Medicare's new AI pilot denies care to seniors — and pays firms more when they deny it
A federal pilot called WISeR uses AI-assisted vendors to approve or deny Medicare treatments, and internal documents show the companies get paid a cut of whatever they refuse.
What happened: In January 2026, the Trump administration launched WISeR, a pilot in six states (New Jersey, Ohio, Oklahoma, Texas, Arizona, Washington) that requires Medicare patients to get AI-assisted prior authorization before certain procedures, something traditional Medicare never demanded before. Documents obtained by the Electronic Frontier Foundation, plus Senate testimony, show the rollout has been chaotic: one vendor wasn't ready and had to auto-approve everything temporarily, another confused basic Medicare coverage categories for months, and a third denied more requests than it approved. Patients have waited weeks or months in pain for answers that were supposed to come within 72 hours.
Why it matters: This isn't a private insurer using AI to manage costs, it's the government applying that model to Medicare, which covers roughly 68 million seniors and disabled Americans. Providers describe patients crying at bedside waiting on approvals for painful spine procedures, and say vendors are often unreachable. The Government Accountability Office found the administration didn't follow proper rulemaking steps to set WISeR up, calling into question whether it's even legal. Lawmakers who tried to force the release of more documents were blocked by a party-line committee vote.
How it works, plainly: CMS pays contracted companies not a flat fee, but 25 percent of whatever Medicare would have spent on a procedure they deny, a structure a CMS actuary memo itself warned would push vendors to "deny as many claims as possible." There is a penalty system, called the Aggregate Quality Score, meant to punish bad-faith denials, but the math is soft: even a company scoring as low as 60 percent still keeps 90 percent of its denial payments. Because only about 11.5 percent of Medicare Advantage denials get appealed, most wrongful denials likely just stand.
The fight over it: At a Senate confirmation hearing, HHS nominee Chris Klomp incorrectly told Sen. Patty Murray that contractors don't profit from denials; CMS's own documents say otherwise. Murray noted Washington's contractor denied more claims than it approved in early 2026. Despite the documented problems, CMS is planning to expand WISeR beyond pain and cardiac procedures into oncology, MRIs, pacemakers, defibrillators, air ambulance transport, and genetic testing, with the pilot slated to run through 2031.