Traditional Medicare Spending on Skin Substitutes Far Exceeds Medicare Advantage, Report Finds
Key Takeaways
- Traditional Medicare spent greater than $5.6 billion more on skin substitutes compared with Medicare Advantage from 2019–2023.
- Skin substitutes were the largest identified savings opportunity, with Medicare spending several times more per product than Medicare Advantage.
- Limited utilization controls in traditional Medicare contributed to higher use and higher costs, according to the report’s findings.
A new analysis highlights a major cost gap in wound care spending, revealing that traditional Medicare paid dramatically more for skin substitutes than Medicare Advantage plans—a difference totaling more than $5.6 billion from 2019 to 2023. The findings, published by the Berkeley Research Group and reported by Becker’s Payer, suggest that traditional Medicare missed out on significant savings due to limited oversight tools and rapidly rising utilization.1
Skin Substitutes Represent the Largest Missed Savings Opportunity
Skin substitutes stood out as the single greatest savings opportunity among all services reviewed in the report. Traditional Medicare’s spending was 1.5 to 6.5 times higher than Medicare Advantage, which relies more heavily on utilization management strategies, such as prior authorization, to prevent unnecessary or excessive use.1
Federal oversight bodies have separately documented that Medicare Part B spending on skin substitutes has surged past $10 billion, driven by rising prices and increased use across physician offices and home care settings. Medicare Advantage plans, by contrast, account for only a fraction of national skin-substitute expenditures.1
Lack of Oversight Tools Drives Cost Disparities
The report notes that traditional Medicare’s limited ability to employ utilization controls plays a central role in the spending gap. Without the same guardrails used by Medicare Advantage, traditional Medicare experienced broader use of high-cost wound-care products and less consistent claims review—ultimately translating into billions in avoidable spending.1
As policymakers continue evaluating reforms to curb Medicare overspending, the dramatic rise in skin-substitute expenditures may become a key area of focus moving forward.
Reference
- Casolo E. Traditional Medicare misses $7B in savings: Report. Becker’s Payer Issues. Published December 2025. Accessed December 12, 2025. https://www.beckerspayer.com/research-analysis/traditional-medicare-misses-7b-in-savings-report/
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