California leads the way: AI in Healthcare and What It Means for Your Practice

In a recent executive order, California Governor Gavin Newsom addresses the growing role of artificial intelligence in various industries, including healthcare. The order mandates risk assessments and ethical guidelines and calls for legislative action. Let’s review the order’s key elements and a 10-step action plan for businesses.

Newsom’s order directs California agencies on generative AI analysis, societal, economic, energy impact, ethical, and risk guidelines. The 10-step plan advises AI audits, stakeholder committees, legal advice, training, data protection, procurement, pilot testing, and regulatory monitoring. 

This executive order could pave the way for AI enterprises, including those that develop chatbots, to generate revenue. By encouraging state agencies to adopt AI technologies, the order could create a market for these products, thereby providing a revenue stream for companies in this sector.

The actions taken by California could serve as a model for other states or even countries. If the state successfully integrates AI into its operations ethically and effectively, other jurisdictions may follow suit, adopting similar policies and regulations.

The executive order calls for thorough studies and risk assessments concerning the impact of AI. These reports are expected to be comprehensive, covering various sectors and aspects of life, from the economy to ethical considerations. The findings’ influence could extend beyond California to set a standard for AI governance nationwide.

The order also anticipates the formulation of new policies and regulations by legislative bodies. These new laws could provide a legal framework for AI’s ethical and practical use, affecting various sectors, including healthcare, financial services, and more.

Given the focus on ethical and practical implications of artificial intelligence (AI) in Governor Newsom’s executive order, healthcare organizations should consider the following measures to align with potential new regulations and ethical guidelines:

Conduct an AI Ethics and Risk Assessment: Similar to state agencies, healthcare organizations should conduct a comprehensive risk assessment focused on the ethical implications of AI in healthcare, such as diagnostic AI, patient data management, and telemedicine.

Establish an AI Governance Committee: Create a multidisciplinary committee comprising members from clinical, IT, legal, and ethics departments to oversee AI adoption and ensure compliance with state and federal laws.

Enhance Data Security Protocols: Given the sensitive nature of healthcare data, robust data protection measures should be in place, especially when integrating AI algorithms that require large datasets.

AI Skill Development: Train healthcare professionals in understanding the capabilities and limitations of AI. This could range from understanding AI-driven diagnostic tools to data privacy concerns.

Engage Legal Expertise: Consult with legal teams to understand how future AI-related laws might impact healthcare operations, especially concerning patient data and ethical considerations.

Ethical AI Procurement: Review and update procurement policies to ensure that any AI tools or services procured align with ethical guidelines and potential upcoming regulatory standards.

Implement Pilot Programs: Before full-scale implementation, run pilot tests on AI applications in a controlled environment, such as AI-driven diagnostic tools or administrative bots, to identify any potential issues.

Stay Updated on Regulatory Changes: Keep abreast of any updates in California’s AI legislative environment, as healthcare is a highly regulated sector. Adapt policies and practices accordingly.

Maintain Transparency: Ensure that the AI decision-making process is transparent and can be audited for ethical and legal compliance.

Patient Consent and Education: Educate patients about how AI is used in their healthcare and obtain informed consent when AI is involved in diagnostic or treatment decisions.

Governor Newsom’s executive order propels California to the forefront of responsibly integrating artificial intelligence (AI) across various fields, including healthcare. This initiative emphasizes a balanced approach to AI deployment, focusing on enhancing healthcare efficiency and patient care quality while ensuring robust data security. The action plan for healthcare organizations to align with expected ethical and regulatory frameworks showcases California’s anticipatory and strategic posture. This alignment promises to not only advance patient services but also establish a compliance model for the forthcoming AI era, stressing the importance of safety, privacy, and ethical practices.

California’s leadership could set a benchmark for global AI adoption, inspiring innovation that marries ethical integrity with legislative support. This vision for AI in healthcare suggests a future where technology significantly bolsters care delivery, highlighting the pivotal role of ethical diligence and regulatory adaptability in navigating AI’s healthcare potential.

Is artificial intelligence a good fit for your organization, and do you have the resources to meet the challenges defined by Gov. Newson’s executive order? Xpio Health works with organizations to coordinate change and manage projects that get tangled at the intersection of innovation and compliance. Contact us at or visit to learn more.