Medicare fraud is an ugly stain on our healthcare system, draining taxpayer dollars and harming patients who deserve real, effective treatment. Spending on skin substitutes—a category of wound care products—has ballooned from $2 billion to a staggering $12 billion per year. This explosion of waste was not due to growing patient needs but to unscrupulous manufacturers exploiting a loophole in Medicare reimbursement policy. Now, with a renewed focus on fraud prevention and patient-first reform, there’s a clear path forward.
Come April 13, 2025, the Medicare Administrative Contractors new Local Coverage Determination (LCD) will ensure that only skin substitutes supported by robust clinical evidence are covered. This isn’t just a policy update—it’s an exemplary model of what effective healthcare reform looks like with the American peoples’ best interests at heart. It’s also pro-patient, pro-taxpayer, and 100% DOGE-friendly.
This is a textbook example of how government should work: see a problem, close the loophole, and move on. We don’t need to relitigate this fix.
Putting an End to Waste and Abuse – A Win for American Taxpayers
The numbers speak for themselves. In just four years, spending on skin substitutes quadrupled, allowing bad actors to siphon off nearly $10 billion per year from hardworking American taxpayers. One patient in Tennessee was charged an outrageous $1.5 million for treatments that typically cost $20,000. Colorado-based Bloom Healthcare, which uncovered a 17-fold increase in wound care spending, alerted the Department of Justice to potential fraud.
For too long, sick Americans have needlessly suffered at the hands of bureaucratic agencies that have allowed taxpayer dollars to be funneled into the pockets of opportunistic manufacturers. Only recently have local Medicare Administrative Contractors taken action themselves to solve this and post their own policies to address rampant fraud and abuse in the skin substitutes market.
Protecting Access and Restoring Trust in What Works
The loudest voices opposing the LCD aren’t patients or physicians. They’re companies profiting from the status quo. Their claim—that the policy limits access to life-saving care or restricts physician choice—is simply false.
The new policy doesn’t restrict care. It ensures Medicare only covers treatments backed by clinical evidence. Over a dozen brand-name skin substitutes remain available, more than enough to meet the full range of wound care needs. Physicians will continue to have access to every product that has proven its value. What will no longer be covered are overpriced, untested products designed to exploit the system rather than help patients heal.
The idea that doctors need an endless menu of questionable products misunderstands what meaningful clinical choice actually looks like. This is about quality, not quantity––a lesson learned from soldiers’ experience during the Vietnam War. When the military faced an ammunitions shortage, soldiers were supplied with a high volume of cheaper, lower-quality rifle cartridges which frequently jammed mid-firefight. The Congressional investigations that followed revealed that soldiers would have been better armed with fewer rounds of higher-quality, reliable ammunitions.
Like those American soldiers on the battlefield, today’s physicians are expected to deliver results using tools that may fail them when it matters most. The LCD clears out the clutter and gives doctors clarity—fewer distractions, better tools, and more confidence in the treatments they use.
The manufactured narrative of a “shortage” is a distraction. The real shortage was always a shortage of standards. The LCD addresses that, which is why it has broad support from those serious about reform.
This is a settled policy—and it’s the right one. The LCD closes a known loophole, protects patients, and aligns with the Administration’s goals to root out waste and restore accountability. There’s no reason to keep debating it. Let’s move forward and focus on the next chapter: expanding innovation and keeping fraud out of every corner of the healthcare system.
Supporting Innovation – Creating Strong U.S. Jobs
The LCD supports genuine American innovation by rewarding companies that invest in clinical research rather than marketing. That’s the model we need more of: policies that reward value, protect patients, and create good U.S. jobs.
Breakthrough therapies take years of research, testing, and investment. Meanwhile, skin substitute scammers have turned loophole-hunting into a billion-dollar business. Many of the products being excluded by the LCD went from incorporation to nine-figure revenue in under a year—with no research, no FDA review, and no patents. Just bureaucracy and billing codes.
This kind of exploitation punishes real builders. It crowds out the entrepreneurs, engineers, and clinical teams actually working to solve tough medical problems. If we want to grow American leadership in healthcare, this is the kind of reform we need more of—not less.
Restoring Accountability in Government Healthcare Spending
This policy helps restore integrity to government healthcare spending by cutting off the cash flow to bad actors and ensuring that Medicare serves those who need it most—priorities emphasized by the Trump Administration. Medicare fraud investigations can work, but investigations take years, allowing scammers to exploit the system before being caught. The LCD is a proactive measure to stop fraud before it happens.
A Victory for Patients and Taxpayers
For too long, Medicare has been treated as an unlimited slush fund for unethical companies. The Trump Administration has a chance to implement decisive change and save taxpayers billions by supporting the LCD or similar legislation. This is a victory for patients who deserve real, effective care and for taxpayers who should not have to foot the bill for fraudulent claims.
We should support this commonsense reform and reject the misinformation peddled by those who want to keep draining taxpayer dollars for their own gain.
April 13, 2025, marks a turning point, not just because of what’s being fixed, but because of what it clears the way for. The LCD puts this issue to bed. It’s time to double down on patient-first, fraud-free healthcare reform. That’s a win for taxpayers, for patients, and for a broader vision of a healthcare system that delivers value and accountability. It’s also proof that when the government prioritizes integrity, real results follow. Now let’s take that same energy to the next challenge.
Matthew Kandrach is President of the Consumer Action for a Strong Economy (CASE).
