The Health Claim Denial Transparency Act requires group health plans to disclose detailed data regarding claim denials, appeals, and the use of automated decision-making tools in their annual ERISA reports.
Lucy McBath
Representative
GA-6
The Health Claim Denial Transparency Act requires group health plans to provide greater transparency by disclosing detailed data on claim denials, appeals, and the use of automated decision-making tools in their annual reports. This legislation ensures that all group health plans, regardless of size, provide comprehensive information on why claims are denied and how they are processed. By mandating this reporting, the bill aims to hold health plans more accountable for their coverage decisions.
Health Claim Denial Transparency Act Mandates Annual Disclosure of Insurance Rejections and AI Decision-Making Data Starting Next Year.
We’ve all been there: you get a bill in the mail for a doctor’s visit you thought was covered, only to find out your insurance company quietly said 'no.' Currently, those denials happen in a black box, but this bill aims to flip the lights on. It requires the Secretary of Labor to issue new rules within one year that force group health plans to report exactly how often they’re turning people down. Plans will have to disclose the total number of claims submitted, approved, and denied, including a specific breakdown of how many times they reversed a denial after a patient actually fought back through an appeal.
The Data Deep Dive
This isn't just about broad numbers; the bill gets into the nitty-gritty of modern healthcare. Plans must categorize their data by the type of care, such as pre-service (getting permission before a procedure), post-service (the bill after the fact), and urgent care. It also singles out high-stakes areas like prescription drugs, mental health services, and cancer treatments. For a patient trying to find a plan that actually covers therapy or expensive oncology meds, this data could eventually show which insurers are most likely to put up a fight. There is a 'small-claim exception'—if a plan has 20 or fewer claims in a sensitive category like mental health, they won't report those specific numbers to protect patient privacy.
Robots in the Review Room
One of the most modern additions to this bill is the requirement to report on 'automated decision-making tools.' If an insurance company uses AI to process your claim, they have to disclose how many claims those algorithms handled and how many of them resulted in a denial. This is a direct response to the growing use of software to flag or reject medical claims at scale. By tracking these numbers, the bill creates a paper trail for how much of your healthcare is being decided by a human doctor versus a computer program.
No More Hiding in the Fine Print
This bill closes loopholes that usually let smaller companies or 'simplified' filers skip the paperwork. It specifically amends existing ERISA regulations to ensure that plans with fewer than 100 participants—think small businesses or local trade shops—still have to play by these transparency rules. Even if a plan is allowed to file a simplified annual report, they are prohibited from leaving out this claims data. While this means more administrative work for HR departments and plan administrators, for the average employee, it means more accountability from the people managing their health benefits.