A sweeping new federal pilot will soon test whether artificial intelligence can help Medicare cut costs by denying claims for some medical services.
The program is set to begin next year in six states, where it will affect the lives of Medicare patients and the medical staff who care for them.
The initiative relies on a type of review usually associated with private insurance, known as prior authorization, which forces the patient or their doctors to get advanced approval from the government before they proceed with certain procedures or prescriptions.
For many, the plan comes as a surprise. Traditional Medicare rarely used prior authorization compared to private insurers, who have long leaned on it as a cost-saving measure, especially in the Medicare Advantage arena.
Some say the timing is odd, given that just days before this pilot was announced, the Trump administration had touted a voluntary plan to help private insurers ease their own reliance on prior authorization.
Oz, the current head of the Centers for Medicare and Medicaid Services, did not mince words, explaining, “It erodes public trust in the health care system. It’s something that we can’t tolerate in this administration.”
However, critics have flagged what they view as mixed signals from the federal government: on one hand, embracing the private sector’s strategies, and on the other, calling out those same companies for aggressive use of prior authorization.
Representative Suzan DelBene from Washington argued, “Administration officials are talking out of both sides of their mouth. It’s hugely concerning.”
Doctors and patients remain wary of delay tactics that can slow or even block vital medical care. The process has a reputation for causing potentially grave harm, a stance echoed nationwide.
Insurers counter that prior authorization curbs unnecessary spending and fraud.
A recent survey by a prominent health policy group found that nearly three-quarters of Americans believe it is a significant problem.
How WISeR Will Work
The new federal pilot, dubbed WISeR, for Wasteful and Inappropriate Service Reduction, will test whether an AI-driven system for Medicare prior authorization can spot unneeded medical treatments and services before they occur.
Beginning in January, the program will first target service requests involving knee procedures, electrical nerve implants and skin grafts in Arizona, Ohio, Oklahoma, New Jersey, Texas, and Washington.
Officials claim only services vulnerable to abuse will be subject to the AI review. Urgent and inpatient treatments will not go through this algorithmic filter.
Government representatives insist a human expert will review all denied requests and that AI vendors cannot tie their pay to the number of denied claims. “Vendors financially benefit when less care is delivered,” warned Jennifer Brackeen of the Washington State Hospital Association.
AI offers the hope of making a once-arduous process more streamlined, but skeptics say real oversight is lacking and the safeguards are unclear.
Critics like Dr. Vinay Rathi at Ohio State say the rules are vague and the results hard to measure. “I’m not sure they know, even, how they’re going to figure out whether this is helping or hurting patients,” he said.
Physicians warn that the more expensive a care request, the more likely it is to be denied, pushing the most vulnerable patients into appeals that can drag on as their conditions worsen.
Both Republican and Democratic lawmakers are demanding answers and have even proposed blocking the pilot’s funding in the next budget.
AI in health care may be inevitable, but how far it will shape medical coverage decision-making for Medicare patients is uncertain.
