have flagged concerns about the smart software creating inaccuracies and bias in health care decision making, warning that patient health care is not being fairly reviewed.
Per the journalistsresource.org report, the major health insurers Humana, Cigna, and UnitedHealth all faced lawsuits at the start of 2024 alleging that the companies improperly developed algorithms that guided AI programs to deny health care.
According to Bloomberg Law, the health insurance giants were being accused of using AI tools that were overriding doctors’ recommendations on needed care, forcing many patients to pay for treatment on their own or go without care.
As the use of AI in health insurance decision-making has being more widely scrutinized, at least 40 states have introduced or passed legislation on AI regulation in 2024, Bloomberg Law reported.
What People Are Saying
Research Assistant Professor at the Center for Digital Ethics at Georgetown University Will Fleisher, told Newsweek via email that one of the issues with the use of AI in health care is “transparency.”
He said: “AI systems are often hard for people to understand. For the most sophisticated and complex AI systems, like [large language models], even their developers don’t fully understand how they work. This lack of transparency poses several problems for patients. If a claim is denied by a complex AI system, the company might not be able to explain why it was denied, and even if the company really does understand why, they might use the opacity of the AI system as an excuse to refuse to explain, blaming the lack of explanation on the opacity of the AI system.
“AI systems also famously suffer from algorithmic bias: they make decisions that are biased against people from marginalized or minority groups. This might involve worse performance for people from specific groups, or it might involve more obviously discriminatory outcomes. In this case, bias might mean more claims denied for people of color or other marginalized groups.”
He added: “There is an obvious danger that the design of the AI system, and the social system that works around it, will be designed in a way that promotes profit at the expense of people’s health care.”
Texas Coalition for Patients spokesperson Katherine McLane, said in the coalition’s press release responding to the proposed bill: “Patients deserve a health care system that treats them as human beings, not data points. AI may have its place in streamlining operations, but when it comes to life-altering medical decisions, nothing can replace doctors’ expertise and patients’ unique needs.”
Texas Senator Charles Schwertner, said according to the News Nation report: “Artificial intelligence is a technology that is still rapidly developing and has enormous potential to support many systems, including health care. However, this technology should not be used to make critical, sometimes lifesaving decisions regarding a patient’s care. We simply cannot and should not solely rely on algorithms to understand the complexities and unique needs of patients.”
What’s Next
Senator Schwertner proposed for the bill to be brought into action on September 1, 2025, but it is still currently being processed.
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