Older but not Wiser

In June, the Centers for Medicare & Medicaid Services (CMS) announced a new six-year Innovation Center model called the Wasteful and Inappropriate Service Reduction (WISeR) Model. The model establishes new prior authorization or post-payment review requirements for a subset of items and services in Traditional Medicare. Oh joy--this oughta be as much fun as the RACs!!! CMS will partner with companies that have "experience managing prior authorization processes, including utilization management contractors or Medicare Advantage (MA) plans, to apply for model participation".

 WISeR will run for six performance years from January 1, 2026, to December 31, 2031, in six states: New Jersey, Ohio, Oklahoma, Texas, Arizona, and Washington. The application period opened on June 27, 2025.  

WISeR will test the use of technologies, including artificial intelligence (AI), for reviews on the designated services, beginning on January 1, 2026. The proposed initiative represents a significant departure from the lovely lack of PA for traditional Medicare. Prior authorization sometimes can be effective in reducing unnecessary, duplicate, harmful, and/or “low-value” care. Conversely, prior authorization can result in delays or denials of necessary and even lifesaving care.

Fortunately (maybe), providers and suppliers for people with Original Medicare in selected regions will have the choice of submitting a prior authorization request for the model’s selected items and services, or go through a post-service/pre-payment medical review. The model will target a specific subset of services thought to be wasteful, which includes but is not limited to:

• Stimulator services: Electrical nerve stimulators, sacral nerve stimulators for urinary incontinence, deep brain stimulators for Parkinson's disease and essential tremor, and phrenic nerve stimulators. 
• Skin and tissue substitutes: Especially those for non-healing wounds in the lower extremities. 
• Knee arthroscopy: Specifically for knee osteoarthritis. 
• Other services: Induced lesions of nerve tracts, epidural steroid injections for pain, percutaneous vertebral augmentation, cervical fusion, hypoglossal nerve stimulation, incontinence control devices, and diagnosis and treatment of impotence.

ALL stakeholders should follow this program closely because, if it saves any $$$, more services will be brought on board.

Beneficiary Protections and Appeals Rights

Medicare Advantage has a set of disclosure requirements and appeals rights to ensure that use of prior authorization by MA plans is managed in a way that protects plan enrollees. In 2023, 11.7 percent of care denials were appealed by MA enrollees. However, nearly 82 percent of appeals resulted in a favorable decision for the enrollee. 

For a “non-affirmed” prior authorization request — meaning that a future service was found not to meet Medicare coverage, coding or payment requirements — the provider/supplier has unlimited opportunities to resubmit a request. A non-affirmed decision does not prevent the provider/supplier from delivering the service and submitting a claim. Submission of such a claim and denial by the MAC will constitute an initial payment determination, which will be subject to the existing administrative appeals processes available to providers, suppliers, and individuals with Medicare. 

Potential for Provider Burdens Leading to Fewer Providers in Traditional Medicare

According to the AMA, more than 1 in 4 physicians (29%) report that PA has led to a serious adverse event for a patient in their care. Ninety percent of medical group practices reported that prior authorization was very burdensome—a contributing factor to increasing exits of providers and health systems from MA contracts. 

Policymakers and stakeholders should consider key factors to ensure that the WISeR model does not lead to greater provider frustration from administrative hassles: 

• Should decision timeframes required under the model mirror current MA requirements to provide decisions within 14 days for standard requests or 72 hours for expedited requests? Or should they be faster for patients who will suffer consequences of no treatment?
• Will AI be the only 'decider' for review decisions? What about second-level appeals--how will that be staffed?
• What paperwork will be required for providers targeted under the model? 
• Will prior authorization denials come with a specific reason, as required in MA?
• What happens if a provider bills a service while the claim is appealed?

Artificial Intelligence 

CMS announced that the WISeR Model will test what it refers to as 'enhanced technologies,' including AI, in proposed prior authorization decisions. MA plans have increasingly utilized AI models in prior authorization, with some plans arguing that AI serves as an aid in clinical decision-making and automates administrative tasks to reduce provider burdens. However, others contend that MA prior authorization decisions have been made solely by AI tools and decry a lack of transparency. 

Some reports have found that using AI can lead to high denial rates and exacerbate health disparities, as AI algorithms trained on data that reflects existing biases can perpetuate them.

We know that United has been nailed on its AI policies. Policymakers and stakeholders should consider key issues to ensure that so-called enhanced technologies and AI under the WISeR model are not misused:

• Will there be adequate guardrails on the use of AI to make decisions? 
• How will CMS ensure that the underlying AI algorithms used in the model ensure equitable coverage and consider beneficiaries’ individual circumstances, such as comorbidities, social circumstances, and prior history related to their diagnosis?
• How will CMS ensure that the AI algorithms used in the model are transparent for beneficiaries and stakeholders, like claims edits and audit criteria?

Conclusion

Transparency may be one way CMS could alleviate these issues, including by publicly reporting prior authorization metrics under the program, similar to the requirements in MA, as well as publishing the list of model review participants.

Additionally, in late July, Reps. Alexandria Ocasio-Cortez (NY-14) and Lloyd Doggett (TX-37), along with 40 colleagues, sent a letter to CMS urging the agency to halt implementation of the WISeR model. The letter acknowledged the cost-saving intentions of the model, but vocalized concern over the use of for-profit companies as model contractors and lessons learned from the inappropriate use of prior authorization in MA.

CMS has released WISeR Frequently Asked Questions available here.