OLYMPIA — A bipartisan bill restricting the use of artificial intelligence (AI) in making prior authorization determinations was signed into law Monday.
Senate Bill 5395, sponsored by Sen. Tina Orwall (D-Des Moines), prohibits private insurance companies and Washington’s public employee health programs from using AI as the only means to deny, delay, or modify health care services for patients.
Under the new law, health plans may use AI to process and approve prior authorization requests under certain conditions, but a licensed provider must review them to deny care based on a determination of medical necessity.
“When it comes to denying care, only physicians should have the power to make these determinations because they’ve taken an oath to do no harm — and that’s something AI systems simply cannot do,” Orwall said. “Washingtonians can now have confidence that only licensed providers are ultimately making these critical insurance decisions, not AI.”
Rep. Alicia Rule (D-Blaine), sponsor of the House companion bill, said the legislation brings necessary transparency to the prior authorization determination process.
“When people need medical care, the prior authorization process often slows access to treatment and is a barrier to care,” Rule said. “When a prior authorization is needed, those decisions should be made by qualified medical professionals, not AI. This bill brings clarity and transparency to the process to reduce delays in timely care and preserve decision making grounded in humanity.”
In 2022, Cigna doctors denied more than 300,000 claims over two months through an algorithm-based review process, spending an average of 1.2 seconds on each case. Additionally, a 2024 American Medical Association survey found more than 60% of physicians are concerned that health plans’ use of AI will increase prior authorization denial rates.
Dr. Bindu Nayak, a Wenatchee-area endocrinologist and vice president of the Washington State Medical Association (WSMA), said the new law puts reasonable guardrails that physicians remain in control of patient care decisions.
“The WSMA is grateful to see Sen. Orwall’s bill adopting common-sense guardrails for the use of AI in prior authorization processes signed into law,” Nayak said. “Prior authorizations are increasingly causing delays for patients in accessing care and driving costs for physicians who must spend time interfacing with insurers rather than delivering care. SB 5395 advances the goal of keeping patient care in the hands of physicians and not opaque AI systems.”
The new law also requires transparency in prior authorization processes and that health carriers, when denying prior authorization, include the credentials, board certifications, and specialty areas of providers who had clinical oversight of determinations when issuing notices to enrollees.
For patient care that already had prior authorization, health carriers would be prohibited in most circumstances from retrospectively denying coverage or modifying to lower services than what was approved in the original requests. The new law also gives enrollees additional recourse for retrospective denials or modifications by allowing them or their providers to have an independent organization review the decision without having to first go through the health carrier’s grievance process.
To ensure the Office of the Insurance Commissioner (OIC) has sufficient data on prior authorization decisions in Washington, health carriers will now be required to annually report the total number of requests, approvals, and denials to the agency, as well as the percentage of total denials that involved AI systems. With this information, the OIC will publish an annual report on prior authorization trends for Washington’s health carriers.
The new law goes into effect June 11.
