SB815 - Relating to the use of certain automated systems in, and certain adverse determinations made in connection with, the health benefit claims process.

      S.B. No. 815         AN ACT   relating to the use of certain automated systems in, and certain   adverse determinations made in connection with, the health benefit   claims process.          BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:          SECTION 1.  Section 4201.002, Insurance Code, is amended by   amending Subdivision (1) and adding Subdivisions (1-a), (1-b), and   (1-c) to read as follows:                (1)  "Adverse determination" means a determination by a   utilization review agent that health care services provided or   proposed to be provided to a patient are not medically necessary or   appropriate or are experimental or investigational.                 (1-a)     "Algorithm" means a computerized procedure   consisting of a set of steps used to accomplish a determined task.                 (1-b)     "Artificial intelligence system" means any   machine learning-based system that, for any explicit or implicit   objective, infers from the inputs the system receives how to   generate outputs, including content, decisions, predictions, and   recommendations, that can influence physical or virtual   environments.                 (1-c)     "Automated decision system" means an algorithm,   including an algorithm incorporating an artificial intelligence   system, that uses data-based analytics to make, suggest, or   recommend certain determinations, decisions, judgments, or   conclusions.          SECTION 2.  Subchapter D, Chapter 4201, Insurance Code, is   amended by adding Section 4201.156 to read as follows:           Sec.   4201.156.     USE OF AUTOMATED DECISION SYSTEM FOR ADVERSE   DETERMINATIONS. (a)     A utilization review agent may not use an   automated decision system to make, wholly or partly, an adverse   determination.           (b)     The commissioner may audit and inspect at any time a   utilization review agent's use of an automated decision system for   utilization review.           (c)     This section does not prohibit the use of an algorithm,   artificial intelligence system, or automated decision system for   administrative support or fraud-detection functions.          SECTION 3.  Section 4201.303(a), Insurance Code, is amended   to read as follows:          (a)  Notice of an adverse determination must include:                (1)  the principal reasons for the adverse   determination;                (2)  the clinical basis for the adverse determination;                (3)  a description of and [ or ] the source of the   screening criteria and review procedures used as guidelines in   making the adverse determination; and                (4)  a description of the procedure for the complaint   and appeal process, including notice to the enrollee of the   enrollee's right to appeal an adverse determination to an   independent review organization and of the procedures to obtain   that review.          SECTION 4.  Chapter 4201, Insurance Code, as amended by this   Act, applies only to utilization review conducted for a health   benefit plan delivered, issued for delivery, or renewed on or after   January 1, 2026.  Utilization review conducted for a health benefit   plan delivered, issued for delivery, or renewed before January 1,   2026, is governed by the law as it existed immediately before the   effective date of this Act, and that law is continued in effect for   that purpose.          SECTION 5.  This Act takes effect September 1, 2025.               ______________________________ ______________________________      President of the Senate Speaker of the House                 I hereby certify that S.B. No. 815 passed the Senate on   March 26, 2025, by the following vote:  Yeas 30, Nays 0, one   present not voting.       ______________________________   Secretary of the Senate                I hereby certify that S.B. No. 815 passed the House on   May 24, 2025, by the following vote:  Yeas 116, Nays 13, two   present not voting.       ______________________________   Chief Clerk of the House            Approved:     ______________________________                Date       ______________________________              Governor