H.R. 5768: Skin Substitute Access and Payment Reform Act

This bill, named the Skin Substitute Access and Payment Reform Act, aims to amend Medicare’s policies regarding skin substitute products. Here is a breakdown of the key components of the bill:

1. Coverage of Skin Substitute Products

The bill modifies the Social Security Act to formally include skin substitute products in Medicare coverage, specifically adding them as a reimbursable item under the existing framework. It introduces a new subparagraph defining skin substitute products, which are materials applied to wounds that remain within the wound bed and are marketed according to specific regulatory requirements.

2. Payment Reform

The bill establishes new payment structures for skin substitute products within Medicare. Key aspects include:

• For 2026, the payment amount will be calculated based on the volume-weighted average of the Medicare payment limits for these products.
• From 2027 onward, payment amounts will be adjusted annually based on increases in the Consumer Price Index.
• A new billing and payment code for skin substitute products will be established, with guidelines set for calculating payments based on historical data.

3. Program Integrity Enhancements

To ensure proper use and prevent abuse of the program, the bill introduces measures to monitor and regulate the distribution of skin substitute products:

• Identification of outlier providers who receive disproportionately high payments will occur biannually, with potential referrals for fraud investigations.
• A prepayment review system will be established for claims submitted by outlier providers unless they meet certain conditions.
• Beginning in 2027, prior authorization may be required for outlier providers to further oversee and limit potential abuse.
• Providers may face exclusion from federal health care programs if abusive billing practices are suspected, with a specific focus on those with high denial rates for claims.

4. Medicare Coverage Criteria

For the year 2026, skin substitute products will be subject to the same coverage criteria as established by Medicare. These products cannot be denied coverage solely based on clinical evidence evaluations unless there are safety concerns.

5. Definitions and Exclusions

The bill provides a clear definition of skin substitute products, stating that they do not include temporary wound coverings or similar items like liquids and gels. This specificity is aimed at clarifying coverage and payment parameters within Medicare.

Relevant Companies

• AVAP - Avalon Globocare Corp might be affected due to its involvement in the healthcare technology sector and development of cellular products for wound care.
• ISRG - Intuitive Surgical, Inc. may see implications as it develops surgical and wound care technologies that could interface with skin substitute products.
• MEDP - Medpace Holdings, Inc. could experience impacts due to its role in trial management and approval processes relevant to new medical products, including skin substitutes.