CMS Slaps Its Own A.I. Contractor in Controversial WISeR Program

Just six months into the pilot, CMS ordered one of WISeR's AI contractors to take corrective action as concerns mount over delays, denials, and the privatization of Traditional Medicare.

Last week, the Centers for Medicare and Medicaid Services (CMS) reprimanded one of the six participants in the Wasteful and Inappropriate Service Reduction (WISeR) model just six months after the pilot launched. WISeR is a pilot program that expanded the use of prior authorization in Traditional Medicare in six states and handed the reins over to AI companies to make those decisions about whether or not a patient receives coverage for care.

Private insurance companies use prior authorization extensively in the Medicare Advantage plans they own and operate, resulting in delays and denials of care that have been documented in numerous reports by government watchdog agencies. Until the WISeR program was launched at the first of this year, prior authorization was seldom used in Traditional Medicare.

Since its launch, the pilot has failed to meet its own goals for efficiency and transparency in all six of the pilot states (Arizona, New Jersey, Ohio, Oklahoma, Texas and Washington). The CMS letter to Virtix is the agency’s first acknowledgment of WISeR’s failures.

As Stephen Howie of KUOW in Seattle reported last week, CMS sent a letter to Virtix Health, which operates the WISeR model in Washington state, ordering the company to submit a Corrective Action Plan after determining that it failed to meet required turnaround times for reviewing Medicare requests. Virtix Health’s failures have been documented through local reporting and national investigations. One outlet, the Seattle Times, interviewed patients whose necessary care, including pain management, was delayed for months due to the WISeR model rollout. In one case, a patient was inappropriately denied a pain management treatment that allowed him to walk without pain, and in another case, a patient reported that overturning an incorrect denial took more than two months under the WISeR system.

As HEALTH CARE un-covered first reported in November, there is little public information about Virtix Health, including its board of directors, executives, or physical address. Many of Virtix’s harmful practices were predictable; the company’s primary business is providing Medicare Advantage insurers with risk-adjustment coding services, the very practices that have contributed to tens of billions of dollars in taxpayer overpayments every year.

Virtix Health is not an outlier. Every state in the WISeR pilot has experienced issues like those seen in Washington. As we’ve previously reported, all six of the companies, each processing prior authorization requests for one of the pilot states, have failed to meet the standards set forth by CMS. Patients experienced delays lasting weeks and even months before receiving the care they needed, while providers spent weeks chasing down approvals.

In Arizona, the providers experienced weeks-long delays trying to overturn unfair denials, a system one provider called “completely nonfunctional and unsustainable,” and in Ohio, the portal to submit prior authorization requests - the core of the WISeR pilot - was not operational for months after the pilot’s launch.

Calls to End WISeR Are Getting LOUDeR

CMS’ action is a small step toward accountability, but there are growing calls to end the model altogether. Last month, more than 60 members of Congress, led by Representative Mark Pocan (D-Wis.), sent a previously unreported letter to the Center for Medicare and Medicaid Innovation (CMMI) and CMS asking for a commitment to wind down the model by December 31, 2026.

Letter sent to CMMI and CMS by Rep. Mark Pocan (D-Wis.) and more than 60 other members of Congress.

Separately, Senators Ron Wyden, Maria Cantwell, Richard Blumenthal, and Kirsten Gillibrand and Representatives Suzan DelBene and Greg Landsman introduced resolutions that would repeal WISeR under the Congressional Review Act. The Government Accountability Office (GAO) determined that the program was eligible for this review on May 12, starting a 60-day clock for a forced vote on the resolution of disapproval. Both DelBene and Landsman have discussed these efforts with HEALTH CARE un-covered and shared the impacts they’ve seen on their constituents back home.

The House Appropriations Committee also voted unanimously to include an amendment to a funding bill that would prohibit using any tax dollars on WISeR entirely. The amendment marks a significant step in opposition to WISeR. Representative Lis Frankel (D-Fla.) credited Republican Representative Andy Harris of Maryland, a former physician, for its unanimous, bipartisan support. While the amendment is unlikely to make it into the final bill, this is a significant bipartisan effort to end the model.