HR-9972-119
Referred to the Committee on Energy and Commerce, and in addition to the Committee on Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
Sponsored by Pete Sessions (R-TX)
What it does
This bill would set a fixed Medicare payment rate of $457 per square centimeter for skin substitute products (cellular, tissue, biological, or synthetic wound-healing materials) from 2027 through 2030. It would restrict Medicare coverage to products that are domestically sourced, manufactured, and distributed, with a waiver available during supply shortages. The bill would also add fraud-prevention measures including prepayment review, prior authorization for high-billing providers, certification requirements for providers, and a floor price of $342.75 per square centimeter below which Medicare would not pay for a product.
Who benefits
Medicare beneficiaries with chronic or acute wounds (e.g., diabetic ulcers, pressure sores) who may gain more consistent access to covered skin substitute products. U.S.-based manufacturers of skin substitute products, who would gain a competitive advantage over foreign-sourced products. Domestic tissue banks and processing facilities. Certified wound care specialists, whose certification would become a prerequisite for billing. Taxpayers and the Medicare program, to the extent fraud-prevention provisions reduce improper payments. Domestic tissue donors and their families, whose contributions would be prioritized.
Who is hurt
Foreign manufacturers and importers of skin substitute products, who would be excluded from Medicare reimbursement. Providers who currently bill heavily for skin substitutes and would face prepayment review or prior authorization requirements. Patients in areas with limited access to certified wound care specialists, who may face reduced provider availability. Smaller or newer domestic manufacturers who may struggle to meet attestation and distribution requirements. Providers who obtain products through intermediary distributors, as direct-distribution requirements could disrupt existing supply chains. Medicare administrative contractors, who would bear new review and oversight burdens.
Supporters argue
Supporters argue that the skin substitute market has been plagued by documented fraud and abuse, with Medicare spending on these products growing from roughly $1 billion in 2015 to over $10 billion in recent years — a pattern flagged by the HHS Office of Inspector General. They contend that setting a standardized payment rate, requiring domestic sourcing, and mandating provider certification would simultaneously protect taxpayer dollars, ensure product quality and safety, and reduce the exploitation of Medicare beneficiaries by unscrupulous providers. They further argue that the domestic sourcing requirement strengthens supply chain security and reduces dependence on foreign-produced biological materials used in wound care.
Opponents argue
Opponents argue that the fixed $457-per-square-centimeter rate and the $342.75 floor price are arbitrary figures not clearly tied to cost data, and that the domestic sourcing mandate functions as a trade restriction that could reduce product competition, limit patient choice, and potentially raise costs. They contend that requiring wound care certification as a billing prerequisite may reduce access to care in rural and underserved areas where such specialists are scarce, disproportionately harming the patients the bill aims to protect. They further argue that the prior authorization and prepayment review burdens could delay medically necessary wound care for vulnerable Medicare patients.
Constitutional context
Congress has broad authority to set Medicare payment terms under the Taxing and Spending Clause (Art. I, §8, cl. 1), and the domestic sourcing requirement is a condition on federal program participation rather than a direct mandate on manufacturers. No active constitutional tension is implicated, though post-Loper Bright (2024), any HHS rulemaking to implement the bill's waiver authority or coverage criteria would face independent judicial review rather than automatic deference.
Checks and balances
Congress gains authority by setting fixed payment rates and eligibility conditions directly in statute, reducing HHS discretion; HHS retains limited administrative authority over waivers, attestation processes, and outlier provider determinations, subject to judicial review under post-Loper Bright independent statutory interpretation.
Historical precedent
Congress previously addressed Medicare skin substitute billing abuses through the Consolidated Appropriations Act of 2023, which directed CMS to reform payment for these products, reflecting a pattern of incremental legislative responses to OIG-identified fraud in this specific market.