Medicare's new pilot program taps AI to review claims. Here's why it's risky

"Medicare has launched a six-year pilot program that could eventually transform access to healthcare for some of the millions of people across the U.S. who rely on it for their health insurance coverage. Traditional Medicare is a government-administered insurance plan for people over 65 or with disabilities. About half of the 67 million Americans insured through Medicare have this coverage. The rest have Medicare Advantage plans administered by private companies."

"The pilot program, dubbed the Wasteful and Inappropriate Service Reduction Model, is an experimental program that began to affect people enrolled in traditional Medicare from six states in January 2026. During this pilot, medical providers must apply for permission, or prior authorization, before giving 14 kinds of health procedures and devices. The program uses artificial intelligence software to identify treatment requests it deems unnecessary or harmful and denies them. This is similar to the way many Medicare Advantage plans work."

Medicare launched a six-year pilot called the Wasteful and Inappropriate Service Reduction Model that started affecting traditional Medicare enrollees in six states in January 2026. The pilot requires medical providers to obtain prior authorization before delivering 14 specified procedures and devices. The program uses artificial intelligence software to screen treatment requests and deny those it identifies as unnecessary or harmful. About half of the 67 million Americans on Medicare are covered by traditional Medicare, while the remainder have Medicare Advantage administered by private companies. The pilot resembles prior authorization processes used in many Medicare Advantage plans and could reduce program spending, but it requires close monitoring to protect patient health.

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