Prior Authorization Expands to Traditional Medicare in 2026

Starting in 2026, CMS will require prior approvals for select services in six pilot states under a new model.

Starting January 1, 2026, the Centers for Medicare & Medicaid Services (CMS) will roll out a major policy shift: prior authorization requirements will now apply to some services under Traditional (Original) Medicare in six pilot states—New Jersey, Ohio, Oklahoma, Texas, Arizona, and Washington.

Why This Matters

Historically, prior authorizations were mostly associated with Medicare Advantage (MA) plans, while Original Medicare gave providers much more freedom. This change narrows that gap and introduces oversight to 17 services flagged as high-risk for fraud, waste, or abuse.

This rollout is part of CMS’s new WISeR Model (Wasteful and Inappropriate Service Reduction), designed to test how AI and machine learning can assist in reducing unnecessary care and improving the authorization process. However, licensed clinicians—not machines—will still make the final call on whether a service is approved.

What’s Behind the Change?

CMS and the Department of Health and Human Services (HHS) are ramping up their efforts to fight fraud and inefficiency across all Medicare programs. These efforts align with ongoing initiatives to:

• Cut down on wasteful or low-value care

• Protect beneficiaries from being targeted for unnecessary procedures

• Ensure federal dollars are being used appropriately

A recent case in Arizona illustrates why some services are under scrutiny: providers allegedly billed over $1 billion for unnecessary wound grafts, often targeting terminally ill patients.

How It Will Work

Agents should understand the basics of how this new model will operate:

• The WISeR Model focuses on outpatient services with a high risk of abuse.

• It excludes emergency care, inpatient-only services, and anything that would harm a patient if delayed.

• Providers can either submit a prior authorization request or face a post-service, pre-payment medical review.

Impact on Insurance Agents

For agents, this change could:

• Shift client expectations around Original Medicare, which some have historically preferred due to its fewer restrictions.

• Require more education and guidance for clients—especially those who may be surprised to encounter prior authorization under Original Medicare.

• Open new conversations about Medicare Advantage vs. Original Medicare, particularly around how each handles approvals and service access.

• Influence plan recommendations, especially in the six pilot states.

Final Thoughts

This new prior authorization pilot may only affect a few services and states for now, but it signals a broader trend toward more oversight and utilization management across all Medicare offerings. As CMS evaluates the results, agents should be ready for the possibility of expanded implementation in the future.

Stay informed and proactive—these changes could reshape how clients view their Medicare options, and your expertise will be key in helping them navigate what’s ahead.

Source:
https://www.kiplinger.com/