{"id":163,"date":"2026-05-20T21:07:43","date_gmt":"2026-05-20T21:07:43","guid":{"rendered":"https:\/\/northcarolinamovingjournal.com\/?p=163"},"modified":"2026-05-20T21:07:43","modified_gmt":"2026-05-20T21:07:43","slug":"nc-senators-consider-new-restrictions-on-artificial-intelligence-in-insurance-and-medical-billing","status":"publish","type":"post","link":"https:\/\/northcarolinamovingjournal.com\/?p=163","title":{"rendered":"NC senators consider new restrictions on artificial intelligence in insurance and medical billing"},"content":{"rendered":"
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Senator Amy Galey (R-Alamance) says artificial intelligence in medical research has led to new understanding of diseases, new treatments, and new efficiencies. But she says AI in healthcare also has the potential to be disruptive and to contribute to increased costs for patients.<\/p>\n

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Galey introduced a Wednesday that would prohibit health insurers from denying a claim based solely on the use of AI.<\/p>\n

\u201cIf the AI does not approve the claim, it must be reviewed by a living human being,\u201d Galey told members of the Senate Health Committee. \u201cWe do not want robots or computers to deny care to sick people.\u201d<\/p>\n

More controversially, H565 would also create new rules for the use of AI in hospital coding and billing.<\/p>\n

Galey says there is evidence that ambient AI is being used in medical settings not only to simplify charting, but\u00a0 also to select the most lucrative billing codes for a diagnosis. She said legislation is needed to keep AI from automatically increasing hospital bills without human oversight or intervention.<\/p>\n

\u201c[It\u2019s] resulting in a higher bill that increases costs for insurers, including Medicaid and the state health plan and the patient,\u201d said Galey.<\/p>\n

Galey pointed to a report from Rice University\u2019s Baker Institute for Public Policy that found hospital service prices have surged more than 200% since 2000.<\/p>\n

Galey said it\u2019s not labor costs or the fact that patients are sicker that drive up costs.<\/p>\n

\u201cThere is evidence that AI and hospital billing is driving the appearance of more serious diagnoses without corresponding changes in treatment,\u201d said Galey.<\/p>\n

The more serious the diagnosis, the more a hospital charges for care, according to Galey.<\/p>\n

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Sen. Gale Adcock (D-Wake), a family nurse practitioner, was skeptical of the bill. She said upcoding, which is choosing a higher billing code than warranted, is already banned. The state Department of Health and Human Services can already suspend or terminate a provider\u2019s status if they discover upcoding.<\/p>\n

Adcock called the bill \u201cone-sided\u201d and noted that it didn\u2019t address different charges for inpatient or outpatient services.<\/p>\n

\u201cI think this bill needs a great deal of work on it to achieve the balance we\u2019re looking for, and also the ability to enforce it,\u201d said Adcock.<\/p>\n

Sen. Natalie Murdock (D-Durham) said the two large hospitals in her district were concerned with how the legislation defines upcoding and fraud.<\/p>\n

\u201cThey definitely don\u2019t want to be in a position where they believe they provided a service that was needed and thought that it was appropriate, [that] they\u2019re not stuck with looking as if fraud came into play,\u201d said Murdock.<\/p>\n

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The good, the bad and the unknown: The future of AI in North Carolina<\/p>\n<\/blockquote>\n