Doctor digital screen AI driven healthcare

AI in health care: regulatory and legislative outlook

What health care leaders need to know about today’s policy landscape and the value that AI can help deliver

Advancements in artificial intelligence (AI), particularly the dawn of generative AI and products such as OpenAI’s ChatGPT that can generate new content based on analysis of large amounts of data, have created global interest in how AI can change the way we work and live. The health care sector has been at the forefront of this evolution, and some have suggested that AI could be used to help temper rising federal and state health care costs¹ and provide nonfinancial benefits, such as improved quality, access, patient experience and clinician satisfaction.²

This brief explores some of the key executive, regulatory and legislative actions the US government has taken to date on the use of AI in the health care industry.

AI usage in health care

As the use of AI becomes more prevalent, and the tools’ capabilities more advanced, many have raised concerns about its inherent risks. Stakeholders have also urged the government to take quick and decisive action to avert possible broader threats that weaponized and misaligned AI may pose to national and economic security.⁴

According to the EY CEO Outlook Pulse survey

Against this backdrop, the US has been slowly regulating the technology. Policymakers — many of whom are still working to understand AI and its potential — have expressed a desire to develop rules that balance care quality and safety with approaches that incentivize innovation.

Executive actions

The federal government has been laying the groundwork to advance responsible AI adoption for years. This includes the establishment of various AI oversight bodies across the federal government, executive actions and strategic initiatives.

On October 30, 2023, President Biden unveiled a sweeping executive order (EO)⁷ that aims to develop a coordinated, all-of-government approach to overseeing the development and use of safe and responsible AI. On March 28, 2024, the Office of Management and Budget (OMB) issued a final memo⁸ establishing agency requirements and guidance for AI governance, innovation and risk management.

The EO's 8 guiding principles

Regulatory actions

Over the past several years, the Department of Health & Human Services (HHS) and other federal health agencies have ramped up their actions on AI, increasingly approving devices enabled by AI and machine learning (ML), creating a new digital advisory committee, and regulating the use of AI in medical necessity and algorithmic transparency. Spurred by President Biden’s recent EO and a growing industry and intra-agency imperative, HHS is expected to continue to consider AI in future rulemaking, guidance and enforcement.

Legislative activity

Lawmakers have begun taking the first steps on AI legislation, with stated goals of aiming to promote continued innovation while guarding against potential threats and the risk of overregulating. Congress has also expressed concern that “entrenched inequities and biased data may be baked into algorithms, further exacerbating health disparities and preventing under-resourced providers from accessing AI-enabled technologies.”⁹

Senate Majority Leader Chuck Schumer’s (D-NY) bipartisan working group on AI released a “bipartisan road map” for AI policy intended to help jump-start committee activity on AI legislation. Other groups are also advancing their own efforts to guide AI policy.

Explore our Offerings

Conclusion

As AI’s capabilities have continued to evolve and expand, the number of stakeholders that want a say in the development of guidelines regulating the technology has also increased. Even with this ever-growing list of interested parties, it is clear that Washington views itself as holding a key role in promoting AI innovation and protecting individual rights, while also promulgating fair and administrable rules.

 

What the final outcome will be remains to be seen as Washington moves past voluntary regulatory standards and toward legislative and regulatory requirements. The stakes for AI are especially high in the deeply personal realm of health care, where AI may present both serious risks and life-changing potential. Stay tuned to this site for additional insights as new developments emerge.


Key questions for policymakers as they consider AI oversight and policy

Download the report

Our latest thinking

Progress through policy: the digital health imperative

Explore how smart digital healthcare policy improves health equity, telehealth, EHR usage, nursing shortages, value based care, and patient centered care.

How enhancing outcomes with AI drives personalized care coordination

Learn how AI drives EY Care Coordination in enhancing patient outcomes, refining care and lowering readmissions.

Scott Leete

    EY health policy team

    Heather Meade

    Principal, Washington Council, Ernst & Young LLP
    WCEY health care principal, health & tax-exempt policy, former Congressional staffer, recovering ERISA attorney, coalition builder, teacher of civics and math through games. Sideline soccer fan.
    Washington, DC, USA

    Laura Dillon

    Senior Manager, Washington Council, Ernst & Young LLP
    Health policy wonk. Former health system best practice researcher, global and mental health advocate. Avid hiker, biker and wayfarer.
    Washington, DC, USA

    EY refers to the global organization, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients.