The American Medical Association and a bipartisan group of lawmakers are escalating efforts to curb health insurers' use of artificial intelligence to automate or accelerate denial of medical claims. An HHS watchdog investigation has highlighted concerns over algorithms making coverage decisions with little human oversight, prompting legislative action.
At issue is the growing reliance on AI tools by major insurers to process prior authorization and deny care, a practice critics say undermines the doctor-patient relationship and risks erroneous denials. The AMA's policy arm recently adopted a resolution calling for transparency and human review requirements.
Proposed legislation would require insurers to disclose when AI is used in denial decisions and mandate independent physician review for any denial based on algorithmic output. The HHS Office of Inspector General is separately examining whether these practices violate Medicare rules.
If enacted, the measures could upend a rapidly growing market for AI-powered utilization management tools and force insurers to reengineer their claims workflows. Physician groups argue that without guardrails, efficiency gains will come at the cost of patient access to care.
One insurer told STAT that AI speeds approvals for routine cases and that denials still involve clinical judgment. The debate highlights the tension between cost containment and care quality in an increasingly automated healthcare system.