Health

On January 1, 2026, the Center for Medicare & Medicaid Innovation (CMMI) introduced the Wasteful and Inappropriate Service Reduction (WISeR) Model, implementing new prior authorization requirements within traditional Medicare. This initiative aims to evaluate the effectiveness of technologies, including artificial intelligence, in assessing the appropriateness of certain health services over a six-year trial period across six states: Arizona, New Jersey, Ohio, Oklahoma, Texas and Washington.

The WISeR model seeks to mitigate unnecessary or inappropriate health care utilization, a practice already commonplace in Medicare Advantage plans and other private insurers. However, this strategy raises concerns about potential delays and denials of essential medical care, which can create uncertainty for patients and additional administrative burdens for healthcare providers. Prior authorization is a feature of health insurance in the U.S., utilized as a mechanism to manage healthcare spending and utilization effectively.

Notably, recent surveys indicate that approximately 69% of insured U.S. Adults perceive prior authorization as a burden, with 34% identifying it as their biggest challenge in accessing healthcare, surpassing costs. The introduction of the WISeR model follows a 2025 announcement from the Trump administration, where many private insurers committed to reducing prior authorization requirements while streamlining the review process. However, an amendment to halt funding for the WISeR model was passed by the House Appropriations Committee in September 2025 but was not included in the Consolidated Appropriations Act of 2026.

Analyzing the Impact of the WISeR Model

The potential impact of the WISeR model is examined through an analysis of spending and utilization trends in traditional Medicare from 2019 to 2025. The analysis utilized 100% Medicare claims data from the Chronic Conditions Warehouse (CCW), focusing on services designated for prior authorization. The findings suggest that the immediate impact of the WISeR model may be limited, largely due to the small proportion of total Part B spending represented by WISeR services and the relatively low number of beneficiaries utilizing these services.

Key takeaways from the analysis include:

• WISeR services constituted 5.3% ($12.3 billion) of all Part B spending in traditional Medicare in 2024, a significant increase from 1.1% ($2.4 billion) in 2019.
• Skin substitutes accounted for 83% ($10.3 billion) of WISeR service spending in 2024, with expenditure on these services rising over 20-fold from 2019 ($509.6 million).
• The average price for skin substitutes surged by 820% from 2019 to 2024, escalating from $2,300 to $21,200, marking the highest increase among all WISeR service categories.

Prior Authorization: A Shift in Traditional Medicare

The WISeR model aims to leverage artificial intelligence to facilitate prior authorization for services considered vulnerable to fraud or misuse. CMS has collaborated with private health technology companies to manage these reviews, with vendors eligible for a share of savings from denied services. However, this model has faced scrutiny from healthcare providers and policymakers who worry that incentivizing denial may compromise patient access to necessary treatments.

Despite prior authorization being a rare practice in traditional Medicare, its prevalence in Medicare Advantage has led to increased scrutiny, particularly regarding delays and denials of medically necessary care. The model’s implementation has drawn attention due to investigations into several large insurers by Congress, stemming from inappropriate coverage denials associated with artificial intelligence tools that have elevated denial rates without adequate human oversight.

In 2026, the services that will require prior authorization under the WISeR model include:

• Skin substitutes used for treating severe or chronic wounds
• Orthopedic pain management services, such as cervical fusion and epidural steroid injections
• Electrical nerve stimulator implants
• Incontinence control devices
• Services related to diagnosing and treating impotence

Notably, two services initially slated for inclusion have been postponed, impacting less than 1% of total traditional Medicare spending.

Spending Patterns and Future Considerations

From 2019 to 2024, the spending on WISeR services saw a remarkable increase of approximately 400%, contrasting with a more modest 9.5% rise in overall Part B spending during the same period. Skin substitutes have significantly driven this growth, highlighting the model’s focus on managing specific high-cost services.

In 2024, nearly 1.1 million traditional Medicare beneficiaries received at least one WISeR service, with a significant majority (86%) utilizing orthopedic pain management services. However, a smaller fraction (9.3%) received skin substitutes, indicating that the majority of beneficiaries may encounter prior authorization requirements in contexts other than skin substitutes.

The variability in per capita spending on WISeR services among the model states ranged from $202 in Ohio to $748 in Oklahoma, influenced by local utilization rates and pricing structures. As the WISeR model progresses, questions remain regarding its capacity to effectively reduce wasteful service leverage while ensuring that beneficiaries are not adversely affected by delays or denials of care.

CMS has stated that health technology vendors will need to consult with human clinicians before denying prior authorization requests, with audits in place to ensure adherence to Medicare coverage criteria. While there are potential safeguards, concerns persist regarding the model’s financial incentives and the implications for patient care.

What’s Next for the WISeR Model?

As the WISeR model enters its initial year, the focus will be on its effectiveness in curbing unnecessary service use and managing overall spending. The outcomes of this model could lead to broader applications of prior authorization in traditional Medicare if deemed successful. Stakeholders will be monitoring how the model impacts both healthcare providers and beneficiaries, particularly in terms of access to necessary services and the administrative burdens introduced.

In light of these developments, it is crucial for patients to stay informed about potential changes in their coverage and for healthcare providers to adapt to the evolving regulatory landscape. The results of the WISeR model could shape the future of Medicare, reinforcing the importance of balancing cost management with the provision of timely and appropriate care.

This article serves as an informational overview and should not be taken as professional medical advice. Comments and shares are encouraged to further the conversation on this significant healthcare initiative.