Washington SB 5395 — AI in Health Insurance Prior Authorization: AI Compliance Requirements
Washington SB 5395 (signed by Governor Ferguson, effective June 11, 2026) prohibits health insurance carriers and Washington's public employee health programs from using AI as the sole means to deny, delay, or modify health care services. AI may assist in processing and approving prior authorization requests, but a licensed clinician must conduct individual review of all denials. The law also requires transparency: denial notices must include the credentials, board certifications, and specialty of the clinician who had clinical oversight. Carriers are prohibited from retroactively denying coverage or reducing approved services in most circumstances.
Key Facts
June 11, 2026
Washington Office of the Insurance Commissioner enforcement; existing insurance law penalties
What Your Business Must Do
3 compliance requirements identified. Critical requirements carry the highest risk of enforcement action.
AI Cannot Be Sole Basis for Coverage Denial
CriticalEffective June 11, 2026: AI systems may NOT be the sole means to deny, delay, or modify health care services. Any denial of prior authorization must involve review by a licensed physician or health professional working within their scope of practice who evaluates the specific clinical issues. Audit your prior authorization workflows to ensure human oversight at every denial point.
Deadline: June 11, 2026
Include Clinician Credentials in Denial Notices
High PriorityWhen issuing prior authorization denial notices to enrollees, include the credentials, board certifications, and specialty areas of the licensed clinician who had clinical oversight of the determination. Update your denial notice templates before June 11, 2026 to include this information.
Deadline: June 11, 2026
No Retroactive Denial of Approved Care
High PriorityOnce prior authorization is granted and care is provided, carriers are prohibited from retroactively denying coverage or modifying to lower services than what was approved — with limited exceptions. Implement controls to prevent post-care AI-driven coverage modifications.
Frequently Asked Questions
Does Washington SB 5395 — AI in Health Insurance Prior Authorization apply to my business?
Washington SB 5395 (signed by Governor Ferguson, effective June 11, 2026) prohibits health insurance carriers and Washington's public employee health programs from using AI as the sole means to deny, delay, or modify health care services. AI may assi. Use ComplianceIQ's free scanner to get a personalized assessment in under 5 minutes.
What is the penalty for non-compliance?
The maximum penalty under Washington SB 5395 — AI in Health Insurance Prior Authorization is: Washington Office of the Insurance Commissioner enforcement; existing insurance law penalties. Fines are typically scaled by company size, severity of violation, and whether violations were willful or accidental.
How do I comply with Washington SB 5395 — AI in Health Insurance Prior Authorization?
The 3 requirements above cover the core obligations. The fastest path to compliance is: (1) conduct an AI risk assessment, (2) document your AI systems, (3) implement transparency disclosures where required. ComplianceIQ generates all required documents automatically.
Official Source
https://www.wsma.org/Shared_Content/News/advocacy-report/2026/April%203/wsmas-latest-prior-authorization-reform-bill-signed-into-lawLast updated: 2026-04-13 — verify at source before relying on this information.
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