Bill > HSB766

Introduced Session

This bill relates to the licensure of artificial H.F. _____ intelligence augmented and autonomous service providers (AAASP), defined in the bill as a corporate or legal entity licensed pursuant to the bill to operate clinical artificial intelligence services that are subject to licensure. The bill establishes the board of autonomous medical practice (board) to regulate the practice of AAASPs. The board consists of one member licensed to practice medicine and surgery or osteopathic medicine and surgery, one member licensed to practice pharmacy, one member who is a registered nurse or advanced practice registered nurse, one member licensed to practice psychology, one member who is a representative of a hospital association or the chief executive officer of a hospital in this state, one member who is a health care ethicist with an advanced degree or significant professional experience in medical ethics or bioethics, four at-large members who have demonstrated expertise in health technology, artificial intelligence, systems engineering, health care administration, patient safety, or health care regulatory affairs, and one member who is not a medical professional and who represents the general public. The bill requires the director of the department of inspections, appeals, and licensing to appoint an executive director for the board, whose salary shall be set by the governor, with the approval of the senate and consistent with the pay plan for exempt positions in the executive branch of government. The executive director may employ such staff as necessary to carry out the duties of the board and take those actions that are reasonably necessary to carry out and enforce the laws and rules administered by the board, except as otherwise provided by law or rules of the board. The bill requires the board to adopt rules to set fees to offset administration of the bill. The bill also requires the board to do all of the following: grant, suspend, revoke, and monitor AAASP licenses; establish and operate or contract for a state centralized institutional review board to H.F. _____ review activities of licensees that may constitute research on humans; authorize and develop frameworks for practice agreements; conduct or contract for algorithmic safety and bias audits; and issue a state provider identifier for insurance billing. The bill allows the board to adopt rules related to licensing and professional standards. The bill prohibits the board from adopting a rule that materially restricts the practice of AAASPs or imposes a material barrier to entry to the AAASP market unless the board approves the rule by at least a two-thirds vote and publishes written findings that the restriction is supported by substantial evidence of a patient-safety risk and is the least restrictive means to address that risk. The bill requires the board to meet at least quarterly and at such additional times as necessary to carry out its duties. A meeting of the board may be called by the executive director, by the chair who shall be elected annually by the board, or upon written request of a majority of board members. Meetings of the board are subject to open meeting and public records requirements. The bill allows the board to receive complaints, conduct investigations, and issue discipline against licensees. The bill allows a licensee to contest discipline as a contested case proceeding. The bill requires a person to obtain an AAASP license to provide services using a fully autonomous AI in any circumstance, or an advisory or supervised autonomous AI in certain circumstances listed in the bill. The bill defines a fully autonomous AI as an artificial intelligence authorized to independently diagnose, treat, triage, or prescribe without the necessity of human supervision or intervention for each distinct case; a supervised autonomous AI as an artificial intelligence authorized to generate and execute a clinical action, diagnosis, or treatment plan under the supervision of a licensed human provider who retains the ability to intervene; and an advisory AI as artificial intelligence that H.F. _____ analyzes patient-specific data to generate options, potential diagnoses, risk stratification, or therapeutic suggestions to a licensed health care provider or user, where such output is intended to inform but not substitute for independent clinical judgment, and where the provider or user is expected to review, contextualize, and determine whether and how to act upon the suggestion for each patient encounter. The bill does not require a license for the provision of services using an informational AI, defined in the bill as an artificial intelligence that provides aggregated data, literature, or administrative information to a user but does not suggest a specific clinical action. The bill creates multiples classes of AAASP license, each of which shall include a modifier based on the level of autonomy employed by the artificial intelligence operated by the licensee. The bill requires an AAASP providing services that are analogous to services provided by licensed health professionals using an artificial intelligence that has not received federal clearance to obtain a class A license. For an AAASP using an artificial intelligence that has received federal clearance the bill requires a class B license. For clinical AI services providing nondiagnostic therapy, coaching, or monitoring, and which do not independently establish a diagnosis, the bill requires an AAASP to receive a class C license. The bill also establishes four levels of autonomy modifiers for AAASP licenses, including a level for AAASPs that are not required to obtain a license but voluntarily choose to do so. The bill allows an AAASP with the highest or second-highest level of autonomy modifier to issue clinical orders, and orders for prescription drugs other than controlled substances. The bill requires the board to review an application for a license for completeness within 30 days of receipt of the application. If the board does not request additional information within that time period, the board is prohibited H.F. _____ from denying an application