Alabama SB 63 (AI in prior authorization, eff. Oct 2026)

SB 63 (Alabama 2026 Regular Session; Sen. Orr), Act 2026-589, approved April 16, 2026, effective October 1, 2026. Applies to health benefit plan providers (insurers, HMOs, nonprofit plans, and internal or contracted utilization-review entities). Key provisions: (1) AI used for medical-necessity determinations on prior-authorization requests must base determinations on the enrollee's medical history, clinical circumstances unique to the enrollee presented by the requesting provider, and other clinical information in the medical record; (2) annual certification to the Department of Insurance that the AI does not rely on a group dataset, is fairly and equitably applied (including per HHS regulations and guidance), and does not discriminate against any subscriber group or enrollee; (3) any determination to deny, delay or modify a prior-authorization request based on medical necessity must be made by a licensed physician or other competent health care professional; (4) prominent written disclosure of AI use in utilization review in the provider's policies and procedures; periodic review of AI use and outcomes for accuracy and reliability; patient data not used beyond its stated purpose consistent with HIPAA; compliance may be shown by attestation. Enforcement by DOI: notice/30-day response, hearing, corrective plan; for repeat pattern violations, administrative fine up to $5,000 and/or suspension or revocation of certificate of authority. DOI to adopt rules.