Health Care Providers and Health Insurance Carriers - Use of Artificial Intelligence in Health Care Decision Making

HB 1240 prohibits health care providers and insurers from using artificial intelligence systems designed solely to cut costs at the expense of care quality, delays, or coverage denials. It requires these entities to publicly post annual data about AI-driven decisions (including misdiagnosis rates and overrides by staff) on their websites starting in 2026, and undergo third-party audits to verify alignment with medical/ethical standards. The bill directly affects hospitals, clinics, insurers, and other covered health care entities that use AI for clinical or coverage decisions. Violations could result in fines up to $10,000 per offense, with penalties considering factors like severity and history of violations.