Your doctor says you need pain treatment, but Medicare’s AI might disagree

CLEVELAND, Ohio — Ohioans on Medicare who rely on steroid injections to manage pain may have to wait longer for treatment next year while an AI program approves or declines care.

That’s because claims for this and several types of health care will need prior approval when submitted to traditional Medicare — a change from the current policy— under an upcoming pilot program aimed at curbing waste, fraud and abuse.

Ohio, along with five other states, is part of the pilot program called the Wasteful and Inappropriate Service Reduction (WISeR) Model.

The six-year trial program is slated to start in January, but congressional opposition has placed its funding in question.

Physicians and patient rights groups also are critical of the program, predicting it will restrict and delay necessary care for the elderly, and concerned about its use of AI to make prior authorization decisions.

“It will save money at the cost of the patients,” said Charlotte Rudolph, executive director of Universal Health Care Action Network of Ohio, an affordable health care advocacy organization. “Patients on Medicare are some of our most vulnerable Ohioans, and just the thought of them getting wind of this procedure — that’s undue stress that patients don’t even need to hear.”

Judith Stein, founder of the Center for Medicare Advocacy, agreed.

“It creates a barrier between what physicians and other healthcare providers order and want as medically necessary for their patients and what can be provided based on algorithms,” Stein said. The Center for Medicare Advocacy works to ensure access to Medicare coverage, health equity, and quality health care for older people.

The pilot initiative will focus on claims for about a dozen procedures, including skin and tissue substitutes, electrical nerve stimulator implants, knee arthroscopy, devices for incontinence control, cervical fusion, steroid injections for pain management and the diagnosis and treatment of impotence, the Centers for Medicare and Medicaid said.

Hospital stays, emergency services, and services that would risk patient health if delayed, are not included in the initiative, the federal government said.

The targeted services represented as much as $5.8 billion in spending in 2022, according to federal data.

Medicare is the federal health insurance program for people 65 and older and some younger people who have disabilities. More than 2.5 million Ohioans are enrolled in Medicare, according to Healthinsurance.org, an independent health insurance guide.

Prior authorization has pros, cons

The pilot initiative’s use of prior authorization — which requires preapproval for certain treatments before care is provided —has put renewed scrutiny on the controversial practice.

Prior authorization can be effective in eliminating unnecessary or ineffective treatments. It also can cause delays in care, necessitate expensive out-of-pocket medical expenses and increase health insurance company profits, health policy experts say.

Nearly one in five insured adults experienced claim denials during a 12-month period, according to KFF’s 2023 survey. Those with private health insurance or Affordable Care Act policies experienced claim denials about twice as often as those covered by Medicare or Medicaid, whose denial rates were around one in 10, according to the survey.

The public’s anger over denials of medical claims was evident on social media posts after the 2024 shooting death of UnitedHealthcare CEO Brian Thompson. UnitedHealthcare has been the target of a class action lawsuit claiming that the company uses AI to wrongfully deny elderly patients care.

Medicare’s proposed policy change also will erase a major difference between traditional, or original Medicare and Medicare Advantage.

Currently, original Medicare does not require prior approval for healthcare services, while Medicare Advantage and many private health insurance companies do.

In Medicare Advantage programs, the federal government contracts with private health insurance plans to provide coverage for older Americans.

About 56% of Ohioans on Medicare belong to Medicare Advantage plans, according to Healthinsurance.org, an independent health insurance guide.

“(The proposed change is) a backdoor way of putting everybody in a Medicare Advantage plan,” said Carrie Graham, executive director of the Medicare Policy Initiative at Georgetown University, which provides information on healthcare to policymakers. “It’s a first step to getting rid of, or downgrading, the freedom that traditional Medicare provides.”

In 2023 about 12% of prior authorization denials for Medicare Advantage were appealed, but more than 80% of those denials were overturned, said Stein of the Center for Medicare Advocacy.

But the vast majority of prior authorization denials are not appealed, because the system is too complicated for many elderly, disabled or chronically ill people to navigate, Stein said.

“Their physicians are also burdened with many, many things, and often aren’t in a position (to help) or don’t want to help,” Stein said. “Having been told that the care isn’t necessary, it’s not surprising that the vast majority of people don’t challenge prior authorization denials.”

Health insurance companies are increasingly using AI to make decisions about what healthcare services to deny or allow, according to press reports.

Typically, AI reviews patient records to determine if a requested procedure meets an insurer’s criteria. Government officials said that any denials issued as part of the Medicare pilot program would be reviewed and approved by “an appropriately licensed human clinician, not a machine.”

But some reports have found that using AI can lead to high denial rates and worsen health disparities, since AI algorithms trained on biased data will perpetuate the biases, stated a paper written by the Medicare Policy Initiative at Georgetown University.

Critics of the Medicare pilot program point out that the AI companies overseeing the initiative will receive a share of the savings generated by denied claims, giving the companies incentive to deny as many claims as possible.

“I think AI is like getting the camel’s nose under the tent to start using more electronic means of identifying and limiting coverage,” Stein said.

“While supposedly there is a clinician that’s going to double check if the electronic AI says that this care shouldn’t be covered, my experience tells me that doesn’t happen in many instances,” she said.