Jeremy Avila, Senior Counsel, in the Health Care & Life Sciences practice, in the firm’s San Francisco office, authored an article in The Weekly newsletter, published by the California Society for Healthcare Attorneys, titled “Blazing a New Trail or a Case of Follow the Leader?”

Following is an excerpt:

One does not have to look too long or too hard to find or access one of the myriad artificial intelligence (“AI”) tools available to businesses and consumers alike that industry evangelists proclaim will change the way we work and live. And while some have clear applications we already can wrap our heads around—say, a student using an AI tool to write that term paper at the last minute—AI almost certainly has a lot more to show us still in terms of its full potential and contributions.

In light of this reality, the Legislature is working to define more clearly the appropriate use of AI tools in California’s healthcare industry. On February 13, 2024, State Senator Becker introduced SB 1120, which aims to set parameters around the use of AI tools by health plans with respect to utilization review and care delivery. The bill would accomplish this by requiring that algorithms, AI, or “other software tools” be used in a fair and equitable manner, pursuant to publicly disclosed policies, and that the use of such tools not supplant provider-driven decision making or review and consideration of a patient’s individualized medical history and clinical needs.

While there is still a long road ahead, the bill already has seen one substantive amendment: excising the requirement that health care service plans ensure that a licensed physician “supervise the use of artificial intelligence decision-making tools” whenever said tools are used to “inform decisions to approve, modify, or deny requests by providers for authorization prior to, or concurrent with, the provision of health care services to insureds.” This amendment came about in response to concerns over the type of supervision expected or required of physicians to ensure compliance with the proposed law. And because a violation of the Knox-Keene Act can expose a health care service plan to liability, removing such vague and ambiguous supervision language removes that category of compliance risk.

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