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

This section establishes Medicare Part B coverage for skin substitute products (defined as cellular, tissue, biological, or synthetic materials applied to wounds and intended to remain in the wound bed, marketed under specified FDA authorities, excluding temporary dressings or liquid/gel/powder items) by adding them to the list of covered physicians' services under section 1861(s)(2)(KK) of the Social Security Act (42 U.S.C. 1395x(s)(2)). It applies the average sales price (ASP) payment methodology of section 1847A of such Act (42 U.S.C. 1395w–3a) to these products furnished on or after January 1, 2026, with payment at 80% of the lesser of the actual charge or the ASP-determined amount (i.e., for 2026, the volume-weighted average Medicare payment allowance limit from 2023 claims data in the October 2023 ASP Pricing File, updated annually thereafter by the CPI for All Urban Consumers); excludes such products from ASP reporting requirements beginning in 2026; and directs the Secretary of Health and Human Services to establish a consolidated billing and payment code for them by January 1, 2026. (Thus, this reforms low Medicare payment rates for skin substitutes—currently treated as supplies paid at 80% of reasonable charges—by standardizing payment based on weighted historical limits and annual inflation adjustments.)

This section establishes special Medicare Part B payment rules for skin substitute products (i.e., human cell- and tissue-based products applied to chronic wounds, as defined in 42 U.S.C. 1847A(c)(6)(J)) to enhance program integrity. (1) Requires the Secretary, not later than December 1, 2025, and every two years through December 1, 2035, to identify the top 3% of providers by total payments received for such products in the prior year (based on national provider identifier), publish the list, and refer it to the HHS Office of Inspector General for fraud, waste, or abuse review. (2) Mandates prepayment claim review, beginning January 1, 2026, for claims from identified outlier providers unless the products are subject to prior authorization, the provider's approval rate exceeds 90%, or billing practices comply with coverage criteria. (3) Requires prior authorization, beginning no later than January 1, 2027, for such products furnished by outlier providers (for a period set by the Secretary), with termination if the approval rate exceeds 90%; provides $5 million annually for FY2027 through FY2030 from the Federal Supplementary Medical Insurance Trust Fund. (4) Directs that, beginning January 1, 2028, if an outlier provider's prior authorization denial rate exceeds 75% for six or more consecutive months, the Secretary deem an abuse of billing privileges under 42 C.F.R. 424.535(a)(8)(ii) and refer the provider to the OIG for potential exclusion from federal health care programs under SSA section 1128(b)(6). (5) Specifies that skin substitute products furnished in 2026 are subject to existing Medicare coverage criteria under SSA section 1862(a)(1)(A) unless deemed unsafe due to contamination, infectious disease, or serious adverse events, and prohibits denial of coverage based solely on clinical evidence analysis through prepayment review or prior authorization programs.