In one paragraph
Not law. SB 1261 would have regulated how Tennessee health insurers, TennCare and state employee plans use AI, algorithms and software in utilization review. Tools would have had to base decisions on the patient's own clinical history rather than group data alone, not replace provider judgment or discriminate, and be reviewed periodically. AI could not deny, delay or modify care based on medical necessity; only a licensed physician or qualified health professional could decide that. Violations would have been unfair claims practices, with a right to sue. It never left committee and died when the 114th General Assembly adjourned.
Plain-English summary, written with AI assistance. The official text controls.
What it means for business
None: the bill died, so Tennessee health insurers have no new AI utilization-review rules under it.
Key provisions
- Covers health insurance issuers, including HMOs, pharmacy benefit managers and third-party administrators, plus TennCare, CoverKids and state employee group plans
- AI or software used for utilization review must base decisions on the enrollee's clinical history and individual circumstances, not solely on group data
- Tools may not supplant provider decision-making, discriminate against enrollees or harm them; insurers must disclose their use in written policies and review performance periodically
- AI may not deny, delay or modify care based on medical necessity; only a licensed physician or competent licensed health professional may decide medical necessity
- Patient data may not be used beyond its intended and stated purpose, consistent with HIPAA
- Violations are unfair claims practices; aggrieved individuals may sue for actual and punitive damages and attorney fees
- Referred to the Senate Commerce and Labor Committee February 12, 2025; no further action before the 114th General Assembly adjourned
Latest legislative action
Feb 12, 2025. Passed on Second Consideration, refer to Senate Commerce and Labor Committee; no further action before the 114th General Assembly adjourned
Sponsors (showing 5 of 8)
| Name | Role |
|---|---|
| Akbari | Primary |
| Baum | Primary |
| Gresham | Primary |
| Moody | Primary |
| Norris | Primary |
Topics and industries
Related topics
Affected industries
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