Companies across the United States are incorporating AI, and Wyoming lawmakers are considering how it should or shouldn’t be used by health insurance companies.
The Joint Labor, Health and Social Services Committee is reviewing the prior authorization process, or the approval your medical provider must get from your health insurance plan to make it more likely your plan will cover the cost of services or prescriptions.
The discussion comes after the Legislature passed a bill in 2024 regulating that process for insurance companies on a state level.
The Wyoming Hospital Association, which advised lawmakers on those reforms, brought several ongoing cases to the committee’s attention in its first meeting of the interim on June 24. These cases allege insurance companies are actively using AI to deny insurance claims in the thousands in other states.
One lawsuit in Minnesota claims that UnitedHealth used an AI tool that “arbitrarily” denied claims in its Medicare Advantage plan.
Wyoming law says a physician must make the final decision on a claim. The association said it might be worth expanding on the law, suggesting a definition and prohibition of AI.
Tana Howard with the Wyoming Department of Insurance also testified in front of the committee. According to her staff, they’ve received no complaints of AI insurance related abuses. Howard also believed, based on the law’s current wording, that the department could take action if an insurer were found to be letting AI make denial decisions.
However, Howard added that regulators are still figuring out how to regulate AI across the board.
“It's being applied to every type of insurance,” she said. “Whether it's [an] app on your phone, when you get in a fender-bender with your auto policy, and that claims processing has a lot of AI policies already being applied in technology.”
Representatives for insurance companies like Blue Cross Blue Shield of Wyoming, Mountain Health CO-OP and Cigna said their employers do not use AI in the claims process.
However, when questioned by lawmakers about how they would detect AI usage, Josh Hannes with the Wyoming Hospital Association said so far, employees of the insurance companies have brought AI issues to light.
“In terms of how would we know, I think in the large cases that we've cited here, what's happened is that employees of those companies came forward and made some of these claims or at least participated in the investigation,” he said.
The committee deliberated on drafting a bill to revise the wording but decided that expanding it could muddy the waters. An attorney representing Mountain Health suggested introducing the word AI may provide wiggle room for insurance companies that want to include AI in the claims process, and lawmakers believe leaving the law as-is will provide stronger legal protections.
However, all in attendance acknowledged that AI is actively changing, and amendments may be needed in the future.
Some members, like Rep. Mike Yin (D-Jackson) suggested they may look to revise the law with a working group closer to the budget session, which starts next February.
