The Centers for Medicare & Medicaid Services (CMS) rolled out an Innovation Center model Friday to test new prior authorization requirements in traditional Medicare.
Called Wasteful and Inappropriate Service Reduction (WISeR), the model comes just days after the CMS boosted and endorsed industrywide commitment to alleviate prior auth burden in commercial insurance. While that announcement is supposed to reduce prior auth, this model adds a new process to traditional Medicare.
It’s expected the agency will continue its broad push to modernize efforts through “enhanced technologies,” the CMS 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,” said CMS Administrator Mehmet Oz, M.D., in a statement.
Model participants must include clinicians to complete medical reviews and confirm coverage determinations. Final decisions are made by healthcare professionals, the CMS assured. It will launch Jan. 1 and conclude at the end of 2031.
WISeR participants will use artificial intelligence to expedite prior auth for certain services deemed “vulnerable” to waste, fraud and abuse. This includes skin and tissue substitutes, a growing target of federal investigators. Most notably, two Arizona business owners pleaded guilty for submitting false and fraudulent claims to Medicare for wound grafts for elderly and terminally ill patients, the Department of Justice said. President Donald Trump has taken an interest in this industry.
In March, Trump posted a graphic on his Truth Social account, saying a President Joe Biden-era proposed policy would “create more suffering and death for diabetic patients on Medicare.” The graphic attributed claims to the CMS, the Journal of Wound Care and the National Institutes of Health.
The Biden administration said the rule would limit coverage for many unproven and expensive products that exploit loopholes in the federal health program. But Biden’s policy, said Trump, would lead to fewer skin substitute products on the market and worse health outcomes. Industry insiders speculated to Clear Health Costs that wound care companies likely were able to persuade Trump to rein in the regulation.
A month later, Trump delayed implementation of the local coverage determination. A super PAC for Trump received a $2 million donation from a top skin substitutes company, The New York Times reported.
An annual federal review of healthcare fraud recovery dedicated an entire section to fraudulent wound care June 30.
The CMS also name-checked electrical nerve stimulator implants and knee arthroscopy for knee osteoarthritis in the Friday news release, though the model “excludes inpatient-only services, emergency services and services that would pose a substantial risk to patients if significantly delayed.”
“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 Abe Sutton, director of the CMS Innovation Center. “They also increase patient costs, while inflating health care spending.”
Companies that best reduce utilization and spending will receive higher payments. Applications are due from companies July 25.
The Medical Group Management Association (MGMA) opposes the model.
"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," said Anders Gilberg, senior vice president of government affairs of MGMA. "The announcement of this Part B model seems to contradict the administration's recent commitments to ease the burden of prior authorization."