CMS to Test AI-Driven Prior Authorization in Medicare Under WISeR Model

The CMS Innovation Center is launching the Wasteful and Inappropriate Service Reduction (WISeR) model, which introduces prior authorization processes to Traditional Medicare using AI technology. This model targets specific services vulnerable to fraud, waste, and abuse, including skin and tissue substitutes, electrical nerve stimulators, and knee arthroscopy for osteoarthritis. Critical services such as inpatient-only, emergency, and those where delay poses substantial patient risk are excluded from the program.

WISeR’s review process combines AI recommendations with clinical determinations made by licensed clinicians applying standardized, evidence-based criteria. The model is voluntary and is set to run from 2026 through 2031, initially focusing on a limited scope of providers and services before potential expansion.

A legal analysis highlights challenges for providers, including a shared savings structure that pays contractors partly based on cost savings from denied services. This approach parallels previous programs like the Recovery Audit Contractor (RAC) and Unified Program Integrity Contractor (UPIC) models, which faced criticism for aggressive denials and administrative burdens.

Providers may encounter increased billing complexities and oversight layers, necessitating changes in revenue cycle management, enhanced staff training, and close monitoring of denial trends. Financially, providers with significant volumes of the targeted procedures face exposure to potential payment reductions.

Overall, WISeR introduces a complex interplay of AI-driven prior authorization and clinical oversight within Medicare, aiming to reduce inappropriate services while raising operational and financial considerations for healthcare organizations.