Traditional Medicare Gets Prior Authorization: What This Means for Your Coverage Decisions
By Jacqueline M. Payne, RN, BSN - Medicare Insurance Broker
August 29, 2025
As your Medicare insurance broker, I'm always monitoring policy changes that could impact your healthcare coverage. Today, I need to share some significant news that may reshape how you think about Medicare plan options.
The Game-Changing Announcement
The Centers for Medicare and Medicaid Services just announced a pilot program that will fundamentally alter traditional Medicare's coverage approach. Starting January 2026, beneficiaries in six states will experience prior authorization requirements for certain medical procedures – something that was previously exclusive to Medicare Advantage plans.
If you live in Arizona, New Jersey, Ohio, Oklahoma, Texas, or Washington State, this directly affects you.
What's Really Happening
This new "Wasteful and Inappropriate Service Reduction Model" will use artificial intelligence to review approximately twelve specific procedures before approving coverage. The targeted procedures include:
- Spine surgeries and certain steroid injections
- Incontinence control devices
- Cervical fusion procedures
- Specialized nerve stimulators
- Impotence diagnosis and treatment
- High-cost skin substitutes
According to the recent New York Times investigation, private companies will operate these AI systems and receive payment based on the money they save Medicare through claim denials. This creates a direct financial incentive to reject coverage requests.
From a Broker's Perspective: The Strategic Implications
For Traditional Medicare Beneficiaries: This change eliminates one of traditional Medicare's most significant advantages – straightforward coverage without bureaucratic hurdles. Many of my clients specifically chose Original Medicare to avoid the prior authorization maze common in Medicare Advantage plans.
Clinical Insights from a Nursing Background
Having worked as a registered nurse before becoming a Medicare broker, I've witnessed firsthand how prior authorization delays can impact patient outcomes. The American Medical Association calls these processes "one of the most burdensome and disruptive administrative requirements" healthcare providers face.
What concerns me most is the AI-driven decision-making model. While algorithms can process information quickly, healthcare decisions often require nuanced understanding of individual patient circumstances that technology may miss.
Strategic Guidance for My Clients
If You're in a Pilot State:
- Document Everything: Maintain comprehensive medical records and ensure your providers document medical necessity thoroughly.
- Understand the Timeline: Plan for potential delays in procedure approvals and discuss timing with your healthcare team.
- Know Your Appeal Rights: Most successful appeals happen, but you must be proactive about the process.
- Reassess Your Coverage Strategy: This might be an opportune time to evaluate whether a Medicare Advantage plan could better meet your needs.
If You're Outside Pilot States:
- Stay Informed: This program could expand nationwide depending on results.
- Consider Future Planning: Think about how these changes might influence your long-term healthcare strategy.
The Insurance Professional's Analysis
From a risk management perspective, this program represents a significant shift in Medicare's approach to cost containment. While controlling wasteful spending is important, the methodology raises several concerns:
- Conflict of Interest: Paying companies based on claim denials creates inherent bias against patient care
- Access Barriers: Additional approval steps may delay or prevent necessary treatments
- Provider Burden: Healthcare professionals will spend more time on administrative tasks rather than patient care
What This Means for Your Medicare Decisions
Current Traditional Medicare Beneficiaries: If you chose Original Medicare to avoid prior authorization hassles, you may need to reconsider your strategy. The landscape is shifting, and your current plan may no longer offer the advantages you originally sought.
Your Next Steps
Don't navigate these changes alone. As your Medicare insurance broker, I'm here to help you understand how this development affects your coverage and what options best serve your healthcare and financial needs.
Contact me today to schedule a no-cost Medicare plan review and discuss how these changes might impact your coverage strategy.
Jacqueline M. Payne, RN, BSN, is a licensed Medicare insurance broker with Curam Broker, specializing in helping seniors navigate Medicare options and healthcare policy changes. For personalized Medicare guidance, visit curambroker.com or call for a consultation.
Source: New York Times, "Medicare Will Require Prior Approval for Certain Procedures", August 28, 2025