CMS has unveiled the Wasteful and Inappropriate Service Reduction model, a new Innovation Center initiative that will add prior authorization for some traditional fee-for-service Medicare services.
Under the model, CMS will partner with companies specializing in AI and machine learning to test ways to provide an improved and expedited prior authorization process for certain Medicare services. Companies hired to manage the initiative will be paid based on how much money they save the federal government by stopping payment for unnecessary or non-covered items services.
The model is beginning with providers in Arizona, Washington, New Jersey, Texas and Oklahoma.
The 17 initial targeted services include those particularly vulnerable to fraud, waste and inappropriate use, according to CMS. They include deep brain stimulation for Parkinson’s Disease, epidural steroid injections for pain management, cervical fusion, skin and tissue substitutes and arthroscopy for knee osteoarthritis.
“The WISeR Model will help root out waste in original Medicare,” CMS Administrator Mehmet Oz, MD, said in a news release. “Combining the speed of technology and the experienced clinicians, this new model helps bring Medicare into the 21st century by testing a streamlined prior authorization process, while protecting Medicare beneficiaries from being given unnecessary and often costly procedures.”
The model comes amid wider reforms announced last week HHS and CMS that aim to reduce and streamline prior authorization processes across commercial, Medicare Advantage and managed Medicaid plans. Wasteful services can account for up to 25% of healthcare spending in the U.S., according to the agency, with Medicare spending as much as $5.8 billion on low-value care in 2022 alone.
Under WISeR, clinicians — not algorithms — will retain final authority to deny services that do not meet Medicare coverage criteria. Model participants will be incentivized based on their ability to reduce unnecessary services, lower Medicare spending, and improve the speed and experience of prior authorization for providers, suppliers and beneficiaries.
“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,” Abe Sutton, director of the CMS Innovation Center, said. “They also increase patient costs, while inflating healthcare spending.”
The model does not alter Medicare coverage or payment rules and will not impact emergency services or inpatient-only procedures, according to CMS, which has issued a request for applications for companies interested in participating. WISeR applies only to original Medicare and does not affect Medicare Advantage plans.
WISeR will run from Jan. 1, 2026 through Dec, 31, 2031.
