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IL HB4735: TRANSPARENCY IN DOWNCODING ACT

In Committee Illinois

Last verified Oct 11, 2026 · official bill text

HB4735 · where it stands

1 of 5 steps complete
  1. Introduced In committee
  2. Passed first chamber
  3. Passed both chambers
  4. Enacted
  5. Effective
What do these statuses mean?
Introduced
Filed in the legislature; may be waiting for a committee hearing.
Passed a chamber
Approved by one or both chambers; awaiting further action.
Enacted
Signed into law, or became law without a signature or over a veto.
Effective date
The date the law says it takes effect. Once it has passed, the page shows "Effective" and the date. A court order can still block a law; if we know of one, the summary says so.
Dead / vetoed
Vetoed, failed, or the session ended without action.

In one paragraph

Illinois's HB 4735 (104th General Assembly) would create the Transparency in Downcoding Act for certain health insurance policies. A health insurance issuer could not use an automated process, system or tool to downcode a claim, or downcode based solely on reported diagnosis codes, and downcoding decisions would have to be made by a licensed physician. Re-referred to the House Rules Committee March 27, 2026.

Plain-English summary, written with AI assistance. The official text controls.

What it means for business

Not law. If enacted, health insurance issuers could not use automated tools to downcode claims and would have to use physician review, give notices and allow appeals.

Key provisions

  1. Would prohibit issuers from using an automated process, system or tool to downcode a claim
  2. Would prohibit downcoding based solely on reported diagnosis codes, and targeted or discriminatory downcoding of physicians who routinely treat complex or chronic conditions
  3. Downcoding decisions would have to be made by a licensed physician of the same or similar specialty as one who typically manages the condition
  4. Sets notification and appeal rules for downcoded claims and enforcement by the Department of Insurance, including fines, restitution or license suspension for discriminatory patterns
  5. Excludes ERISA self-insured plans and workers' compensation health care; effective immediately if enacted
  6. Assigned to House Insurance Committee March 12, 2026; re-referred to Rules March 27, 2026

Latest legislative action

Mar 27, 2026. Rule 19(a) / Re-referred to Rules Committee

Sponsors (showing 5 of 20)

NameRole
R Primary
D Primary
Primary
Primary
Primary

Related and companion bills

Topics and industries

Related topics

AI in InsuranceAutomated Decision-MakingAI Healthcare

Affected industries

FinanceHealthcare

This page is general information, not legal advice. Summaries are AI-assisted and may contain errors; read the statute for the controlling text and talk to a lawyer about your situation. Full disclaimer · Report an error

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SB3114 TRANSPARENCY IN DOWNCODING ACT HB5395 NETWORK ADEQUACY-STANDARDS HB2472 INS-ADVERSE DETERMINATION HB5918 AI USE IN HEALTH INSURANCE ACT SB 1425 AI USE IN HEALTH INSURANCE ACT HB0035 AI USE IN HEALTH INSURANCE ACT

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Nebraska LB77 Adopt the Ensuring Transparency in Prior Authorization Act and provide for insur Maryland HB820 Health Insurance - Utilization Review - Use of Artificial Intelligence Washington SB5395 Making improvements to transparency and accountability in the prior authorizatio Minnesota HF4188 Commerce policy bill (Laws 2026, chapter 124), including article 3, section 6 ba Alabama SB 63 Health care plans; to regulate the use of artificial intelligence in determinati Iowa HF2635 A bill for an act relating to health carriers standards of conduct; utilization