Medicare's 2026 Crackdown on Medical Practices

Medicare's crackdown on medical practices in 2026 has one idea behind it: stop the money before it goes out, and sort out who was right afterwards. For decades the program paid claims and chased fraud later. In February 2026 CMS announced a move away from that "pay and chase" model, toward stopping payment up front. Fraud is real and costs everyone, including honest practices. But the tools chosen to fight it put the burden of proof on the practice, often with little explanation, a slow answer and no clear way to push back. This article explains the three moves that matter most, the questions they raise about fairness and legality, and what a practice can do now.

What changed in 2026?

Three things, each aimed at a different part of the work.

Change	What it does	Who feels it
The WISeR model	Private vendors, using AI, approve or deny certain services before they are done, in Original Medicare	Practices in six pilot states that perform the listed services
The proposed RPM outsourcing limit	Medicare would stop paying for remote monitoring done by outside vendor staff	Every practice that runs remote patient monitoring with contracted staff
Data-driven payment freezes	Models flag billing patterns, and CMS can hold claims, suspend payment or revoke enrollment before an investigation ends	Any practice whose billing looks unusual to a model

None of these is a court ruling or a finding of wrongdoing. Each is an administrative tool, and that is exactly why practices worry: the decision comes first and the explanation, if any, comes later.

What is WISeR, and why are practices angry about it?

The Wasteful and Inappropriate Service Reduction model (WISeR) started in January 2026 in New Jersey, Ohio, Oklahoma, Texas, Arizona and Washington, and is set to run until 2031. It brings prior authorization, long familiar from Medicare Advantage, into Original Medicare for a list of services that includes skin substitutes and epidural steroid injections for pain. Private technology vendors review the requests with AI tools, and CMS says a licensed clinician must make every denial.

Records released through a public records lawsuit by the Electronic Frontier Foundation and reported by STAT describe a rushed launch:

Two vendors together denied 5,944 requests in the first three months.
One vendor denied more requests than it approved and was put on a corrective action plan.
CMS expected answers within 72 hours, yet one request went unanswered for 83 days.
One vendor warned before launch that a working product by the start date was unrealistic.

The part that troubles practices most is how the vendors are paid. According to the EFF's reading of the records, vendors earn money from spending they avert, are not paid for denials that are later overturned, and lose only a small share of their payment for low quality scores. A reviewer that earns more by saying no is a reviewer with a reason to say no.

Medicare's proposed limit on outsourced remote monitoring

In July, CMS published its proposed Physician Fee Schedule for 2027. As the CMS fact sheet and the AMA's summary describe it, the proposal would:

pay for remote patient monitoring only when the work is done by clinical staff employed by the billing practice, not by a third-party vendor;
require a separate, billable visit to start an episode of monitoring;
limit remote therapeutic monitoring to patients who already have a relationship with the practice;
consider folding today's RPM codes into a smaller set.

The proposal points to an Office of Inspector General review that found companies enrolling patients without regard to need, billing for monitoring that never happened and enrolling patients without the staff to watch the data. Those abuses are real. The fix, though, falls on every practice that relies on outside help, including small and rural practices that cannot hire a monitoring team of their own. Comments closed on September 14, 2026. The final rule is expected in early November, and if it keeps this shape, it takes effect on January 1, 2027.

For how a practice can run monitoring with its own team, see our guide to the RPM staffing model.

Payment freezes before the facts are in

In August CMS announced that it had stopped more than $1.6 billion in potentially improper payments to diagnostic laboratories, through revoked enrollments, payment suspensions, recoupments and referrals to law enforcement. The CMS announcement describes the method: AI and machine-learning models scan claims for unusual billing patterns, and CMS can hold or deny claims and suspend payment before any investigation is finished.

Labs came first. The same approach can reach any practice whose numbers look unusual, and the announcement does not explain how its models tell a documentation slip apart from misconduct. For a practice, a payment suspension means weeks or months of work with no money coming in, while it proves it did nothing wrong.

Is this legal?

No court has ruled any of these measures unlawful, and CMS has broad power to protect the Medicare trust fund. The criticism is about fairness and process, and it is pointed:

No appeal before care. Under WISeR there is no formal way to appeal a denial to CMS before the service is delivered, unlike in Medicare Advantage.
Paid to deny. Vendor payment tied to averted spending invites denials, and quality penalties are small.
Black-box decisions. The EFF sued because CMS would not say how the AI tools work, what data trained them or how bias is checked.
Punish first, prove later. Suspensions and revocations can come before an investigation ends, which leaves an innocent practice carrying the cost of the government's suspicion.

Whether these practices cross a legal line is for courts and Congress to decide. What is already clear is that the burden has moved onto the practice. The practices that come through an audit or a denial in good shape are the ones that can show, quickly and in full, what was done, by whom and when.

How can a practice protect itself?

Treat every record as evidence. Who ordered it, why, what the patient agreed to, and what was done each day. Our RPM documentation checklist covers what to record.
Keep every change on file. An edited note or status should keep its earlier version and show who changed it. A record that can be quietly rewritten is a weak defense.
Give every request an owner. Prior authorization requests, denials and resubmissions belong in a shared list with a count, so nothing waits unseen past a deadline.
Read every denial reason. The codes tell you whether to fix, resubmit or appeal. Our guide to common claim denial reasons explains how to read them.
Plan for in-house monitoring now. If outside staff run your RPM today, decide before January who on your own team would take it over.
Talk to your health care counsel before you change contracts, billing or staffing because of a proposed rule.

Frequently asked questions

What is the WISeR model?

WISeR is a Medicare pilot that started in January 2026 and runs until 2031. It requires prior authorization in Original Medicare for certain services in six states, reviewed by private vendors using AI tools, with a licensed clinician required for every denial.

Which states are in WISeR?

New Jersey, Ohio, Oklahoma, Texas, Arizona and Washington.

Will Medicare stop paying for outsourced remote patient monitoring?

CMS has proposed it for 2027: payment only when the monitoring is done by clinical staff employed by the billing practice. It is a proposal until the final rule is published, expected in early November 2026, and would take effect on January 1, 2027.

Can Medicare suspend payments without an investigation?

CMS can suspend payments and revoke enrollment based on credible allegations of fraud and data analysis, before an investigation is complete. A practice facing a suspension should contact its health care counsel right away.

How can a practice prepare for a Medicare audit?

Keep a complete record of who ordered each service and why, the patient's consent, what was done and when, and every change to the record. A practice that can produce that record quickly is in the strongest position.

Sources

Trump Administration Prioritizes Affordability by Announcing Major Crackdown on Health Care Fraud (February 25, 2026), CMS
WISeR (Wasteful and Inappropriate Service Reduction) Model, CMS
WISeR Model Frequently Asked Questions, CMS
WISeR Model Request for Applications, selected services, CMS
Calendar Year (CY) 2027 Medicare Physician Fee Schedule Proposed Rule, fact sheet, CMS
CY 2027 Payment Policies Under the Physician Fee Schedule (proposed rule), Federal Register
CMS Prevents $1.6 Billion in Fraudulent Medicare Laboratory Payments, CMS
Consumer Alert: Remote Patient Monitoring, HHS Office of Inspector General
Additional Oversight of Remote Patient Monitoring in Medicare Is Needed, HHS Office of Inspector General
42 CFR 405.371, suspension of payment to providers and suppliers, eCFR text via Cornell LII

Medicare's 2026 Crackdown on Medical Practices: Deny First, Explain Later

The short answer