Medicare’s New Pilot Programs

Medicare is set to introduce new pilot initiatives that will involve prior authorization for 17 medical services, utilizing artificial intelligence tools.

The Wasted and Inappropriate Services Reduction (WISeR) model is scheduled to start next year in six states. This program mandates healthcare providers to obtain Medicare approval prior to patients receiving a range of specific services.

Why It’s Important

Nearly 70 million seniors use Medicare for their health coverage. Traditionally, the program didn’t require prior authorization, but the Centers for Medicare and Medicaid Services (CMS) are changing that with this new pilot, which will cover 17 services.

What You Need to Know

The WISeR pilot program will require prior approval for a variety of procedures, including:

• Electrical nerve stimulator
• Sacral nerve stimulation for urinary incontinence
• Phrenic nerve stimulator
• Deep brain stimulation for essential tremor and Parkinson’s disease
• Vagus nerve stimulation
• Surgically induced nerve tract lesions
• Hypoglossal nerve stimulation for treating obstructive sleep apnea
• Epidural steroid injections for pain management
• Percutaneous spinal augmentation
• Cervicopexy
• Arthroscopic irrigation and debridement of the knee
• Incontinence control device
• Diagnosis and treatment of impotence
• Percutaneous lumbar decompression for spinal stenosis
• Skin and tissue substitutes
• Application of biotechnological skin substitutes to non-healing wounds
• Wound application of cell/tissue-based products

The pilot is expected to last six years, beginning January 1, 2026, for traditional Medicare beneficiaries in Arizona, New Jersey, Ohio, Oklahoma, Texas, and Washington.

According to CMS, this initiative aims to safeguard American taxpayers by assisting patients and healthcare providers in avoiding unnecessary or inappropriate care.

Currently, over 6.4 million people in these states rely on traditional Medicare, as noted by consulting firm McDermott+.

While ultimate coverage approval lies with Medicare staff, the introduction of AI in the review process has drawn criticism. One major concern is that companies conducting these reviews could be incentivized to deny coverage in their pursuit of cost reduction.

Kevin Thompson, CEO of 9i Capital Group, emphasizes that the ramifications for older adults could be significant, particularly in urgent care situations. He previously discussed this topic on the 9 innings Podcast.

“The current administration is keen to root out waste, fraud, and abuse,” he said. “This effort may lead to more complexities in the approval process, potentially increasing denial rates.”

People’s Opinions

Abe Sutton, director of the Center for Innovation at CMS, stated: “Low-value services identified in WISeR offer little benefit to patients and can sometimes lead to physical harm or psychological stress, alongside inflated costs for healthcare and patients.”

CMS Administrator Dr. Mehmet Oz remarked: “CMS is dedicated to eradicating fraud, waste, and abuse. The WISeR model aims to eliminate waste in Original Medicare. By merging technology with clinical expertise, we hope to modernize Medicare and streamline the prior authorization process, protecting beneficiaries from unnecessary and costly treatments.”

Financial literacy instructor Alex Bean at the University of Tennessee at Martin shared: “When prior authorization was first mentioned, it understandably raised concerns among beneficiaries about heightened difficulties in accessing services. However, the clarification that this will be part of a limited six-year pilot program in specific states, focused on 17 services deemed less necessary, might offer some reassurance.”

What Happens Next

While some operational details of the pilot program remain vague, there’s a general unease regarding the involvement of AI in decision-making.

“Aspects like how the programs will function in states, such as Ohio and Texas, and how frequently approval will be needed for these services are still unclear,” Bean mentioned. “As with any changes, it’s crucial for recipients to stay informed about the timelines for implementation.”

A 2024 Senate committee report noted that AI tools are linked to a 16-fold increase in care denials compared to decisions made without this technology.