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The WISeR Model: CMS’ New Venture into AI‑Driven Reviews and Its Implications for Providers
By: Jenni Colagiovanni and Shaniya Raheja, Wachler & Associates, P.C.
December 2025
On June 27, 2025, CMS announced its plan to implement the Wasteful and Inappropriate Service Reduction (WISeR) Model, purportedly designed to introduce enhanced oversight into the Medicare payment process and to ensure timely and appropriate Medicare payment for select items and services. Incorporating advanced technologies such as artificial intelligence (AI) and machine learning (ML), together with human clinical review, WISeR will involve prepayment assessments of certain items and services. Beginning January 1, 2026, WISeR will be implemented in six states—Arizona, New Jersey, Ohio, Oklahoma, Texas, and Washington—for an initial six‑year performance period.
The stated objective of the initiative is to promote accuracy and timeliness in Medicare reimbursement, while reducing expenditures on services deemed unnecessary or inappropriate. To do so, WISeR will be implemented through “model participants,” which CMS describes as “companies with expertise providing recommendations on medical necessity of coverage for payers using enhanced technology like AI.” The companies selected as model participants will each operate in one of the six states and will be responsible for applying Medicare coverage criteria in National Coverage Determinations (NCDs) and Local Coverage Determinations (LCDs). WISeR will initially target claims for items and services that CMS has identified as subject to inappropriate utilization and of “low value,” including skin substitutes, knee arthroscopy for knee arthritis, and electrical nerve stimulation. Notably, the model excludes inpatient-only services, emergency services, and services that would pose a substantial risk to patients if significantly delayed.
Providers in WISeR rollout states will be permitted to submit claims for prior authorization before the service is provided or request post-service medical review. For this reason, CMS describes the use of prior authorization through the WISeR model as optional; that is, providers who opt for prior authorization will know in advance whether the service will be paid (so long as it is provided consistent with the applicable Medicare coverage guidelines, is appropriately documented, and properly coded and billed), or alternatively, the WISeR review can occur before payment is made for those who do not opt for prior authorization. CMS notes that affirmations (permitting payment on the claim) can be made without human intervention, whereas service denials (or “non-affirmations”) can be supported by technology but must be made by a licensed human clinician. While details remain limited at this time, CMS’ FAQs also suggest that providers and suppliers with strong compliance records may qualify for a “gold card” or a limited exemption from WISeR full review.
A central feature of WISeR is its shared‑savings incentive design, whereby model participants will receive a percentage of the savings associated with “averted, wasteful, inappropriate care as a result of their review.” This arrangement appears to directly tie model participant compensation to “savings” identified based on the model participant’s reviews, presumably creating a financial incentive for model participants to deny claims. In an FAQ raising this concern, CMS suggests that model participants will be financially penalized for inappropriate denials and CMS points to the fact that model participants are responsible for the cost of processing prior authorization requests, including an unlimited number of resubmissions for denied requests, as a kind of ‘check on the system.’ Moreover, CMS notes that providers, suppliers, and beneficiaries will retain their appeal rights on any denied claims and that model participants will not be paid (or will have payment recouped) where review denials are followed by a successful claim appeal. While the practical impact stands to be seen, at a minimum this “safeguard” seems to shift the burden to providers, suppliers, and beneficiaries to undertake the time and expense of appeals in order to protect against improper denials. The proposed framework creates a potential risk that legitimate claims could be denied in pursuit of performance metrics directly tied to compensation.
Another concern is the lack of transparency and bias in the AI review process. While CMS emphasizes that human clinical judgment will remain part of the process, neither the agency (nor its model participants) have disclosed the precise algorithms or training critieria that will be used to flag claims. In addition, AI methods will not necessarily allow providers to know why a claim may be flagged or denied, making it more difficult to adjust documentation or appeal effectively.
Overall, the WISeR Model signals a major shift in CMS oversight, while also raising credible concerns for providers, suppliers, and beneficiaries. By tying reviewer compensation to savings and relying on AI‑driven prior authorization reviews with limited details on human clinical review, CMS risks incentivizing over-denial. Healthcare providers, suppliers, and beneficiaries are advised to stay tuned in as the WISeR Model roles out, as time will tell if WISeR’s implementation is the first step of broader adoption of AI-based prior authorization across Medicare.
Short Bios:
Jenni Colagiovanni is a partner at Wachler & Associates, P.C. Ms. Colagiovanni practices in all areas of healthcare law and devotes a substantial portion of her practice to regulatory compliance, physician contracting, and reimbursement matters, including Medicare, Medicaid, and third-party payor audit defense.
Shaniya Raheja is an attorney at Wachler & Associates, P.C. Ms. Raheja practices various areas of healthcare law with a focus on Medicare audit appeals.