Legislation Detail

Adds Business & Commerce Code Subtitle D (Chs. 551-554). Health care providers must disclose to patients or their representatives their use of AI systems in diagnosis or treatment, before or at the time of interaction (as soon as reasonably possible in emergencies). Prohibits developing or deploying AI with the specific intent to discriminate against protected classes (disparate impact alone is insufficient), restricts government use of biometric identification (with a HIPAA treatment/payment/operations carve-out), and creates an AI regulatory sandbox.

State agencies, developers and deployers of AI systems, and health care providers

Attorney General exclusive enforcement with a 60-day cure period; civil penalties; no private right of action (per Holland & Knight analysis)

Manatt notes there has been no publicly reported activity in the Texas sandbox. In June 2026 Texas also proposed a rule restricting behavior analysts' use of AI (https://www.sos.texas.gov/texreg/archive/June192026/Proposed%20Rules/16.ECONOMIC%20REGULATION.html) — a proposed rule, not an enacted law.