A new law in this state bans automated insurance claim denials

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As some health insurance companies have come under fire for allegedly using computer systems to shoot down claims, an Arizona law will soon make the practice illegal in the Grand Canyon State.

Republican Arizona House Majority Whip Rep. Julie Willoughby sponsored the legislation, and it was recently signed into law by Democratic Gov. Katie Hobbs.

House Bill 2175 requires a physician licensed in the state to conduct an "individual review" and use "independent medical judgment" to determine whether the claim should actually be denied.  

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It also required a similar review of "a direct denial of a prior authorization of a service" that a provider asked for and "involves medical necessity."

"This law ensures that a doctor, not a computer, is making medical decisions," Willoughby said in a statement. "If care is denied, it should be by someone with the training and ethical duty to put patients first. That decision must come from a licensed physician, not an anonymous program."

The law will go into effect in July 2026, so insurers will have time to be ready for the changes, if any.

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"Arizona families deserve real oversight when it comes to life-changing medical decisions," Willoughby said. "This law puts patients ahead of profits and restores a layer of accountability that's long overdue."

The bill passed both chambers with nearly unanimous support. 

Several healthcare companies, like Cigna and United Healthcare, have faced accusations of using computer systems to deny claims in past years, according to ProPublica and FOX Business.

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Fox News Digital reached out to Hobbs' office for comment. Similar legislation was signed into law in California last year, which was dubbed the "Physicians Make Decisions Act." 

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The lawmaker in the Golden State was specifically concerned about the rise of artificial intelligence.

"Artificial intelligence has immense potential to enhance health care delivery, but it should never replace the expertise and judgment of physicians," Democratic state Sen. Josh Becker said in a December statement. "An algorithm cannot fully understand a patient's unique medical history or needs, and its misuse can lead to devastating consequences."