Medicare skin substitute claims spike 7,100%

The Trump administration said on July 9 that Medicare claims for skin substitutes, a wound-care product category also called allografts, climbed 7,100% between 2019 and 2025 to $14.4 billion. The increase prompted a review by the administration’s anti-fraud task force and the Centers for Medicare & Medicaid Services, according to a report citing CMS. (fox9.com) CMS said it identified 4,200 suspicious skin-substitute claims totaling $224 million in charges through May and had denied 96% of claims in the category since March. (fox9.com) The agency’s scrutiny comes after the HHS Office of Inspector General warned in 2025 that Medicare Part B payment trends for skin substitutes raised “major concerns” about fraud, waste and abuse. (ccf.georgetown.edu) A separate CMS push is unfolding in Medicaid. Georgetown University’s Center for Children and Families said CMS in April directed all 50 states to move quickly to revalidate high-risk Medicaid providers and to submit two-year revalidation strategies, citing fraud and program-integrity concerns. (fox9.com) ### How big was the increase in Medicare skin-substitute billing? The billing increase ran from roughly $200 million in 2019 to $14.4 billion in 2025, according to the administration’s account of CMS data. Fox-owned local outlet Fox 9, citing CMS, reported the category’s rapid growth led federal officials to flag potentially fraudulent claims. (fox9.com) The HHS inspector general had already documented sharp growth in the same area. In a 2025 report, the watchdog said Medicare Part B spending on skin substitutes had risen so fast that payment reforms were urgently needed to address fraud, waste and abuse while preserving appropriate patient care. (ccf.georgetown.edu) ### What exactly are federal officials doing now? CMS said it had denied 96% of skin-substitute claims submitted since March after identifying suspicious billing patterns. The agency also counted 4,200 suspicious claims worth $224 million through May, according to the July 9 report. The enforcement push is part of a broader federal focus on wound-care and skin-substitute billing. (fox9.com) Other recent reporting and legal analyses have described rising Justice Department and regulator attention to alleged unnecessary procedures, inflated pricing and abusive billing practices in the category. ### Why is Minnesota showing up in a Medicaid story? Minnesota is being treated as an early test case for aggressive provider revalidation. (oig.hhs.gov) Georgetown’s Center for Children and Families said the state was already conducting an off-cycle revalidation of high-risk providers before CMS issued its April directive, under a corrective action plan approved by CMS on March 19. Minnesota’s own revalidation page said high-risk providers had to complete the process by May 31, 2026. (fox9.com) The state launched the effort after Governor Tim Walz in October 2025 ordered a third-party audit of Medicaid billing for designated high-risk services. ### What did CMS tell states to do? CMS Administrator Mehmet Oz sent letters on April 23 to governors and state Medicaid directors calling for a “swift revalidation” of high-risk Medicaid providers, Georgetown and trade publications reported. (nurse.org) States were asked to tell CMS within 10 business days whether they would carry out the review and to submit a comprehensive two-year provider revalidation strategy within 30 days. (ccf.georgetown.edu) High-risk providers are already subject under federal rules to checks that can include licensure reviews, database checks, site visits and criminal background checks, Georgetown said. States must revalidate Medicaid providers at least every five years, but the April directive sought a faster timetable for providers viewed as higher risk. (mn.gov) ### What happens next for providers and patients? Providers in Medicare wound care and in Medicaid categories designated high risk should expect more enrollment scrutiny, according to Georgetown and several legal and industry analyses. Those reviews can lead to denied claims, payment holds, disenrollment or added paperwork if provider files are incomplete or outdated. (ccf.georgetown.edu) Minnesota’s process offers one near-term marker. State materials said providers that did not successfully complete revalidation by May 31 faced disenrollment, and subsequent appeals and corrective actions there are likely to be watched by other states as CMS reviews the two-year strategies it requested in April. (mn.gov) (ccf.georgetown.edu)