Medicare's AI Prior Authorization Pilot Hits Patients With 83-Day Delays and High Denial Rates

Medicare AI Prior Authorization Program Struggles With Massive Delays

Medicare's AI-driven prior authorization pilot program has encountered severe operational challenges since its January 2026 launch, with newly released records revealing treatment delays stretching up to 83 days. The Wasteful and Inappropriate Service Reduction (WISeR) model, designed by the Centers for Medicare & Medicaid Services (CMS)1

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, was intended to reduce spending on services vulnerable to fraud and abuse, including nerve stimulators and steroid injections for pain management. The program operates across six states—Arizona, New Jersey, Ohio, Oklahoma, Texas, and Washington—but has faced widespread criticism for lengthy treatment delays and technical failures2

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The Electronic Frontier Foundation (EFF) obtained roughly 1,000 pages of documents through a Freedom of Information Act (FOIA) lawsuit3

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, exposing the troubled launch of this controversial Medicare AI prior authorization system. These records paint a troubling picture of inadequate testing for accuracy, system failures, and patient harm resulting from the rushed deployment.

Vendors Warned CMS About System Readiness Before Launch

Weeks before the WISeR pilot program went live, contractors raised red flags about their preparedness. Innovaccer, the vendor assigned to Ohio, sent a letter to CMS on December 12, 2025, stating its system lacked full functionality and had not undergone sufficient end-to-end testing1

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. The company warned this "increases the potential for provider abrasion and disruption to beneficiary services." Despite these concerns, Innovaccer moved forward "given CMS's decision not to delay" the program's start.

To avoid creating a backlog, Innovaccer temporarily auto-affirmed all prior authorization requests while completing additional functionality, planning to achieve full system capabilities within 60 days. However, EFF's analysis found documents suggesting some features remained unfinished or untested as of April1

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. This represents a failure to fully test systems before and after launch, raising questions about why CMS proceeded despite clear warnings about the AI system's shortcomings.

High Denial Rates and Technical Failures Plague Healthcare Administration

The records reveal alarmingly high care denials under the program. Virtix Health, serving Washington, and Zyter, serving Arizona, issued more than 20,000 non-affirmations combined during the first three months1

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. Virtix denied more requests than it affirmed during this period, representing high denial rates that exceed normal industry standards. Authorization decisions frequently exceeded the promised 72-hour turnaround, with timeliness data showing substantial backlogs at both vendors.

Of the 1,276 direct prior authorization requests these two vendors received in January, approximately 30% were 6-21 days old1

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. While Virtix reported improvement—with average turnaround time peaking at 8.97 days during initial weeks before falling to 0.51 days by week 11—the early technical failures caused significant patient harm. The AI deployment in healthcare under this model has demonstrated the risks of rushing implementation without adequate testing.

Patients Experience Real Harm From Authorization Bottlenecks

The human cost of these delays has been substantial. In feedback included in the documents, one provider wrote: "I have had to watch three patients cry at bedside for not hearing back on their prior auth for kyphoplasty...These patients are in deep pain"1

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. Arizona interventional pain specialist Dr. Matthew Crooks called the system "unsustainable" after waiting months for payment delays related to epidural steroid injections performed under the program, even those with valid authorization numbers.

Michael Ryan, finance expert and founder of MichaelRyanMoney.com, told Newsweek: "The problem isn't just the algorithm. Medicare inserted AI into prior authorization before parts of the technology and the surrounding process were fully tested and working together. When a request that is supposed to take 72 hours can sit unanswered for weeks, that is no longer administrative efficiency. For the beneficiary, it is delayed treatment"3

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Questions Mount About Testing for Bias and Hallucinations

The EFF's analysis raises critical questions about testing protocols for the WISeR pilot program. Beyond basic functionality issues, concerns exist about whether systems were evaluated for bias and hallucinations—common problems in AI systems that can lead to inappropriate care decisions. The records also highlight questions about audits and monitoring of participating vendors, suggesting insufficient oversight of the private companies operating these platforms.

Kevin Thompson, CEO of 9i Capital Group, observed: "The systems were not thoroughly tested prior to launch, which is now causing lengthy delays beyond the 72-hour prior authorization turnaround. If you show me the incentive, I'll show you the outcome, and that is what you are seeing here: increased denials and longer prior authorization timelines"3

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What This Means for Medicare and Future AI Healthcare Systems

CMS stated it is "firmly committed to ensuring timeliness, accuracy, and transparency" under WISeR and will take corrective actions as appropriate3

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. However, the agency has not responded to specific questions about why it proceeded with the launch despite vendor warnings. The WISeR model operates as a mandatory participation program—providers in participating states cannot simply opt out but must either seek prior authorization through the program or provide services without it, subjecting claims to post-service, prepayment medical review1

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This situation highlights broader concerns about Medicare prior authorization practices, including denied requests later being overturned and the potential for increased authorization workloads to create bottlenecks for doctors and patients. As AI continues expanding into healthcare administration, the WISeR program serves as a cautionary tale about the importance of thorough testing, vendor readiness, and prioritizing patient care over administrative timelines. Watch for potential program modifications or expanded oversight as CMS responds to mounting criticism.