The WISeR prior authorization model for Medicare is set to pose challenges for hospitals

Hospitals and other healthcare providers soon will have a larger set of prior authorization requirements to account for in traditional Medicare as a new pilot model gets underway.

Technology companies participating in the six-year, six-state Wasteful and Inappropriate Service Reduction (WISeR) Model are supposed to have their portals up and running by Jan. 5, with healthcare services subject to the new model starting Jan. 15.

Providers in Arizona, New Jersey, Ohio, Oklahoma, Texas and Washington will face prior authorization requirements for 14 selected Part B services, all of which are typically elective rather than first-line diagnostics or treatments for a medical condition, CMS says. If a provider chooses not to engage in prior authorization, the service will have to undergo prepayment review.

A handful of hospital outpatient services have been subject to prior authorization nationwide since 2020. The WISeR Model does not overlap with that program.

Incentives to deny authorization

It’s notable that the entities formally designated as the WISeR Model participants are not providers or payers but instead are six healthcare technology companies. Their compensation will hinge on the amount of money they save Medicare by identifying and reducing what CMS deems inappropriate or wasteful low-value services. Payments also will be adjusted based on metrics of accuracy, timeliness and provider experience.

Given the payment criteria, “I would expect to see at least 25% of my [hospital] claims for traditional Medicare going through the WISeR program being denied,” said Carol Howard, vice president for innovation and adoption with Janus Health and previously a health system revenue cycle leader.

It won’t be a surprise if some health systems find they are not optimally prepared for the model, she said.

“I’m really concerned that hospitals haven’t done due diligence to prepare for this,” Howard said. “Have they gone in and looked at that data to see who is ordering those services at their hospital? Have they gone to those [physician] offices and provided education?”

Mechanics of the model

For the 14 services, hospitals can submit prior authorization requests through one of the six model participants (Cohere, Genzeon, Humata, Innovaccer, Virtix, Zyter) or through their Medicare administrative contractor (MAC).

Among the model’s deadlines are a three-day window for the participating companies to issue a determination on the prior authorization request and a 45-day time frame for the hospital to submit clinical documentation for prepayment review if necessary. If the hospital outsources its prior authorization requests, the vendor will need the URL for the submission portal, Howard noted.

Hospitals that successfully follow the requirements of the new model can attain gold-card status, meaning they are exempt from WISeR processes. CMS is expected to announce further details on the gold-card program later in 2026.

At the start of the prior authorization request, the MAC will provide a unique tracking number (UTN). Hospitals should use the number on all successive claims information for the service in question.

Providers “will need to ensure the UTN is included on each submitted claim if the service is rendered, regardless of whether the prior authorization request determination is an affirmation or non-affirmation,” CMS wrote in a guidance document.

How to handle WISeR requirements

Hospitals can get a sense of what to expect from the upcoming prior authorization criteria by reading HHS Office of Inspector General reports on some of the covered products and services, Howard said. Among the available reports are investigations into skin substitutes and neurostimulator implants.

Another important step is to ensure clinical documentation processes are optimal, with the documentation precisely conveying medical necessity. That will be needed to help providers navigate the technology being deployed by WISeR-participating companies.

“The problem is when you have an AI agent looking at your document, if you’re trying to [imply] something and not [being] explicit about it, it’s going to end up being denied,” Howard said. “The physicians have to be very explicit. There are all these things that have to be documented in the note.”

Howard advises specifically keeping an eye on scenarios where a patient has been transferred from the emergency department to observation. She expects that any of the 14 procedures would automatically be subject to WISeR if they have a “Type of Bill” designation of 13X.

“The ED E&M code is excluded, but I’m curious how they’re going to be if you do one of the procedures, like a pain injection in the back, and it’s not emergent, [as in] life-threatening,” Howard said. “You are going to have to get a UTN for that.”

Hospitals “may have to set up some more billing edits to try and flag all this stuff to make sure that the UTN is there before submitting the claim, or they can submit it and then wait for a prepayment review,” she added.

An eye on the big picture

WISeR fits in with the Trump administration’s effort to reduce spending on healthcare services perceived as low-value. That push especially is being seen with respect to skin substitutes. Separately from WISeR, the administration has changed Part B payment for most skin substitutes from biologic-based pricing to a flat rate ($127.28 per square centimeter in 2026), classifying the products as incident-to supplies.

Given the larger context, the WISeR model is likely to expand, Howard said, adding that it’s easy to envision CMS not waiting the full six years of the pilot phase.

“The prior auth process will probably become a mainstay for all states and probably expand to more procedures,” she said. “If these model participants work out and there’s not a ton of kinks, not a lot of delays, I can see them expanding it for sure.”