Understanding WISeR: AI in Medicare and Its Implications

On March 25, 2026, the Electronic Frontier Foundation filed a lawsuit against the federal government over a healthcare program most Americans have never heard of. The target: a quietly launched artificial intelligence system called WISeR, which has been making coverage decisions for Medicare patients since January 1 of this year — without any public disclosure of how it works, who built it, or how often it gets things wrong.

The EFF’s lawsuit is about transparency. But the story behind it is about something bigger: what happens when algorithms replace doctors in deciding who gets care, and whether those algorithms can be trusted with the health of millions of elderly Americans.

What Is WISeR — and Why Does It Matter?

WISeR stands for “Wasteful and Inappropriate Service Reduction.” The name alone signals the program’s intent: identify healthcare spending that the government considers unnecessary and stop it before it happens. The program was announced by CMS Administrator Dr. Mehmet Oz and launched on January 1, 2026, as a six-year pilot running through December 2031 across six states: Arizona, New Jersey, Ohio, Oklahoma, Texas, and Washington.

Across those six states, approximately 6.4 million Medicare beneficiaries are now subject to the program.

Here is what WISeR does in practice: before certain medical treatments can be delivered and billed to Medicare, providers must now obtain prior authorization. An AI system screens the request. If the AI flags it as potentially “low-value,” a licensed clinician employed by the technology vendor reviews it and issues either an affirmation or a non-affirmation. Affirmed means the service can proceed. Non-affirmed means it doesn’t — unless the provider resubmits or requests a peer-to-peer consultation.

Historically, traditional Medicare did not require prior authorization for most services. This was one of the key differences between original Medicare and Medicare Advantage, the privatized version of the program that has long been criticized for using prior authorization to delay or deny care. WISeR represents a fundamental philosophical shift: the government is now borrowing one of the most controversial tools from the insurance industry playbook and applying it to the program that covers nearly 70 million Americans.

The 17 services currently targeted include skin and tissue substitutes, electrical nerve stimulator implants, and knee arthroscopy for osteoarthritis — all procedures that CMS says have been associated with fraud, waste, and inappropriate use. CMS points to a 2025 HHS Office of Inspector General report finding that Medicare Part B spending on skin substitutes alone exceeded $10 billion in 2024, with significant evidence of fraud.

The Business Model Behind the Algorithm

Here is where things get complicated — and contentious.

The six companies selected to operate WISeR — Cohere, Genzeon, Humata, Innovaccer, Virtix, and Zyter — are not paid a flat fee for processing requests. Their compensation is tied, in part, to the savings they generate. According to the EFF’s press release and prior reporting, vendors can collect as much as 20 percent of associated savings when they deny coverage.

CMS has pushed back on characterizations of this as a conflict of interest. Officials have stated that vendors are “not incentivized to deny claims, but to get the determination right.” Coverage decisions are expected within 72 hours for standard requests and 48 hours for expedited cases. CMS also plans to offer “gold card” status to providers with consistently approved histories, exempting them from future prior authorization requirements — a feature expected to roll out by mid-2026.

But skeptics are not reassured. The American Hospital Association, in formal comments submitted to CMS in October 2025, called the compensation structure “inherently biased” and drew a direct comparison to a prior arrangement with MultiPlan — the subject of a New York Times investigation and an ongoing federal antitrust lawsuit — where financial incentives were similarly tied to denying claims.

Carol Howard, a veteran health system revenue cycle leader and vice president at Janus Health, put the concern bluntly: “I would expect to see at least 25% of hospital claims for traditional Medicare going through WISeR being denied.” A 2024 Senate committee report found that AI tools in prior authorization settings had been linked to denial rates 16 times higher than decisions made without the technology.

What the EFF Is Actually Demanding

The EFF’s lawsuit is a Freedom of Information Act complaint. In plain terms: the organization submitted a FOIA request to CMS seeking basic information about the program and received nothing. Now it is suing to compel disclosure.

What did the EFF ask for? Specifically: contracts and agreements with the six participating technology vendors; any records related to testing the AI systems for accuracy, bias, or hallucinations; and any audits, monitoring reports, or evaluations of the program’s performance to date.

None of this has been released.

“Tasking an algorithm with making determinations about treatment can create unwarranted — and even discriminatory — delays or denials of necessary medical care,” said Kit Walsh, EFF’s Director of AI and Access-to-Knowledge Legal Projects. “Given these serious risks, the public requires transparency that it hasn’t gotten.”

This is not a fringe concern. Without knowing what training data the AI systems use, it is impossible to assess whether they encode racial, socioeconomic, or geographic biases. Without audit records, there is no way to know how often the AI is wrong — or what happens to patients when it is. Without knowing how vendors are held accountable, there is no check on the financial incentive to deny.

