Utilization review
The process of evaluating the medical necessity and appropriateness of healthcare services.
How the laws define this
Regulators consistently frame this process as an evaluation to determine insurance coverage or authorize healthcare services. Each text focuses on assessing care against rules, guidelines, or medical standards to decide coverage outcomes. The primary divergence lies in how broadly or narrowly the process and its subjects are described across jurisdictions and instruments. An Act regarding the Department of Insurance of the State of Alabama narrows the scope specifically to determining requests for prior authorization under a health benefit plan. Conversely, the Official Code of Georgia Annotated and the bill titled Health Insurance – Utilization Review – Use of Artificial Intelligence define the process more broadly as assessing the medical necessity, appropriateness, and efficiency of care, with the latter explicitly extending the review system to include procedures and facilities. Furthermore, the guidance titled Use of Artificial Intelligence in Health Care explicitly encompasses determinations made by pharmacy benefit managers alongside health insurers.
Synthesised from the 4 statutory definitions below. Each one is quoted in full, with its source.
How jurisdictions differ
What is distinctive in each definition, binding law in force first.
What it triggers
- In Maryland, utilization review prohibits AI from denying care and mandates human oversight and patient-specific decisions.source
- In Georgia, utilization review by health insurers and private review agents prohibits adverse coverage decisions based solely on AI and requires qualified human clinical peer review for denials.source
- In Colorado, utilization review by health insurers and others is subject to AI regulations establishing a framework for patient safety, equity, and human oversight.source
- In Alabama, utilization review by health benefit plan providers limits AI use in coverage determinations and authorizes the Department of Insurance to investigate violations.source
Definitions (4)
Utilization review is the process conducted by private review agents or utilization review entities to assess the medical necessity, appropriateness, and efficiency of healthcare services, often prior to or during the provision of care, to determine insurance coverage.
The process by which health insurers, pharmacy benefit managers, and other entities determine coverage for healthcare services, subject to specific AI-related regulations under the Act.
The determination of requests for prior authorization under a health benefit plan according to the rules, health care service policies, and guidelines adopted by a health benefit plan provider, or requirements imposed by law, and applicable to a health benefit plan.
A system for reviewing the necessity, appropriateness, and efficiency of health care services, procedures, and facilities. This bill specifically regulates the use of AI within this process.
Questions and answers
What does Maryland law say about AI in utilization review?
Maryland HB 820 regulates AI in utilization review by prohibiting AI from denying care and mandating human oversight and patient-specific decisions. This applies to reviewing necessity, appropriateness, and efficiency of health care services.
Can AI be used alone for denying coverage in Georgia utilization review?
Georgia SB 444 prohibits health insurers and review agents from basing adverse coverage decisions solely on AI. It requires qualified human clinical peers to review and approve any coverage denials.
How does Alabama regulate AI in health benefit plan prior authorizations?
Alabama SB 63 limits how health benefit plan providers use AI for medical necessity and coverage decisions in prior authorizations. It mandates individualized patient reviews and authorizes the Department of Insurance to investigate and discipline violations.