Wound Care: Medicare Audits & The Skin Substitute Surge

by  Knicole C. Emanuel Esq.
Aug 6th, 2025

Federal contractors – Recovery Audit Contractors (RACs) and Unified Program Integrity Contractors (UPICs) – have increasingly targeted wound care claims, particularly involving expensive skin substitutes billed under Medicare Part B.

In 2023 alone, over $1.6 billion was spent on these products, prompting heightened audit activity from Qlarant, Novitas, and others. This intense scrutiny stems from concerns about clinical efficacy, appropriate use, and billing integrity.

Why Auditors Flag Skin Grafts as “Not Medically Necessary”

Auditors frequently argue that skin grafts or tissue products lack medical necessity, based on Medicare’s definitions in CMS IOM 100‑08, Chapter 13, §13.5.1 and applicable Local Coverage Determinations (LCDs).

Common denial rationales include:

• Failure to document at least four weeks of prior conservative care (such as dressings, offloading, antibiotics, physical therapy, or splints) that failed before applying a skin substitute;
• Exceeding allowable applications or duration, when LCDs limit use, for example, skin substitute applications are limited to a certain number within a 12‑week period;
• Use of products deemed investigational, off‑label, or used in a non‑homologous manner under Food and Drug Administration (FDA) and Centers for Medicare & Medicaid Services (CMS) guidelines;
• Allegations of excessive units or reapplications without documented improvement, or use of expensive products without justification; and
• Anti‑kickback concerns, including rebate agreements or manufacturer marketing influence that could bias product choice.

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This article originally published on August 6, 2025 by RACmonitor.

About Knicole C. Emanuel Esq.

For more than 20 years, Knicole has maintained a health care litigation practice, concentrating on Medicare and Medicaid litigation, health care regulatory compliance, administrative law and regulatory law. Knicole has tried over 2,000 administrative cases in over 30 states and has appeared before multiple states’ medical boards. She has successfully obtained federal injunctions in numerous states, which allowed health care providers to remain in business despite the state or federal laws allegations of health care fraud, abhorrent billings, and data mining. Across the country, Knicole frequently lectures on health care law, the impact of the Affordable Care Act and regulatory compliance for providers, including physicians, home health and hospice, dentists, chiropractors, hospitals and durable medical equipment providers. Knicole is partner at Nelson Mullins and a member of the RACmonitor editorial board and a popular panelist on Monitor Monday.