What California Senate Bill 1120 (Becker) - Physicians Make Decisions Act, Health Care Coverage: Utilization Review (2024) - Restrictions on AI, Algorithm, and Software Tool Use in Utilization Review by Health Care Service Plans and Disability Insurers; Amendments to Health and Safety Code Section 1367.01 and Insurance Code Section 10123.135 requires
California Senate Bill 1120 (Becker), the Physicians Make Decisions Act, amends Section 1367.01 of the California Health and Safety Code (governing health care service plans regulated by the Department of Managed Health Care under the Knox-Keene Health Care Service Plan Act of 1975) and Section 10123.135 of the Insurance Code (governing disability insurers regulated by the Department of Insurance) to constrain how artificial intelligence, algorithms, and other software tools may be used in utilization review or utilization management functions. SB 1120 preserves the longstanding rule in subdivision (e) of each amended section that no individual other than a licensed physician or a licensed health care professional competent to evaluate the specific clinical issues involved may deny or modify requests for authorization of health care services for reasons of medical necessity, and it adds a parallel restriction targeting AI tools: an artificial intelligence, algorithm, or other software tool 'shall not deny, delay, or modify health care services based, in whole or in part, on medical necessity'; a determination of medical necessity shall be made only by a licensed physician or licensed health care professional competent to evaluate the specific clinical issues involved in the health care services requested, by reviewing and considering the requesting provider's recommendation, the enrollee's medical or other clinical history, and individual clinical circumstances. Where an AI/algorithm/software tool is used in utilization review or utilization management, the plan or insurer shall ensure that the tool: (A) bases its determination on enrollee-specific information including the enrollee's medical history and individual clinical circumstances, not solely on a group dataset (subdivision (B)); (C) criteria and guidelines comply with the applicable chapter including Section 1363.5; and (F) the tool is fairly and equitably applied including in accordance with applicable regulations and guidance issued by the federal Department of Health and Human Services. The bill preserves all existing utilization-review timeframes - within 24 hours of decision communication to the provider, no more than 72 hours for imminent-and-serious-threat conditions per Section 2719 of the federal Public Health Service Act (42 U.S.C. § 300gg-19), and the standard five-business-day non-urgent decision deadline - and preserves the Director of the Department of Managed Health Care's and the Insurance Commissioner's administrative-penalty authority for noncompliance. SB 1120 was approved by Governor Newsom on 28 September 2024 and chaptered the same day; the operative date is 1 January 2025 under California's standard rule for non-urgency statutes. Because Knox-Keene wilful violations are crimes (Health and Safety Code), the bill imposes a state-mandated local program.
Pillar: Medical & Healthcare · Authority: California State Legislature; bill approved by Governor Gavin Newsom 28 September 2024; chaptered as Chapter 879, Statutes of 2024 (SB 1120, Becker); enrolled bill text published by California Legislative Counsel via leginfo.legislature.ca.gov · Version: 1.0.1 · Last updated:
Primary source: https://leginfo.legislature.ca.gov/faces/billNavClient.xhtml?bill_id=202320240SB1120
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Primary Citations — 13 traced to source
- California Senate Bill 1120 (Becker), Health Care Coverage: Utilization Review (2023-2024 Regular Session); approved by Governor 28 September 2024; chaptered as Chapter 879, Statutes of 2024
- California Health and Safety Code Section 1367.01 (as amended by SB 1120) - utilization review and utilization management requirements for health care service plans regulated under the Knox-Keene Health Care Service Plan Act
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