The California Physicians Make Decisions Act (SB 1120) regulates how health plans and insurers use AI in utilization review, the process that approves or denies coverage for care. It has been in effect since January 1, 2025.
How the California Physicians Make Decisions Act Works
AI tools must base determinations on the individual patient’s clinical information rather than group datasets alone, must not discriminate, and must be open to audit. Most importantly, an algorithm cannot make the final call to deny, delay, or modify care based on medical necessity. Only a licensed physician or qualified provider can make that determination.
Who Needs to Comply
Health plans operating in California and vendors selling utilization review AI must ensure a qualified human decision-maker sits at the end of every adverse determination. Automation can gather records, flag cases, and support the review, but it cannot own the outcome.
For patients, the law means a person with clinical credentials is accountable for any denial of care. For vendors, it means building human review into the product, not around it.
Source: California Legislative Information: SB 1120
Report a violation: If you believe a business is violating this law, you can file a complaint with the California Attorney General Consumer Protection.
