CMS looks for AI experts, physicians and other clinicians to streamline prior authorizations

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Streamlining prior authorizations (PAs) with artificial intelligence (AI) will improve care for traditional Medicare beneficiaries while saving money, according to plans for a new model announced by the U.S. Centers for Medicare & Medicaid Services (CMS).

The new model follows an announcement by CMS leaders to work with health insurers on sweeping reforms to the PA process that has delayed care, consuming vast amounts of time of physicians and other clinicians pursuing approvals before delivering treatments. However, at least one health care business group expressed concerns the new model could add to administrative burdens already heavy for doctors and their staff.

CMS plans he Wasteful and Inappropriate Service Reduction (WISeR) Model to run in six states for six years starting in 2026. CMS will partner with companies willing to use “enhanced technologies” to expedite prior authorizations under traditional Medicare. The goal is to help patients and physicians and other clinicians avoid unnecessary or inappropriate care while saving taxpayer money.

Crushing waste

“CMS is committed to crushing fraud, waste, and abuse, and the WISeR Model will help root out waste in Original Medicare,” CMS Administrator Mehmet Oz, MD, MBA, 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.”

Oz and CMS Innovation Center Director Abe Sutton said the wasteful care, with little to no clinical benefit, tallies up to 25% of all U.S. health care spending. For Medicare, that totaled $5.8 billion for 2022, they said, citing the Medicare Payment Advisory Commission (MedPAC).

“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,” Sutton said in the news release. “They also increase patient costs, while inflating health care spending.”

There is a human cost as well. A 2019 study of Medicare claims data estimated up to 6,700 traditional Medicare beneficiaries suffered premature deaths due to treatment by health care providers subsequently prosecuted for fraud or abuse, according to the WISeR plan outline published in the Federal Register. A model summary published online noted inappropriate care can create physical risk of complications, such as infection, and psychological risk, such as patient anxiety over tests and procedures.

Streamlining PAs

The announcement came days after Oz, Health and Human Service Secretary Robert F. Kennedy, Jr., and other health care leaders on June 23 announced a new federal-industry initiative to improve prior authorizations across health care.

Pledged goals include reducing the volume of medical services subject to prior authorization by the start of 2026, and honoring existing authorizations during insurance transitions to ensure continuity of care. Real-time responses and approvals for most requests are expected by 2027.

That move has been praised by health care advocates, though several organizations have stated their leaders are hopeful, but skeptical, because PA remains a significant administrative burden for physicians, despite previous health insurance company pledges.

A solution or part of the problem?

Tackling waste, fraud and abuse in Medicare fee-for-service (FFS) is commendable, said Anders Gilberg, senior vice president, government affairs for the Medical Group Management Association (MGMA).

However, it appeared the new WISeR model could expand the use of prior authorization for certain services, not reduce it, Gilberg said in a statement.

"Prior authorization continually ranks as the number one administrative burden facing medical groups, and one of the hallmarks of traditional Medicare has been the ability for physicians, not government, to determine what’s clinically appropriate for their patients,” Gilberg said.

On June 23, “HHS and CMS announced an industry pledge from health plans to reduce the volume of medical services subject to prior authorization and additional measures meant to alleviate this significant burden,” Gilberg said. “Through MGMA advocacy efforts, we've seen several CMS rules finalized to reduce prior authorization burden in Medicare Advantage and increase transparency.

“The announcement of this Part B model seems to contradict the administration's recent commitments to ease the burden of prior authorization,” he said. “We look forward to working with CMMI and the administration on efforts to reduce waste and ensure they do not come at the cost of greater administrative burdens and interference with clinical decision-making."

WISeR model

The WISeR model will operate in New Jersey, Ohio, Oklahoma, Texas, Arizona, and Washington, for six performance years running Jan. 1, 2026, to Dec. 31, 2031. It will apply only for traditional Medicare, also known as Medicare fee-for-service (FFS), not Medicare Advantage plans.

“Under the model, participants will implement and streamline prior authorizations to ensure that select services that are provided and paid for are clinically appropriate, evidence-based, and consistent with Medicare FFS requirements,” the Federal Register summary said. “We envision that implementing the review process while leveraging enhanced technologies would identify when such services are medically unnecessary, that model participants will support providers and suppliers in navigating beneficiaries towards more clinically appropriate or higher value care when appropriate and will streamline the prior authorization process for providers and suppliers.”

Relevant procedures

The model will involve the PA process for 15 items and services involving care such as nerve stimulation, steroid injections for pain management, and treatments for osteoarthritic knees, sleep apnea, incontinence, impotence, spinal stenosis and wounds.

“Health care coverage for people with Medicare will not change, and they retain the freedom to seek care from their Original Medicare provider or supplier of choice,” the model summary said. “Payment to providers and suppliers for covered items and services will not change under the model.”

Providers involved

On June 27, CMS opened the application period that runs until July 25.

Participating providers will have expertise in enhanced technologies, such as AI, and clinicians to conduct medical reviews and validate determinations.

“Model participants will receive a percentage of the savings associated with averted wasteful, inappropriate care as a result of their reviews,” the model summary said. “That percentage will be adjusted based on the participant’s performance on measures related to the process, including provider experience.”

CMS will use surveys about the ease of prior authorizations to assess how participants improve the provider and supplier experience. Those with demonstrated records of compliance may get “gold card” exemptions from the WISeR review process to reduce administrative burdens while focusing on reducing unnecessary care.