According to Forbes, the Center for Medicare and Medicaid Innovation (CMMI) announced the Wasteful and Inappropriate Service Reduction (WISeR) Model last month. This six-year demonstration project will start in January 2026 in six states: New Jersey, Ohio, Oklahoma, Texas, Arizona, and Washington. For-profit contractors will use artificial intelligence tools to decide on treatment protocols for elderly and disabled patients in traditional Medicare. Crucially, these vendors will earn a share of “averted expenditures,” which critics argue means they get paid for denying care. The plan is already under fire, with six Democratic lawmakers introducing the “Seniors Deserve SMARTER Care Act” to block it. This move brings a common practice from Medicare Advantage—where over half of seniors are enrolled—into the traditional Medicare system for the first time.
Why This Is A Big Deal
Here’s the thing: traditional Medicare has been the last bastion of relatively hassle-free care for seniors. It only uses prior authorization for 52 specific outpatient services, some equipment, and ambulance rides. Medicare Advantage plans, on the other hand, use it for thousands of procedures. This demo project is basically importing a privatized, profit-driven model into the public system. And the financial incentive is what really stings. Paying contractors based on “averted expenditures” creates a direct conflict of interest. It’s like putting a bounty on saying “no.”
Now, CMS says this will “protect taxpayers” and “streamline” the process with a mix of AI and human review. But look at the track record in Medicare Advantage. An OIG report found plans were incorrectly denying care that should have been covered. And in 2021, a staggering 82% of prior authorization denials by Medicare Advantage plans were overturned on appeal. So, how much “waste” is actually being reduced, versus how much legitimate care is being blocked with a hope that patients won’t fight back?
The AI Promise Versus Reality
The industry is selling AI as the fix for a broken prior authorization system. Insurers have even made pledges to HHS to improve things, promising faster, standardized decisions. CMS Administrator Mehmet Oz basically told them, “Either you fix it, or we’ll fix it.” But is AI really the solution, or just a faster, more opaque way to say no?
Wendell Potter, a former Cigna exec turned critic, wrote a scathing critique of the WISeR model, warning of delays and denials. And he would know. The fear is that algorithms, trained on historical data that may already reflect restrictive practices, will simply automate inequities and barriers. Patients can already get stuck in “prior authorization purgatory” while their health deteriorates. A faster denial is still a denial.
The Political Battle Ahead
This is setting up a major political fight. The Democratic bill to block WISeR is just one side of it. There’s actually rare bipartisan agreement that prior authorization in Medicare Advantage needs reform. Bills like the Seniors’ Timely Access to Care Act and the SMART Act aim to standardize the process and force more transparency. They want to know *why* a treatment is denied and mandate clear timelines.
But here’s the kicker: even if those bills pass, they target Medicare Advantage. The WISeR demo is about bringing these tools *into traditional Medicare*. So we could end up in a weird spot where Congress is tightening rules for private plans while the administration is loosening them for the public option. It’s a huge philosophical shift, treating government beneficiaries more like managed care customers.
The Bottom Line For Patients
In a perfect world, prior authorization makes sense. It can flag dangerous drug interactions or ensure a pricey biologic goes to a patient who will actually benefit. But that’s not the world we live in. The system is overwhelmingly used as a cost-control tool, not a safety tool.
For seniors in traditional Medicare, this demo could mean a fundamental change in their healthcare experience. The freedom to see any doctor who accepts Medicare could be undermined if that doctor’s recommended treatment is blocked by an AI used by a for-profit middleman. The promise is efficiency and savings. The very real risk, as we’ve seen for years in the private market, is delayed care, administrative nightmares, and worse health outcomes. The experiment starts in 2026, but the fight over it is already here.