on the basis that the application is incomplete. The bill requires the board to issue a final decision on a license application within 90 days of receipt of a complete application unless the board ethicist determines that an applicant’s proposed data collection constitutes human subjects research requiring full review by the state centralized institutional review board or an external institutional review board. If the board fails to issue a decision on an application within the time period required by the bill, the bill requires the board to issue a provisional license upon submission by the applicant of a sworn attestation under penalty of perjury that the applicant has satisfied all minimum insurance, bonding, safety, reporting, and compliance requirements for provisional licensure. The bill also includes provisions for licensure by reciprocity. The bill requires an AAASP with the highest or second-highest level of autonomy modifier to make disclosures and receive informed consent from patients prior to providing services. The bill also imposes a professional duty of loyalty on an AAASP with the highest or second-highest level of autonomy modifier that requires the AAASP to prioritize the patient’s overall welfare, which includes the optimization of clinical outcomes, financial efficiency, care coordination, and patient convenience. The bill prohibits the interface through which an artificial intelligence interacts with a patient from presenting paid commercial content, advertisements, sponsored results, or third-party marketing messages within the context of a clinical encounter, diagnosis, or treatment plan. The bill requires an AAASP to maintain an immutable clinical logic snapshot for every version of its algorithm deployed in production, including the underlying weights, decision-logic, and prompt-engineering instructions for a period of two years. The bill allows the board to perform statistical audits of an AAASP’s referral and prescription patterns. The bill requires an AAASP to comply with the requirements of the federal Health H.F. _____ Insurance Portability and Accountability Act of 1996. Under the bill, an initial license issued to an AAASP shall be provisional and valid for a period of two years, unless the board and licensee agree in writing to extend the period of provisional licensure or the licensee submits an application for expedited conversion of the provisional license to a full license. The bill allows the board to impose restrictions on the scope of operations of a provisional licensee in order to facilitate phased deployment, data collection, and validation of safety and effectiveness. The bill allows the board to maintain, modify, or remove restrictions upon the conversion of a provisional license to a full license to reflect the scope within which the AAASP has demonstrated sustained safety, effectiveness, and compliance. The bill includes specific restrictions that the board may impose on a licensee, and allows the board to impose other restrictions as determined by the board by rule. Notwithstanding any restrictions imposed by the board on a licensee, the bill allows a licensee to provide services to a patient in this state who provides informed consent and meets certain criteria listed in the bill, as demonstrated by a referral or attestation from a physician and surgeon or osteopathic physician and surgeon. The bill requires an applicant for licensure to submit proof of professional liability insurance coverage that is equivalent to that required for a human specialist in the same field. The insurance coverage must include tail coverage for a period of time equal to the statute of limitations for medical malpractice claims plus one year. The applicant must also submit fingerprints from certain individuals for the performance of a criminal background check, the name and contact information of the person who is designated responsible official of the AAASP, and a surety bond payable to the state to cover claims or operational failures not covered by insurance, in an amount determined by the board by rule, but not less than $50,000. In addition, an applicant for a H.F. _____ license under the highest or second-highest level of autonomy modifier shall submit the name and contact information of the designated medical director, who shall be responsible for oversight of clinical scope, safety protocols, escalation procedures, and quality assurance related to patient care. The medical director may be the same person as the designated responsible official. The bill also requires an applicant to submit a determination as to whether the applicant’s proposed activities constitute human subjects research under federal law. If the board ethicist determines that the applicant’s proposed activities constitute human subjects research, or if the applicant opts to treat the activities as human subjects research, the applicant must obtain approval from the state centralized institutional review board or an independent institutional review board approved by the board by rule prior to obtaining a license. As a condition of licensure, the bill requires an AAASP to submit and maintain a continuity plan, subject to approval by the board. The bill requires the continuity plan to detail procedures for the AAASP’s insolvency, license revocation, or market exit, including a plan for the transferal of patient data to a third party. The bill also requires an AAASP to maintain an escrow account or bond sufficient to cover the technical costs of data migration, which the board may seize to execute the AAASP’s continuity plan if the AAASP fails to voluntarily execute the continuity plan. The bill requires the board to adopt by rule objective safety and performance benchmarks that an AAASP must meet or exceed to qualify for an initial license under the highest autonomy modifier or to convert any provisional license to a full license. The benchmarks shall be designed to ensure that the AAASP demonstrates clinical competency, accuracy, and safety outcomes that meet or exceed the performance of a reasonably prudent human health care provider practicing in the same or similar specialty. To the