Democrats Slam Republicans' Proposed Medicare Cuts: 'People Will Die'
Starting January, Medicare will pilot an artificial intelligence (AI) program to assist in deciding whether certain patient procedures get coverage. The Centers for Medicare & Medicaid Services (CMS) introduced the Wasteful and Inappropriate Service Reduction (WISeR) Model, which uses AI to support prior authorization decisions. However, final coverage approvals or denials will still be made by human employees.
Why This Matters
AI has influenced many sectors, including healthcare and insurance. While some worry AI might eliminate jobs, it often improves efficiency. Traditional Medicare has fewer prior authorization requirements than Medicare Advantage plans. The introduction of AI could speed up decisions but might also increase denial rates, experts warn.
A sign in front of the Centers for Medicare & Medicaid Services building was pictured on March 19 in Woodlawn, Maryland.
Key Points to Understand
- Final coverage decisions rest with Medicare employees, not AI alone.
- Critics say companies reviewing claims may be incentivized to deny coverage since they benefit financially from cost reductions.
- The AI pilot aligns with efforts to cut government fraud and waste.
- Medicare Part B premiums are expected to rise by $21.50 monthly, from $185 in 2025 to $206.50 in 2026.
- Services subject to AI prior authorization include skin and tissue substitutes, electrical nerve-stimulator implants, and knee arthroscopy for osteoarthritis.
- Medicare Advantage enrollees faced an average of two prior authorizations in 2023; traditional Medicare beneficiaries had only one per 100 people.
Kevin Thompson, CEO of 9i Capital Group, highlighted the risks: "For seniors, the impact could be substantial, especially when immediate care is critical. What once required a single prior authorization may now face multiple layers, causing delays and higher denial rates."
Voices from the Field
CMS Administrator Dr. Mehmet Oz stated: "CMS is committed to crushing fraud, waste, and abuse. The WISeR Model will root out waste in Original Medicare by combining technology speed with clinician expertise. This new model tests a streamlined prior authorization process while protecting beneficiaries from unnecessary and costly procedures."
Alex Beene, a financial literacy instructor, shared concerns: "Many Americans question the real advantage of Medicare Advantage plans as they haven’t worked efficiently in some regions. The AI pilot and additional authorization steps raise valid concerns."
Kevin Thompson added: "AI may speed up processing times, but errors are inevitable. The bigger issue is financial incentives. If contractors benefit from denying coverage, denial rates will rise regardless of medical necessity."
Looking Ahead
The AI pilot could significantly affect how many procedures get approved for Medicare beneficiaries. A 2024 Senate committee report found that AI-based decisions led to care denials 16 times more often than non-AI decisions.
Beene emphasized: "Medicare recipients want a simple process with fewer barriers. AI can help refine this, but the current approach justifies the concerns being raised."
Insurance professionals should watch this development closely, as it may impact claim approvals, customer satisfaction, and overall risk management.
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