On June 27, 2025, the Center for Medicare & Medicaid Innovation (“CMMI”) announced the Wasteful and Inappropriate Service Reduction (“WISeR”) Model, its latest model focused on reducing clinically inappropriate and low-value services in traditional Medicare.
Unlike prior CMMI models, WISeR stands out for its exclusion of traditional health care providers, such as hospitals and physician groups, as direct participants. Instead, the model invites voluntary participation from technology companies that specialize in medical necessity determinations, particularly those using AI-assisted tools. These companies, rather than providers, will be responsible for reviewing claims in designated states.
Participants will be assigned to one of six pilot states: Arizona, New Jersey, Ohio, Oklahoma, Texas or Washington, where they will operate within specific Medicare Administrative Contractor (“MAC”) jurisdictions.
Process for Providers
Under the WISeR model, providers and suppliers in the selected pilot states can submit prior authorization requests for certain services (listed below) either directly to the designated model participant (a private technology vendor) or through their MAC, which will forward the request to the participant.
Although prior authorization is technically optional, providers who choose not to submit a request and instead bill Medicare directly will have their claims flagged by the MAC and routed for prepayment medical review. In this review, providers may be required to submit supporting documentation, and payment may be delayed until a medical necessity determination is made. While this process differs from prior authorization denial, it imposes a similar administrative burden, but without the advantage of advance approval before delivering care. Essentially, bypassing prior authorization exposes providers to potentially delayed payments and greater uncertainty about claim approval.
If a prior authorization request is “non-affirmed” (i.e., denied) before the service is furnished or billed, providers have unlimited opportunities to resubmit the request. They may also request a peer-to-peer review to discuss clinical details with the reviewer. Despite a non-affirmed decision, providers may still deliver the service and submit a claim. Should the claim later be denied by the MAC based on medical necessity, that denial becomes an initial payment determination, subject to Medicare’s administrative appeals process (42 C.F.R. part 405, subpart I).
Over time, providers with high compliance rates may receive an exemption, similar to a “gold card” status, relieving them of review obligations and further reducing administrative burden.
Examples of selected items and services include:
- Stimulator Services
- Induced Lesions of Nerve Tracts
- Epidural Steroid Injections for Pain Management
- Percutaneous Vertebral Augmentation for Vertebral Compression Fracture
- Cervical Fusion
- Arthroscopic Lavage and Arthroscopic Debridement for the Osteoarthritic Knee
- Hypoglossal Nerve Stimulation for Obstructive Sleep Apnea
- Incontinence Control Devices
- Diagnosis and Treatment of Impotence
- Percutaneous Image-Guided Lumbar Decompression for Lumbar Spinal Stenosis
- Skin and Tissue Substitutes
The model excludes inpatient-only services, emergency services and services that would pose a substantial risk to patients if delayed.
Participant Company Incentives and Oversight
Under the WISeR model, participating technology companies are compensated based on a percentage of the cost savings they generate by preventing payments for medically unnecessary or non-covered items and services in their assigned regions. Savings are calculated from prior authorization non-affirmations that do not result in paid claims, adjusted by the average total claim payments from the previous 12 months.
Additionally, payments are adjusted annually based on quality performance metrics, with poor performance reducing payments to discourage adverse incentives. Participant performance will be evaluated based on several measures:
- Accuracy and timeliness of determinations.
- Provider and supplier satisfaction (measured by survey).
- Clinical quality and compliance with Medicare standards.
- Adherence to HIPAA and CMS data security rules.
- Ability to provide non-digital submission channels (e.g., fax, phone, mail).
Practical Takeaways
This shift signals CMMI’s growing interest in leveraging private-sector data analytics and AI capabilities to influence care decisions and reduce inappropriate utilization, potentially altering how providers interact with utilization review and prior authorization processes in the future. While CMMI officially requires that final coverage decisions must be made by licensed clinicians and not solely by AI tools, there is concern among providers that, in practice, AI-supported reviews may heavily influence or effectively drive these decisions. This raises questions about the degree of meaningful clinical oversight and whether the safeguards will be sufficient to protect providers from erroneous or overly aggressive denials.
Preparing Your Organization for WISeR: Next Steps
The WISeR model represents a significant shift in Medicare claims review, with increased reliance on technology vendors and new administrative processes that may strain hospital resources. Providers and suppliers in the six states should begin preparing now by:
- Reviewing current prior authorization and claims workflows for impacted services.
- Engaging with MACs and vendor partners to understand technical integration and operational expectations.
- Assessing potential financial impact from delayed payments and claim denials.
- Updating policies and training staff on documentation and appeals processes.
- Consulting legal counsel to review contracts, compliance programs and dispute resolution strategies.
For more information or assistance with the WISeR Model, please contact:
- Scott Strickland at (919) 447-4965 or sstrickland@hallrender.com;
- Raminta Kizyte at (303) 557-2112 or rkizyte@hallrender.com; or
- Your primary Hall Render contact.
Special thanks to Summer Associate Nick Baker for his assistance with the preparation of this article.
Hall Render blog posts and articles are intended for informational purposes only. For ethical reasons, Hall Render attorneys cannot give legal advice outside of an attorney-client relationship.
