Medicare Update: Lawmakers Sound Alarm About Major Change to Program

Newsweek

2 days ago

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More than a dozen House Democrats pressed Centers for Medicare & Medicaid Services (CMS) Administrator Mehmet Oz in a letter last week over CMS's announced plans to expand prior authorization requirements to traditional Medicare through a pilot program.
The new model incorporates artificial intelligence to help make decisions and is being tested in six states beginning in January.
"Let's call it what it is: profit-driven healthcare," a financial expert told Newsweek, "And profit motive and patient care mix about as well as oil and water. Lawmakers are sounding the alarm, because this directly affects many of their constituents."
Why It Matters
The pushback highlights a growing partisan debate over how to reduce Medicare spending without restricting beneficiaries' access to care. It also underscores tensions between the Biden-era expansion of oversight and the Trump administration's stated aim to cut waste while modernizing CMS operations.
House Democrats argued the new prior authorization pilot would create administrative burdens for providers and patients, while some Senate Republicans believe the Medicare reforms are necessary for rooting out fraud and overpayments.
Democratic Congressional Campaign Committee Chair Rep. Suzan DelBene (D-WA) speaks at a news conference after a meeting with the House Democratic Caucus at the U.S. Capitol Building on September 19, 2023 in Washington, DC.
Democratic Congressional Campaign Committee Chair Rep. Suzan DelBene (D-WA) speaks at a news conference after a meeting with the House Democratic Caucus at the U.S. Capitol Building on September 19, 2023 in Washington, DC.What To Know
More than a dozen House Democrats, led by Democratic Representatives Suzan DelBene of Washington and Ami Bera of California, sent a letter to CMS Administrator Mehmet Oz on Thursday, requesting information and urging cancellation of a planned prior authorization pilot for traditional Medicare.
The lawmakers wrote that "traditional Medicare has rarely required prior authorization," and said that, while prior authorization is "often described as a cost-containment strategy, in practice it increases provider burden, takes time away from patients, limits patients' access to life-saving care, and creates unnecessary administrative burden."
The letter asked CMS for details on the pilot's scope, implementation plan and safeguards for beneficiaries.
"Prior authorization is often seen as a roadblock to timely, even life-saving care—replacing the doctor's judgment with an algorithm," Kevin Thompson, the CEO of 9i Capital Group and the host of the 9innings podcast, told Newsweek.
"Let's call it what it is: profit-driven healthcare. And profit motive and patient care mix about as well as oil and water. Lawmakers are sounding the alarm, because this directly affects many of their constituents."
CMS has planned to roll out the prior authorization program in six states starting in January. The Trump administration previously announced a voluntary pledge from major insurers to simplify prior authorization in Medicare Advantage.
Lawmakers said that prior voluntary pledges showed public recognition of the harms of prior authorization, and they urged CMS to reconsider extending similar rules to traditional Medicare.
Separately, Senate Republicans discussed broader Medicare changes as part of proposals to reduce waste, fraud and abuse and to modernize CMS operations.
Republican Senator Thom Tillis of North Carolina said lawmakers were examining CMS contracting practices, duplicate payments and upcoding as potential savings sources, according to The Hill.
The Hill also reported that legislation from Louisiana Republican Senator Bill Cassidy and Democratic Senator of Oregon Jeff Merkley to reduce Medicare Advantage overpayments had bipartisan interest and might be folded into larger budget measures considered by Senate Republicans.
Idaho Republican Senator Mike Crapo said his committee was "evaluating" Cassidy's proposal.
Newsweek reached out to CMS for comment via email.
What People Are Saying
Lawmakers wrote in their letter to CMS administrator, Dr. Mehmet Oz: "Prior authorization has long been abused, and it is bad for patients and providers. The American Medical Association notes, 'Among America's physicians, more than nine in 10 surveyed say that prior authorization has a negative impact on patient clinical outcomes." We urge you to put patients and providers first by cancelling the WISeR model and exploring other ways to limit fraud, waste, and abuse in the Medicare program."
Kevin Thompson, the CEO of 9i Capital Group and the host of the 9innings podcast, told Newsweek: "Will the letter change things? I doubt it. They'll probably get an answer, but expect the same vague, carefully worded response. The current administration is clear on its intent: privatize more of Medicare and crack down on what they label "waste, fraud, and abuse."
Alex Beene, a financial literacy instructor for the University of Tennessee at Martin, told Newsweek: "Few Americans would be in disagreement that services like Medicare and Medicaid should have strong oversight to ensure funding is being properly used, but the concern with the WISeR model being employed is the use of prior authorization for some Medicare services. Medicare Advantage has a history of requiring prior authorization, and while not all uses have been a source of criticism, it is viewed by some beneficiaries as one of several reasons why Advantage has garnered more negative reactions in recent years."
What Happens Next
CMS faced requests from House Democrats to provide documentation and to cancel the planned prior authorization pilot.
Lawmakers in the Senate continue to debate broader Medicare reforms, and committee deliberations could determine whether proposals addressing Medicare Advantage payments or CMS operational changes move into larger legislative packages.
"For the time being, the model isn't nationwide and will be piloted in select states," Beene said. "It's difficult to say if this will eventually be implemented nationwide and will largely depend on how this pilot program goes."