Dive Brief:
The CMS will test a new model beginning next year that adds prior authorization requirements to some Medicare services that the government says are prone to abuse. The initiative is part of the agency’s ongoing effort to root out what it says is waste, fraud and abuse in healthcare spending.
The model, Wasteful and Inappropriate Service Reduction, or WISeR, will leverage enhanced technologies, including AI, to expedite prior authorization processes for services including skin and tissue substitutes, electrical nerve stimulator implants, and knee arthroscopy for knee osteoarthritis, according to a Friday news release.
In a statement, CMS Administrator Dr. Mehmet Oz said the program is designed to protect Medicare beneficiaries from receiving “unnecessary and often costly procedures.” CMS estimates waste drives up to 25% of healthcare spending nationwide, while prescribing low-value services cost Medicare up to $5.8 billion in 2022.
Dive Insight:
The Center for Medicare and Medicaid Innovation will oversee WISeR, which will run for six years, between Jan. 1, 2026, and Dec. 31, 2031.
The goal of the program is to prevent providers from prescribing medically unnecessary care and cut costs, according to CMMI Director Abe Sutton.
“Low-value services, such as those of focus in WISeR, offer patients minimal benefit and, in some cases, can result in physical harm and psychological stress,” said Sutton in a statement. “They also increase patient costs, while inflating health care spending.”
Still, any care denial will have to be reviewed by a licensed clinician, according to a fact sheet about the model. Time-sensitive care, including inpatient-only services, emergency services and services “that would pose a substantial risk to patients if delayed” are excluded from the model, according to the CMS. The program also only applies to beneficiaries enrolled in traditional Medicare, not Medicare Advantage.
CMS is currently soliciting applications from technology companies who have experience managing the prior authorization process for other payers to help expedite claims processing for WISeR.
The government hopes the technologists’ solutions streamline medical review of services, reduce inappropriate utilization, lower Medicare spending and ease provider administrative burden.
WISeR’s unveiling comes just days after the Trump administration and health insurers made a dual commitment to reform prior authorization processes amid growing criticism from patients and providers, who say onerous administrative hoops lead to long wait times for care and significant extra hours of work for doctors fighting for approval.
Almost 50 health insurers, including UnitedHealthcare, Aetna, Cigna, Elevance and Humana, have pledged to reduce the number of claims subject to prior authorization by next year as a result.
