America Doesn't Have a Wound Care Problem—It Has an Incentive Problem

Traci A. Kimball, MD, MBA, CWSP; Thomas E. Gardner 

1. The core failure is structural—not clinical. 
The United States is not failing chronic wound patients due to lack of medical capability, but because the reimbursement system incentivizes activity over outcomes. Providers are paid for procedures, products, and applications—not for healing, limb salvage, or preventing hospitalizations. This misalignment drives poor outcomes despite high spending. 

2. Explosive spending without improved outcomes signals systemic distortion. 
Medicare spending on skin substitutes ballooned with no equally measurable improvement in amputations, hospitalizations, or mortality. Highly concentrated utilization and application rates highlight a payment model that rewards volume and price—not evidence-based care or patient results. 

3. Real reform requires shifting to outcome-based, whole-patient care models. 
These authors contend that the solution is to “pay for healing”—align reimbursement with outcomes, expand coverage frameworks, and enable data-driven, multidisciplinary care. However, policy change must be paired with infrastructure (AI, analytics, coordinated care systems) to make value-based wound care scalable and sustainable. 

The United States is quietly failing one of its most vulnerable patient populations: the millions of Americans living with chronic, nonhealing wounds. These patients are older, medically complex, and too often invisible—until their condition escalates into hospitalization, amputation, or death. 

But the failure is not clinical. It is structural. And the evidence is now impossible to ignore. 

"We don't pay for healing in US health care. We pay for activity—applications, procedures, products. But not limb salvage, not infection prevention, not avoided hospitalization." 

The current policy conversation is largely organized around a single question: how do we reduce spending on wound care? It is the wrong question. 

The right question is: how do we pay for healing?  

When we do pay for healing, however —when reimbursement aligns with outcomes rather than volume, when care is coordinated rather than episodic, when data drives decisions rather than marketing—something remarkable happens.^1,2 Costs fall. Amputations decline. Hospitalizations decrease. And patients, finally, win. 

A major amputation carries a 5-year mortality rate comparable to many cancers.^3,4 This is not a niche issue, this is a public health crisis hiding in plain sight We are not talking about a billing problem. The aforementioned public health emergency hides inside a reimbursement code—and a policy window, right now, to do something meaningful about it. 

Medicare Part B spending on skin substitute products surged from $1.6 billion in 2022 to $10.2 billion in 2024⁵—roughly 16 percent of all Part B drug spending that year— Yet, in our depth of work in the wound healing community, we continue to see amputations, wound-related hospitalizations, and mortality persist. 

The utilization data is even more striking. Surprisingly few providers accounted for the majority of total skin substitute expense.⁵  Those same providers billed for an average frequency of graft applications per patient per year far outside evidence-based guidelines, and most  occurred in home or senior housing settings. Average spending per patient for top products ranged in the hundreds of thousands of dollars, as did some beneficiary coinsurances.⁵ 

The utilization picture is even more striking. Spending for certain products can reach into the hundreds of thousands of dollars, significant applications were taking place outside of evidence-based guidelines based on place of service and frequency.⁵ Although this may not have been the broad usage scenario, it had a deep impact on healthcare spending – and at what benefit to patients?  

This is not innovation. It is distortion—the predictable result of a payment architecture that rewards volume over value, price over performance, and product application over patient outcomes. 

The Centers for Medicare & Medicaid Services (CMS) is very aware of the problem, to the tune of billions. In its Final Physician Fee Schedule Rule for 2026,⁶ CMS introduced a significant policy change: replacing variable, ASP-based reimbursement with a flat national "incident to" supply payment per square centimeter for skin substitutes in all settings - a site-neutral policy. 

While this is directionally correct, it may become THE market overcorrection event, with its estimated reduction in Medicare spending on skin substitutes by over 90 percent⁷- patient access to safe and effective care is allegedly threatened.  Wound care specialist providers are no longer skeptical of that forecast - it’s current state. 

Chronic wounds do not care whether they are treated in a clinic, a home, or a long-term care facility. If the incentive problem is not addressed across all sites of care, utilization will simply migrate—and the $10 billion problem will continue. 

"A major amputation carries a five-year mortality rate comparable to many cancers. This is not a niche issue. It is a public health crisis hiding in plain sight." 

The deeper pathology in this system is that United States healthcare reimbursement was never designed around outcomes. It pays for applications. It pays for procedures. It pays for products. It does not pay for limb salvage, infection prevention, functional recovery, or avoided hospitalization. 

In advanced wound care, success is not the application of a graft—it is the preservation of a life. And the data on what integrated, multidisciplinary care can achieve is clear: programs built around data-driven, coordinated, whole-patient wound management have demonstrated reductions of approximately 40 percent in both major amputations and operational costs - total costs of care.^8,9 Those are not incremental gains. Those are system-level corrections. 

At their core, chronic wounds are not dermatologic problems. They are systems biology problems. The patients who carry them almost always have diabetes, vascular disease, infection risk, mobility limitations, and social determinants that compromise adherence and outcomes. Treating the wound without treating the patient is like patching a leak without fixing the pipe. 

