California awaits governor's action on AI practice bills; WISeR vendor under corrective plan; 72% of health systems report unsanctioned AI; Conifer cuts 1,037 billing jobs
THE SHORT READ
California's governor has until Sept. 30 to act on Assembly Bill 1979, which would bar artificial intelligence (AI) from independently performing work that requires a licensed professional or directing unlicensed staff to do it. The bill applies to health facilities, clinics and physician offices; under its terms, an AI system could not direct medical assistants or other unlicensed personnel to carry out licensed duties. Its companion, AB 2575, would protect clinicians who override an AI system and bar developers from blaming those clinicians when the system fails.
The WISeR records, the Waystar sale process and the ACCESS expansion had been covered in the baseline report. The fuller WISeR records show one vendor under a corrective action plan and a Centers for Medicare & Medicaid Services (CMS) plan that considered extending AI prior authorization to MRI, cancer treatment and air ambulance, according to Fierce Healthcare and the Electronic Frontier Foundation (EFF). An Imprivata survey of 250 health system leaders found 72% have AI tools deployed without formal IT approval. Tenet's billing subsidiary is cutting 1,037 jobs, Healthcare Dive reported, and Tenet's chief executive has pointed to AI and offshoring. Waystar has hired Evercore to explore a sale, Reuters reported.
THE DETAILS
- Regulation Sept 10, 2026AB 1979 (Bonta) would prohibit health facilities, clinics and physician offices from allowing AI to independently perform clinical functions that require a licensed professional or to direct unlicensed personnel to carry out licensed duties; AI could inform a decision if a licensed professional keeps final authority, and documentation, routine communications and supervised education are exempt. It would also make direct-to-consumer health chatbots that handle medical records subject to California's medical confidentiality law. AB 2575 (Ortega) would protect clinicians who override unsafe AI output and bar developers from shifting blame for AI-caused harm onto the workers using it. Both bills cleared the Legislature by Aug. 31 with the California Nurses Association as sponsor and hospitals, insurers and technology firms opposed; enforcement would run through the licensing boards, effective Jan. 1, 2027, if signed.
- Regulation Sept 15, 2026Roughly 1,000 pages of WISeR records, won by EFF in a Freedom of Information Act suit, show Virtix denied more requests than it approved in its first three months and was required to submit a corrective action plan, Fierce Healthcare reported, adding detail to earlier STAT coverage. The records also show that Innovaccer told CMS before launch it needed more time and was still working backlogs in early April, that vendors and Medicare contractors miscommunicated and mis-categorized requests, and that low quality scores cut vendor pay by 5% to 10%. EFF's write-up said the Innovation Center's June 2025 investment plan considered adding services that need urgent authorization, including air ambulance, cancer treatment, MRI and medications without public coverage criteria. The CMS WISeR page, updated Sept. 10, lists the original service categories and no expansion. CMS has not responded to the records.
- Deployment Sept 15, 2026The Sept. 15 Imprivata survey of 250 health system leaders responsible for identity security or AI strategy found 83% have AI across multiple departments, 28% have agentic AI in production and 44% are piloting it. It also found 79% expect agents to change clinical workflows significantly, 88% expect agents to act with some autonomy and 17% consider their current identity controls adequate. Imprivata sells identity management software, and the figures are the company's own. Advocate Health and Penn Medicine leaders described the same pattern of unapproved AI use at Becker's Health IT conference the same day.Sources: GlobeNewswire, Fierce Healthcare
- Deployment Sept 14, 2026Advocate Health paused an ambient voice documentation rollout for nurses after finding that little inpatient nursing care is done by voice, Dr. Bobbie Byrne, the system's chief information officer, said at Becker's Health IT conference in Chicago; nurses chart in structured flowsheets, not narrative notes. Byrne also said AI raises the cost of health care in total, not for any one organization. Dr. Mitchell Schnall of Penn Medicine cited roughly 30% efficiency gains in pharmacy prior authorizations and said jobs change and the system commits to retraining rather than guaranteeing roles. Mayo Clinic said its Abridge-built nursing tool has made documentation latency an obsolete metric. Mercy, FMOL, Northeast Georgia, Mount Sinai Miami Beach, Jefferson and Northwell are running or planning nursing ambient documentation, and Mercy reported 22% less flowsheet time per shift on three pilot units.Source: Becker's Hospital Review
- Deployment Sept 15, 2026Knowtex, which won a $15 million Department of Veterans Affairs (VA) contract in October 2025 after the VA's ambient-scribe tech sprint evaluated more than 150 tools, said it is live at 79 VA medical centers across 10 Veterans Integrated Service Networks within six months, with 88% sustained clinician adoption, 450,000 documentation hours saved and more than 300 customer organizations. The new lab will build specialty-specific models and evaluation benchmarks, the company said. All figures are the company's own. The VA is the largest single employer of physicians in the country.Sources: PR Newswire, Fierce Healthcare
- Workforce Sept 14, 2026Conifer Health Solutions, Tenet's revenue-cycle subsidiary with more than 600 clients, will lay off 1,037 mostly remote workers effective Nov. 2, 2026, Healthcare Dive reported. The stated trigger is CommonSpirit's exit from its 24% stake and its service contract, which ends Oct. 30. Tenet's chief executive has said AI and offshoring would lower Conifer's costs, and the Worker Adjustment and Retraining Notification (WARN) filing cites restructuring and technology initiatives. The jobs are back-office, not clinical. No verified case of a U.S. health system cutting physician positions because of AI has been reported.Source: Healthcare Dive
- Evidence Sept 11, 2026Becker's Hospital Review asked chief information officers and chief medical information officers at Cornell, Baptist Health, HSS, Premier Health, Christ Hospital, North Country Healthcare and Denver Health what the ADVOCATE agents of the Advanced Research Projects Agency for Health (ARPA-H) would need. Dr. Curtis Cole of Cornell said the agents will not succeed if the companies that build and oversee them have no liability. Joy Oh of Christ Hospital asked who is responsible when a supervisory agent misses an inappropriate recommendation, and Dr. Daniel Kortsch of Denver Health said the technology has been tested on curated cases, not safety-net populations. The consensus was narrow use cases, named accountability and escalation paths, not broad autonomy.Source: Becker's Hospital Review
- Incident Sept 15, 2026Plaintiffs' firms are soliciting lead plaintiffs, with a Nov. 2, 2026, deadline, for a securities suit alleging Hims & Hers misled investors while providing customer health data to third-party advertising platforms and running treatment practices likely to draw regulatory scrutiny, SBS Law said in a notice on GlobeNewswire. Hims & Hers is a publicly traded direct-to-consumer health company. The notice is a law firm solicitation, not a court ruling, and the complaint's allegations have not been tested in court.Source: GlobeNewswire (SBS Law notice)
- Money Sept 15, 2026Waystar, a revenue-cycle software company used by hospitals and physician groups for billing and claims, has retained Evercore to run a sale process that is at an early stage and could still stall, Reuters reported. Shares are down 24% this year after a July Morgan Stanley note argued AI could disrupt software companies. EQT holds 13% of the company, CPP Investments 10% and BlackRock 8%. Waystar went public at $20 a share in 2024 and peaked at $45 in 2025. The company has said AI drives 40% of its bookings.