maximum extent practicable, the H.F. _____ bill requires the board to align the benchmarks with federal benchmarks established for class B AAASP licensees and with benchmarks in other states with a similar regulatory framework for AAASP licensure. As a condition of license renewal, the bill requires an AAASP to submit an annual performance report demonstrating that the clinical AI service used by the AAASP continues to meet the safety benchmarks established at the time of the AAASP’s previous licensure, including adverse and reportable events as defined in the bill. The bill specifies that a clinical AI service or act is within the authorized scope of practice of a licensed AAASP if the service or act is consistent with and not expressly prohibited by this chapter or the limitations of the specific license class and modifier held by the AAASP; the service or act is consistent with the clinical AI service’s validated technical specifications, training data, intended use case, and performance parameters as submitted to the board; and performance of the service or act is within the accepted standard of care for the specific clinical task that would be provided in the same or similar clinical setting by a reasonable and prudent human health care provider with the same or similar specialty specialization. The bill waives prohibitions on the corporate practice of medicine or any other licensed clinical practice solely to the extent necessary to permit an AAASP to hold an AAASP license and to be reimbursed for clinical AI services authorized under the bill. The bill creates a provider-patient relationship when a licensed AAASP delivers a clinical AI service to a specific patient and the patient reasonably relies on that service for health care decision making, and such relationship gives rise to a professional duty, standard of care, confidentiality, and civil liability as otherwise provided by law. The designation of a person as a medical director does not constitute the practice of medicine with respect to individual patient encounters conducted by an AAASP. The bill limits H.F. _____ the liability for noneconomic damages for a provisional licensee who is in substantial compliance with the disclosure requirements of the bill to amounts specified in Code section 147.136A (noneconomic damage awards against health care providers), unless the act or omission constitutes gross negligence, reckless disregard, or willful misconduct. The bill grants the board exclusive authority to regulate, license, investigate, and discipline AAASPs, and to regulate the delivery of clinical AI services authorized under the bill. The bill does not limit the authority of a state licensing board to regulate the independent professional conduct of natural persons within that board’s jurisdiction. The bill prohibits a person from representing that the person has an AAASP license or modifier that the person does not have. The board may issue cease and desist orders and may request the attorney general to bring an action for injunctive relief to enforce the bill and may impose a civil penalty not to exceed $1,000 per violation per day. The bill requires the department of health and human services, acting in its capacity as the state administrator of Medicaid, and the insurance division to collaborate with the board to develop reimbursement codes, pilot programs, or coverage determinations for licensed AAASPs. The bill requires that reimbursement for claims submitted under a state provider identifier by a provider without a corresponding federal national provider identifier, or recognition from the federal centers for Medicare and Medicaid services, be funded exclusively through appropriations from the general fund of the state or other sources of nonfederal funds. Claims may be paid from federal funds if the federal centers for Medicare and Medicaid services issues written guidance confirming eligibility or otherwise makes clear through guidance or establishment of billing protocols that federal matching funds are available for the services. The bill also requires reimbursement for AAASP services to be based on value-based H.F. _____ care or capitation models unless the payer and board jointly determine in writing that value-based care or capitation models are impractical. The bill does not prohibit, restrict, or require licensure for the development, ownership, or private operation of artificial intelligence models, provided such models are not marketed or deployed as clinical AI services for patient care. The bill does not authorize conduct that is expressly prohibited by federal law or that would place a licensee in conflict with the Federal Food, Drug, and Cosmetic Act, the state uniform controlled substances Act, or the federal Controlled Substances Act, nor does it authorize the distribution of a commercial medical device in violation of the Federal Food, Drug, and Cosmetic Act. The bill requires the commissioner of insurance, in consultation with the board and the department of health and human services, to adopt rules and issue subregulatory guidance as necessary to integrate AAASPs into conducting the business of insurance in this state. The rules and guidance shall establish that an AAASP under the highest or second-highest autonomy modifier constitutes a recognized provider type under state-regulated health policies, health plans, and health carriers; designate appropriate billing mechanisms which may include the use of existing current procedural terminology codes with specific modifiers identifying the service as delivered by an artificial intelligence, or the adoption of new distinct billing codes as they become available; prohibit health insurance carriers from denying coverage for a medically necessary service solely because the service was provided by an AAASP, and outline standards for including artificial intelligence augmented and autonomous service providers in provider networks, including credentialing requirements that are appropriate for automated systems.

Committee Categories

No sponsors listed

Other Sponsors (1)

House Appropriations Committee (13:00:00 4/1/2026 RM 103) (on 04/01/2026)

Official Document