Last week, U.S. representatives sent a letter [PDF] to Centers for Medicare and Medicaid Services (CMS) administrator Dr. Mehmet Oz demanding more data on a controversial pilot program, backed by artificial intelligence (AI).

The program, established by CMS and the U.S. Department of Health and Human Services (HHS), requires prior authorization for some services within the traditional Medicare program, in which patients are not assigned to a specific health insurer to manage their benefits. It is part of the Trump administration's ongoing vow to identify and root out what it says is excessive fraud in the U.S. health-care system.

Known as the Wasteful and Inappropriate Service Reduction (WISeR) Model, the program began in six states—Arizona, New Jersey, Ohio, Oklahoma, Texas, and Washington—and is scheduled to run through 2031. It involves some 6.4 million fee-for-service Medicare beneficiaries, nearly a quarter of the U.S. total.

WISeR's intent is to eliminate what federal officials have deemed overspending in several Medicare categories: skin substitutes, typically for patients suffering pressure wounds; electrical nerve stimulators for patients suffering from Parkinson's disease and other neurological ailments; knee arthroscopies to treat osteoarthritis; and impotence care, among others. Altogether, 16 services in five care categories are included in the WISeR initiative. The linchpin of WISeR is its use of AI by six private-sector vendors—one in each state—to flag services authorized by physicians that may have questionable medical value.

Yet the initiative's construction and execution have raised a variety of questions, including whether WISeR was necessary in the first place. For example, on the same day WISeR launched, CMS separately imposed a flat-rate reimbursement of skin substitutes at $127.14 per square centimeter. That move is expected to cut expenditures on such products by 90% and save Medicare nearly $20 billion a year.

WISeR is a procedurally weak experiment with a structurally biased compensation design

Kevin D. Mehta, managing partner at 3Pillar Solutions

Medicare beneficiaries have also experienced issues obtaining services in a timely fashion after WISeR was adopted, and they continue to push back against prior authorizations in general. Nearly 70% of Americans consider prior authorizations a burden to obtaining care, and commercial insurers such as UnitedHealthcare have recently scaled back their use. Preapprovals for medical care and procedures are all but nonexistent in traditional Medicare, and the few areas where it is permitted are closely regulated.

WISeR has also faced criticism for the large cut of Medicare savings paid to private-sector vendors, which could create an incentive for more denials.

"WISeR is a procedurally weak experiment with a structurally biased compensation design," said Kevin D. Mehta, managing partner at 3Pillar Solutions, a Chicago-based health-care information technology consulting firm.

Mehta, who previously served as the executive director of Altarum Health's Center for Value in Health Care, acknowledged that both Democratic and Republican administrations agree that sometimes dubious health-care practices, such as paying more for services provided in a hospital rather than an outpatient clinic, are too costly and should be addressed.

But WISeR's approach to reducing costs is problematic because of its compensation structure: the private-sector vendors retain a percentage—potentially 20%, Mehta suggests—of the cost savings from all care denials issued. That compensation structure is common in private equity-funded deals in health care, but not in government programs, he added.

Suzan DelBene, a U.S. representative from Washington state, believes WISeR is typical for a Trump administration initiative.

"They just go for it. They don't consult Congress. They have no data, no plan, no strategy, and people's health care is being impacted," said DelBene, who has been a vocal critic of WISeR and recently cosponsored legislation to repeal it.

A Rapid Implementation

WISeR's implementation does seem to fit the tech mantra of "break things and move fast." It was announced in late June 2025 and began just six months later.

When WISeR was announced, Oz said: "This new model helps bring Medicare into the twenty-first century by testing a streamlined prior authorization process, while protecting Medicare beneficiaries from being given unnecessary and often costly procedures." Both Oz and HHS Secretary Robert F. Kennedy Jr. allege that fraud is abundant within the Medicaid and Medicare programs, as well as within the state and federal health insurance exchanges. CMS established a webpage devoted to the subject of "crushing fraud, waste and abuse" in the spring of 2025. California and Minnesota have had more than $1 billion in Medicaid funding frozen; suspected fraud has been cited as the reason.

But six months is "a stupidly short timeline," observed a veteran software engineer who works for one of the companies administering WISeR. It forced the companies to scramble to get the initiative off the ground, which has led to glitches, he said. Physicians trying to get a claim approved under WISeR, for example, have often had issues accessing the portals established by the six vendors.

The engineer—who asked that his name and workplace be withheld out of fear of retaliation—also noted that the AI being deployed does not perform much differently than the text-analysis software employed by health-care payers and providers for decades to pore over claims.

Despite the efforts of the contractors, the engineer claims, CMS employees are making the final determinations to deny or approve care, suggesting that the tech promoted by the agency is playing little to no role in coverage decisions.

Among the six vendors contacted for this article, only Humata Health—the WISeR vendor in Oklahoma—responded in any depth. In written comments, Humata CEO and founder Jeremy Friese, MD, suggested that CMS had authority over claims denials.

"Broader data on the overall volume of claims subject to review and non-affirmation rates across the program is something CMS tracks and would be better positioned to address," Friese wrote.

A spokesperson for Cohere Health, which administers WISeR in Texas, said in an email that "your questions on WISeR are best directed to CMS as they govern the data."

WISeR's structure may be attributed in part to Abe Sutton, who heads the Center for Medicare and Medicaid Innovation (CMMI), CMS's lab for exploring new care concepts. Sutton was involved in two health-care startups prior to taking on the role. Brad Smith, Sutton's predecessor during the first Trump administration, was also involved in startups. By contrast, CMMI directors under the Biden and Obama administrations were either clinicians or health-care policy experts, and they had far less private-sector experience.

CMS and the four other vendors did not respond to a list of written questions for this article.

Mehta was also alarmed that CMMI used its authority to waive statutory limits on Medicare prior authorizations by classifying WISeR as a purely voluntary program, which also waived a public notice and comment period. WISeR is voluntary for the six vendors, but not for physicians and other medical providers, he noted.

"I'm sure that CMS wanted to avoid notice and comment and were glad to be able to use the CMMI authority to create something that is 'voluntary,'" said Katherine Hempstead, a Medicare expert and senior advisor at the Robert Wood Johnson Foundation. She believes that tack helps CMS introduce more managed care into the Medicare program without too many people noticing—and objecting.

Concern Over Care Delays and High Denials

There have been consistent grumblings from Medicare advocates and others that WISeR is causing care delays.

"These are treatments that people need that they decided with their providers was appropriate and medically necessary for them, and this new barrier got put in the way that impedes their access to it," said David Lipschutz, codirector of law and policy for the Center for Medicare Advocacy, a Washington DC-based lobbying group for Medicare beneficiaries.

DelBene confirmed that her office has received numerous complaints about WISeR causing care access issues for her constituents.

"We have continued to hear cases, and also from providers, the challenges…of increased bureaucracy on trying to get care and spending more and more time on paperwork and trying to get authorizations approved," she said. One case, she added, was quickly resolved after she brought it up specifically in a hearing with Kennedy in January.

"But it shouldn't take a member of Congress in a hearing to get approval for a procedure that was not an unusual procedure," DelBene said. "What we're seeing on the ground is absolutely the polar opposite of what they say they're supposed to be achieving with this model."

Friese downplayed care delays. He said 88% of prior authorization requests in Oklahoma under WISeR are approved by Humata immediately. "For the remaining 12%, a human physician and nurse review the submission, and many of those still result in affirmation," he wrote, adding that CMS had further data regarding what percentage of those claims are approved.