LONDON—Google is disbanding a panel here to review its artificial-intelligence work in health care, people familiar with the matter say, as disagreements about its effectiveness dogged one of the tech industry’s highest-profile efforts to govern itself.

The Alphabet Inc. unit is struggling with how best to set guidelines for its sometimes-sensitive work in AI—the ability for computers to replicate tasks that only humans could do in the past. It also highlights the challenges Silicon Valley faces in setting up self-governance...