KY HB641

Prohibits suppliers of mental health chatbots from selling or sharing users' individually identifiable health information or user input with third parties, with exceptions for health care provider requests with consent and functionality-related sharing under HIPAA-compliant contracts.

Bans using mental health chatbots to deliver targeted advertising based on user input, and requires any advertisements within chatbot conversations to be clearly labeled with disclosure of sponsorships or business affiliations.

Requires mental health chatbots to clearly disclose they are AI systems (not humans) before access, after 7-day gaps in use, every 30 minutes during interactions, and whenever users ask about AI involvement.

Creates an affirmative defense for suppliers who file written policies with the Attorney General detailing development practices, licensed therapist involvement, safety testing protocols, harm reporting mechanisms, and HIPAA-compliant privacy measures.

Authorizes the Attorney General to impose administrative fines up to $2,500 per violation and courts may impose civil penalties up to $5,000 per violation of administrative or court orders, with collected funds deposited into the consumer privacy fund.