AI To Guide Use Of Prior Authorization In Medicare Through Demo Project

The Center for Medicare and Medicaid Innovation recently announced the launch of the Wasteful and Inappropriate Service Reduction (WISeR) Model in Medicare starting in 2026. This six-year demonstration project will allow for-profit contractors to utilize artificial intelligence tools to determine treatment protocols for elderly and certain disabled groups enrolled in traditional Medicare.

The WISeR model is based on a policy that has been successful in the privately run alternative to original Medicare, known as Medicare Advantage. While traditional Medicare uses prior authorization sparingly for outpatient services and durable medical equipment, Medicare Advantage plans rely heavily on prior authorization for a wide range of procedures and technologies. This often leads to delays in care and denials of certain treatments.

Critics of the WISeR model, including former Cigna executive Wendell Potter, have raised concerns about the potential impact on patient care and access to services. In response, six Democratic lawmakers have introduced legislation to block the implementation of the program.

Health insurers, including those offering Medicare Advantage plans, are increasingly turning to AI to assess the appropriateness and necessity of care for beneficiaries. They have pledged to improve pre-approval protocols for diagnostic tests, prescription medications, and procedures to streamline the process and ensure timely decisions.

While prior authorization can help ensure that treatments are appropriate and safe, there are concerns about the potential impact on patient care and outcomes. Plans may not save as much money as expected, as a significant number of prior authorization requests are overturned upon appeal.

Overall, the use of AI and prior authorization in healthcare has the potential to optimize the use of services and technologies. However, it is essential to strike a balance between cost-saving measures and ensuring that patients receive the care they need in a timely manner. With ongoing efforts to improve the prior authorization process, the goal is to create a more efficient and patient-friendly system that benefits both insurers and patients.

See also Eliminating Waste, Fraud, and Abuse in Medicaid My Administration has been relentlessly committed to rooting out waste, fraud, and abuse in Government programs to preserve and protect them for those who rely most on them. The Medicaid program was designed to be a program to compassionately provide taxpayer dollars to healthcare providers who offer care to the most vulnerable Americans. To keep payments reasonable, billable costs for such care were historically capped at the same level that healthcare providers could receive from Medicare. The State and Federal Governments jointly shared this cost burden to ensure those of lesser means did not go untreated. Under the Biden Administration, States and healthcare providers were permitted to game the system. For example, States "taxed" healthcare providers, but sent the same money back to them in the form of a "Medicaid payment," which automatically unlocked for healthcare providers an additional "burden-sharing" payment from the Federal Government. Through this gimmick, the State could avoid contributing money toward Medicaid services, meaning the State no longer had a reason to be prudent in the amount of reimbursement provided. Instead of paying Medicare rates, many States that utilize these arrangements now pay the same healthcare providers almost three times the Medicare amount, a practice encouraged by the Biden Administration. These State Directed Payments have rapidly accelerated, quadrupling in magnitude over the last 4 years and reaching $110 billion in 2024 alone. This trajectory threatens the Federal Treasury and Medicaid's long-term stability, and the imbalance between Medicaid and Medicare patients threatens to jeopardize access to care for our seniors. I pledged to protect and improve these important Government healthcare programs for those that rely on them. Seniors on Medicare and Medicaid recipients both deserve access to quality care in a system free from the fraud, waste, and abuse, that enriches the unscrupulous and jeopardizes the programs themselves. We will take action to continue to love and cherish the Medicare and Medicaid programs to ensure they are preserved for those who need them most. The Secretary of Health and Human Services shall therefore take appropriate action to eliminate waste, fraud, and abuse in Medicaid, including by ensuring Medicaid payments rates are not higher than Medicare, to the extent permitted by applicable law. This memorandum is not intended to, and does not, create any right or benefit, substantive or procedural, enforceable at law or in equity by any party against the United States, its departments, agencies, or entities, its officers, employees, or agents, or any other person. DONALD J. TRUMP