Just weeks after WISeR’s launch, hospitals and providers in the six pilot states began reporting delays in care approval, communication gaps, and increased administrative strain. But because no performance data has been released, no one can quantify the damage.

The Political and Medical Backlash

WISeR has drawn fierce opposition from both sides of the aisle and across the healthcare profession — a notable alignment in an era of deep partisan division.

Representative Frank Pallone (D-NJ), the ranking Democrat on the House Energy and Commerce Committee, said he was “concerned that this AI model will result in denials of lifesaving care and incentivize companies to restrict care.” In November 2025, a bipartisan group of congressional representatives introduced legislation to repeal the WISeR model; it is currently in committee. A House resolution was also introduced to halt the model entirely.

From the provider side, Dr. Jayesh Shah, president of the Texas Medical Association, acknowledged that WISeR may have legitimate goals but warned that “prior authorization delays care and sometimes also denies care to patients who need it, and it increases the hassle factor for all physicians.” Dr. Bindu Nayak, an endocrinologist in Washington state — one of the six pilot states — told Stateline: “It will be important for patients to realize that they may see more barriers in the form of denials, but they should continue to advocate for themselves.”

The AHA went further in its formal comments, urging CMS to allow Medicare patients to formally appeal prior authorization denials directly to CMS — a right that Medicare Advantage patients already have — rather than being limited to resubmission or peer-to-peer consultation with the same vendor that denied the request in the first place.

The AHA also raised a critical technical objection: the submission platforms being used by WISeR vendors do not use FHIR-enabled APIs, meaning providers cannot route authorization requests through their existing electronic health record systems. Instead, staff must manually extract clinical information and submit it separately — adding significant administrative burden on top of an already stretched workforce.

What Patients and Providers Should Know Now

If you or a family member is on traditional Medicare in one of the six states — Arizona, New Jersey, Ohio, Oklahoma, Texas, or Washington — you are already inside the WISeR pilot. Here is what that means practically:

Understand which services are affected. The 17 targeted procedures are specific and generally elective: they include skin and tissue substitutes, certain electrical nerve stimulators, and knee arthroscopy for osteoarthritis. Emergency care, inpatient-only services, and anything that “would pose substantial risk if significantly delayed” is excluded. If your provider recommends one of these procedures, ask whether a prior authorization request will be required.

Know the timelines. Standard prior authorization decisions are expected within 72 hours; expedited decisions within 48. If a delay is threatening your care, ask your provider to flag the request as expedited.

Understand your appeal options — and their limits. Under the current WISeR structure, if a prior authorization is denied, your provider can resubmit or request a peer-to-peer consultation with the vendor’s clinician. Unlike Medicare Advantage, there is currently no formal right to appeal a WISeR denial directly to CMS before the service is delivered. The AHA has flagged this as a significant gap, and advocacy organizations are pushing CMS to close it.

Providers: begin documentation preparation now. Authorization requests under WISeR require robust clinical documentation. Practices in affected states should review which of the 17 services they commonly provide, map existing workflows, and confirm whether their current EHR systems can interface with vendor portals. Achieving “gold card” status — which would exempt high-performing providers from future requests — requires a track record of approvals, which means getting the documentation right from the start.

Track outcomes and report problems. Given the lack of public performance data, provider organizations and patient advocates are the main channel through which problems will surface. The AHA, state medical associations, and patient rights groups are actively collecting information on delays, denials, and administrative failures. If WISeR is affecting your care or practice, document it and report it to your professional association.

The Larger Stakes: A Template for the Future

The WISeR pilot is scheduled to run through 2031 — but industry observers expect that if it generates savings without triggering catastrophic political backlash, it will expand. Carol Howard, the revenue cycle expert, put it directly: “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. The prior auth process will probably become a mainstay for all states and probably expand to more procedures.”

In other words, WISeR is not just a pilot. It is a test case for whether the federal government can use AI-powered prior authorization as a permanent cost-control mechanism across the entire Medicare program.

That is why the EFF’s lawsuit matters beyond its immediate target. The question of whether Americans can access basic information about an algorithm making decisions about their healthcare is not a technical legal question. It is a question about what kind of healthcare system the country wants — one where coverage decisions are made by accountable, transparent processes, or one where an algorithm’s logic, training data, and error rate are classified as proprietary business information.

As Kit Walsh of the EFF put it: “The public has a right to know more about the algorithms driving decisions around their healthcare. Without greater transparency, patients, providers, and policymakers will continue to be left in the dark.”

The litigation will unfold in the Northern District of California. Its outcome could set a precedent for AI transparency in federal healthcare programs for decades to come.

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