If we are serious about reform—not just managing a headline—policymakers need to move beyond the current siloed framework.  Adjustments to the next Final Physician Fee Schedule iteration would transform it from a good start into a genuine inflection point. We feel those adjustments should include the following:  

1.  Inclusive Coverage of Non-Healing Acute and Chronic Skin Injuries. Pressure ulcers, dehiscing surgical wounds, pyoderma gangrenosum, and other complex wound types remain outside the current frameworks —and therefore exposed to the same forces that created the current crisis - add them in with diabetic foot ulcers and venous leg ulcers - and give them all their NAME - the princess in the movie The Never Ending Story needed a name to save Fantasia. 

2.  Outcome-Based Measurement and Reimbursement. Chronic wounds defy the standardization required by traditional randomized controlled trials—no 2 patients, no 2 wounds are sufficiently alike. Real-world clinical evidence, enabled by AI-driven analytics, predictive healing models, and automated documentation, must be elevated as the evidentiary basis for future policy. CMS has already signaled movement in this direction through the WISeR pilot program. The next step is tying reimbursement to validated outcomes. 

3.  A Pathway for Innovation. Food and Drug Administration (FDA) clearance should not be negated by outdated reimbursement definitions. Today, products cleared by the FDA as safe and effective are routinely denied coverage because they don't conform to legacy product categories. That is not regulatory prudence. It is institutional inertia—and it impedes exactly the kind of clinical innovation that could reduce long-term costs. Categorical reinvention of the inventions is needed. 

Policy reform, by itself, is necessary but not sufficient. The infrastructure to execute value-based wound care must also exist—and until recently, it largely has not. 

In our experience, that infrastructure requires: AI-enabled wound intelligence platforms that can track healing trajectories in real time; integrated electronic health record (EHR) and revenue cycle management systems that eliminate documentation burden and charting burnout; automated medical necessity validation that enables prior authorization before care is delivered, not after; and longitudinal patient engagement tools that keep complex patients in their care pathways. 

This is not theoretical. These systems are being built and operationalized today—with pilots likely underway that we hope will generate the real-world evidence that policy needs to catch up with clinical reality.  

One statement sums up our current scenario: policies are theoretical, but the disease is not.  

Dr. Kimball is a board-certified wound specialist physician and founder of The WISH Clinic^®, a value-based advanced wound care model integrating clinical care, analytics, and whole-person healing, and of EKagra Health, an AI-enabled wound intelligence platform. 

Mr. Gardner is a medtech entrepreneur and senior advisor to healthcare companies. He is the founder and former CEO of Omeza, with prior experience at Johnson & Johnson, IMS Health, and IntegriChain. He advises companies at the intersection of wound care, data infrastructure, and AI-driven reimbursement reform. 

1. Musuuza J, Sutherland BL, Kurter S, et al. A systematic review of multidisciplinary teams to reduce major amputations for patients with diabetic foot ulcers. J Vasc Surg. 2020;71(4):1433-1446.e3. 

2. Somayaji R, Elliott JA, Persaud R, et al. The impact of team-based interprofessional comprehensive assessments on the diagnosis and management of diabetic foot ulcers: a retrospective cohort study. PLoS One. 2017;12(9):e0185251. 

3. Armstrong DG, Swerdlow MA, Armstrong AA, Conte MS, Padula WV, Bus SA. Five-year mortality and direct costs of care for people with diabetic foot complications are comparable to cancer. J Foot Ankle Res. 2020;13(1):16. doi:10.1186/s13047-020-00383-2 

4. Sen CK. Human wound and its burden: updated 2020 compendium of estimates. Adv Wound Care (New Rochelle). 2021;10(5):281-292. doi:10.1089/wound.2021.0026 

5. Office of Inspector General, US Department of Health and Human Services. Medicare Part B payment trends for skin substitutes raise major concerns about fraud, waste, and abuse. Published 2025. Accessed May 14, 2026. https://oig.hhs.gov/reports/all/2025/medicare-part-b-payment-trends-for-skin-substitutes-raise-major-concerns-about-fraud-waste-and-abuse/ 

6. Centers for Medicare & Medicaid Services. Medicare and Medicaid programs; CY 2026 payment policies under the physician fee schedule and other changes. Federal Register. Published November 5, 2025. Accessed May 14, 2026. https://www.federalregister.gov/documents/2025/11/05/2025-19787/medicare-and-medicaid-programs-cy-2026-payment-policies-under-the-physician-fee-schedule-and-other 

7. Centers for Medicare & Medicaid Services. CMS modernizes payment accuracy, significantly cuts spending waste. News release. Published 2025. Accessed May 14, 2026. https://www.cms.gov/newsroom/press-releases/cms-modernizes-payment-accuracy-significantly-cuts-spending-waste 

8. Lo ZJ, Chandrasekar S, Yong E, et al. Clinical and economic outcomes of a multidisciplinary team approach in a lower extremity amputation prevention programme for diabetic foot ulcer care in an Asian population: a case-control study. Int Wound J. 2022;19(4):765-773. doi:10.1111/iwj.13672 

9. Albright RH, Manohar NB, Murillo JF, et al. Effectiveness of multidisciplinary care teams in reducing major amputation rate in adults with diabetes: a systematic review and meta-analysis. Diabetes Res Clin Pract. 2020;161:107996.