California AB 512 (Prior Authorization 2025)

Restricts the use of artificial intelligence and algorithms in health care service plans and disability insurers for utilization review or management functions based on medical necessity. Requires that AI tools do not replace health care provider decision-making, discriminate, or rely solely on group datasets. Ensures AI tools base determinations on enrollee's personal and clinical data and comply with state, federal laws. Mandates periodic reviews of AI tools' performance and prohibits their causing harm to enrollees. Prohibits AI tools from independently denying, delaying, or modifying health services; such decisions must be made by licensed professionals. Obliges plans and insurers to maintain transparency about AI use in their written policies, and permit inspections for compliance audits. Aligns with federal guidance on the use of AI by health services. Applies specifically to California-based health plans and Medi-Cal managed care to the extent federal approvals are secured.