At the National Association of Insurance Commissioners Fall 2024 meeting on Nov. 18, state insurance regulators focused on artificial intelligence, mental health parity and other emerging challenges in the health insurance industry.
Five notes:
1. Artificial intelligence
Commissioners discussed how health insurers are using AI the most for tasks such as claims processing and utilization management, while also expressing concern about the lack of a comprehensive framework to govern its use. Commissioners stressed that AI systems should be subject to continuous human review to ensure they do not lead to unfair or automated decisions against members.
2. Mental Health Parity and Addiction Equity Act
Commissioners highlighted ongoing challenges in ensuring compliance with the Mental Health Parity and Addiction Equity Act, despite new federal regulations meant to ensure that payers provide equal coverage for mental health and substance use disorder services compared to other medical benefits. Insurers, however, are working to address the need for better compliance and transparency in coverage for mental health treatments.
3. PBM transparency
Commissioners heard presentations about the need for clearer regulations surrounding PBMs, particularly around drug pricing and patient access to medications. Several states have recently enacted laws requiring PBM transparency.
4. Insurance fraud
Fraud prevention remains a top priority, and AI has brought opportunities and risks in the fight against it. Synthetic identity theft and fraudulent claims is a big challenge, and AI can be used to identify fraud patterns and enhance data analysis.
5. Climate risks
Climate change and its impact is creating a growing need for insurers to assess and mitigate climate-related risks. Insurers should be creating a framework to address the financial implications of climate change and include the use of climate scenario analysis to assess risk across their portfolios.