One primary focus in the fight is to rein in fraud through abusive billing for skin substitute products, which are used to treat chronic wounds such as diabetic foot ulcers and venous leg ulcers.
Legislation in both chambers has been introduced in an effort to curb unnecessary spending on such medicines, but neither bill has advanced beyond committee.
Rep. Buddy Carter (R-Georgia) said his House bill introduced last fall would:
- Establish payment limits based on historic volume-weighted average prices.
- Delay implementation of certain coverage changes for one year to allow manufacturers time to complete standardized clinical trials.
- Target what he says is a small percentage of providers who are responsible for a disproportionate share of Medicare spending on skin substitute products through prepayment review and prior authorization.
- Maintain Medicare coverage for these products while reforming how they are reimbursed.
“The fraud is staggering, particularly in health care,” Carter told show host Jody Hice.
He cited claims from California hospices as an example of how government oversight should work better.
“For instance, there were 112 hospices from the same location in Los Angeles. How does that happen? The first time you have a duplicate address, it ought to be kicked out. We need to make sure that we're doing our part there,” Carter said.
Despite their strong clinical foundation, Medicare expenditures for skin substitutes administered in the home and physician office have increased dramatically — from approximately $500 million in 2020 to $6.5 billion in 2024, research by Carter’s staff reveals.
While some of this growth reflects increased utilization in non-hospital care settings, a major driver of this spending escalation is a flawed reimbursement system that incentivizes the use of higher-priced products.
Abuse by a small number of providers is making a big impact.
The top 100 billing providers generated nearly two-thirds of the cost in 2023 ($3.8B) on only 5-6% of patients. That same small outlier group generated nearly half the costs in the sector in 2024, research showed.
Medicare is administered by the federal government through the Centers for Medicare and Medicaid Services (CMS).
Medicaid is primarily for low-income individuals or people with disabilities. Eligibility is based on income and other state-specific criteria.
Federal legislation is important, but the Feds need help in the fraud fight, Carter said.
“We've got to have the policies and the procedures in place to catch these things before they happen. Secondly, we need to make sure that the states are being held responsible as well. We fund these programs, and we count on them to follow through on those programs and develop those programs. They need to have some skin in the game as well,” Carter said.
Identifying fraud, while important, is only part of the goal.
“Every single dollar we lost through fraud should be returned. We need to get it back,” Carter said.
Awareness by CMS — which changed the payment structure for skin substitutes on Jan. 1 — has made a difference in 2026.
The new rules have led to a 99% reduction in billing, CMS executive Kim Brandt told Carter in response to his question in a House hearing in March.
“We have received to my knowledge, no pushback from the beneficiary community saying that they don’t have access to be able to get that care. We would obviously respond if those beneficiaries would come to us and could point to where those problems were occurring. Then we would obviously revisit our approach,” Brandt said.
