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$127.28: How Medicare’s New Funding for Skin Substitutes Will Impact Beneficiaries
Industry organizations are concerned about patient access, given new reimbursement rates.

November 21, 2025 by Laurie Watanabe

The MASS (Medicare Access to Skin Substitutes) Coalition was unflinching in expressing the impact it believes the Calendar Year 2026 Medicare Physician Fee Schedule final rule will have on skin substitutes and the Medicare patients who depend on them.

“In mid-November, Medicare will finalize a rule that will put most skin substitute companies out of business — punishing patients instead of bad actors,” the coalition’s website says. “On Jan. 1, Medicare will take away coverage for critical wound care products, leaving patients at risk of infection, amputation and death.”

In a Nov. 18 article — “MASS Coalition Condemns CMS Medicare Rule Threatening Wound Care Access,” published in Wounds, the organization was even more straightforward.

“Under the new CMS [Centers for Medicare & Medicaid Services] rule, reimbursement for skin substitutes is capped at $127.28 [per square centimeter] per application, a rate that the MASS Coalition says fails to reflect the real-world cost of these biologic products,” the article said. “According to the coalition, this change will make most FDA-cleared [U.S. Food & Drug Administration] skin substitutes economically unviable, forcing providers to discontinue their use —particularly in Medicare beneficiaries with chronic wounds, such as diabetic foot ulcers and pressure injuries.

“The coalition referenced National Institutes of Health (NIH) data suggesting that up to 187,286 Americans could lose their lives due to loss of access to these therapies.”

Policy changes caused by rising expenditures

The skin substitutes segment has been under the microscope due to rising costs borne by Medicare.

In a Sept. 8 report, the U.S. Department of Health & Human Services’ Office of the Inspector General (OIG) reported “a number of concerning trends” and said Medicare Part B skin substitute expenditures “skyrocketed” during the last two years, which drove the annual cost past the $10 billion mark by the end of 2024.

“Among enrollees with a skin substitute claim, costs for those reportedly treated at home were four times as high as those treated in an office setting,” the report added. “Skin substitutes seem particularly vulnerable to questionable billing and fraud schemes.”

In a press release following the publication of the Physician Fee Schedule, CMS said the final rule “advances primary care management through improved quality measures, reduces waste and unnecessary use of skin substitutes, and introduces a new payment model focused on improving care for chronic disease management.”

CMS added the increase in past payments for skin substitutes “is largely attributed to abusive pricing practices in the sector, including the use of products with limited evidence of clinical value. Current prices can reach more than $2,000 per square centimeter.”

Inadequate funding expected to impact beneficiary access

The new cap of $127.28 per application “fails to reflect the real-world cost of these biologic products,” the MASS Coalition article argued. The funding rate “will make most FDA-cleared skin substitutes economically unviable, forcing providers to discontinue their use — particularly in Medicare beneficiaries with chronic wounds, such as diabetic foot ulcers and pressure injuries.”

The coalition added that skin substitute use reduces “emergency department visits, hospital readmissions, and lower-extremity amputations, yielding long-term Medicare savings of approximately $4000 per patient annually when reimbursement aligns with actual treatment costs.”

MASS Coalition has asked Congress to stop the implementation of the final rule “and require CMS to develop a National Coverage Determination based on current clinical evidence.”

And while CMS said “products with limited evidence of clinical value” drove up wound care expenditures previously,
Convatec, a London-based manufacturer of skin substitutes, said in a Nov. 3 press release that it did provide CMS with evidence.

“InnovaMatrix is a highly effective product with significant health benefits to patients and health care professionals,” the company said. “It has strong user feedback and clinical evidence, and we have recently submitted (October 2025) further real-world evidence (RWE) to CMS, in addition to RWE published in December 2024. Our randomized controlled trials continue to progress towards target publication in 2026.”

In a statement following the physician fee schedule final rule, the American Podiatric Medicine Association (APMA) said, “While APMA appreciates concern from CMS about increasing reimbursement for skin substitutes and that reform is necessary, APMA found that the CMS proposal had significant flaws that will cause unintended consequences for patients with wounds and the physicians who treat them.

“APMA again urges CMS and Congress to work with stakeholders to develop a more reasonable and sound payment methodology that protects access to skin substitutes for Medicare beneficiaries.”

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