AI Is Being Used to Deny Your Health Care: We Have Proof.

Summary

The report examines WISeR (Wasteful and Inappropriate Service Reduction), a federal pilot launched in January. The program uses outside companies, including AI vendors, to review prior-authorization requests for about a dozen procedures in traditional Medicare across six states. Vendors can receive up to 25% of the savings they generate, which the report says creates a financial incentive to deny or delay care.

The report illustrates the program’s impact through Washington state patient Michael Edgerly. His request for a steroid injection to manage severe back pain was initially denied. After his doctor resubmitted the request, it was approved, and Michael received the injection seven weeks after it was first prescribed. His wife, Carel, describes the delay and says their pain clinic initially received denials on all its submissions. Researchers and providers cited in the report say patients in all six states have faced delays or harm. During the program’s first three months, two vendors reportedly non-affirmed nearly 6,000 requests; in Washington, more requests were denied than approved.

The investigation traces vendor Virtix through a network of corporate entities and finds links to CorroHealth. Virtix’s Texas address is CorroHealth’s headquarters, and several directors of Virtix’s Indian subsidiary also served on CorroHealth India’s board. The report argues that the companies appear to functionally overlap, while noting that the ownership trail leads to private-equity firms Patient Square Capital and Carlyle Group. CorroHealth already earns substantial revenue from healthcare revenue-cycle services, much of which involves handling medical records and billing paperwork. Many of its workers are based overseas.

The report’s broader concern is that AI is being used less to improve treatment than to automate billing and disputes between providers and insurers. CorroHealth provides services to both sides of those disputes. The report discusses “upcoding”—adding diagnoses that can increase payments—as a costly practice in Medicare Advantage, but says it has no evidence that Virtix or CorroHealth has been implicated in such conduct. It also warns that AI-assisted billing could encourage more claims and paperwork, potentially increasing costs rather than reducing them.

The report distinguishes WISeR from other efforts to address Medicare fraud. It cites skin-substitute schemes that inflated costs and argues that audits and other established oversight methods—not prior authorization—are better suited to catching that kind of fraud. A cited report found no evidence that this kind of AI use saves the healthcare system money and warned that it could contribute to rising costs.

Virtix, CorroHealth, Patient Square Capital, and Carlyle Group did not respond to questions about the technology, ownership, offshore operations, or possible conflicts of interest. The report also describes growing congressional scrutiny: the Government Accountability Office found that the program should have been submitted to Congress; lawmakers have sought to end it or obtain updates; and bills have been introduced to terminate it. The administration plans to expand the program to additional services, including ambulances, MRIs, and cancer care.

Michael later tried a spinal stimulator and experienced major pain relief. His doctor sought approval to implant it, but because the procedure was on the WISeR list, the family pursued coverage through the VA instead. The VA approved it within days, and surgery was scheduled for later that fall.

Presenters and Contributors

• Eric Gardner — Host and reporter; identified as Eric in the subtitles
• Zena Wolf — Researcher
• Michael Edgerly — Patient interviewed
• Carel Edgerly — Michael’s wife
• Aparna — Local team member in Chennai; surname not given
• Virtix president — Interviewed; name not given
• Elon Musk — Heard in a quoted clip