Wound Care Compliance

Healthcare Providers that Offer Wound Care Services Must Strictly Comply with All Applicable Regulatory Standards

Maintaining compliant billing practices is critical for healthcare providers that offer wound care and wound management services. Failure to consistently maintain and demonstrate compliance can expose providers to substantial liability (among other consequences) in the event of an audit or investigation.  

Wound care billing has become a priority enforcement area for federal healthcare authorities. With Medicare billings for wound care increasing by 640% from 2023 to 2025, federal authorities are paying close attention to providers that bill for wound assessments and wound care services.

From documentation gaps related to medical necessity to coding errors related to billing for patient care, all types of compliance failures can expose providers to liability for fines, recoupments, and treble damages. Significant compliance gaps can also result in Medicare and Medicaid suspensions (or exclusion) in some cases. As a result, strict adherence to all pertinent statutory and regulatory requirements is essential—as is maintaining high documentation standards that will allow for successful defense against a CMS audit or federal investigation if necessary.

Core Elements of Wound Care Compliance

There are several aspects of wound care compliance that require careful attention when billing Medicare and Medicaid. Wound care clinics, skilled nursing facilities, and other providers need to maintain comprehensive and custom-tailored compliance programs focused on their specific needs. Broadly, some of the core elements of wound care compliance include:

• Ensuring the medical necessity of all wound care services provided
• Ensuring that all services are provided by physicians or other licensed healthcare professionals
• Properly billing for skin substitutes and grafts
• Properly billing for clinical support, durable medical equipment (DME), and other third-party items and services
• Maintaining consistent documentation of compliance

All providers that bill for wound care services (and related equipment and supplies) must ensure compliance with the current rules enforced by the Centers for Medicare and Medicaid Services (CMS). These rules change frequently, and complying with outdated rules does not excuse non-compliance with the current CMS billing requirements following regulatory changes.

Essential Documentation: Elements of an Effective Wound Care Compliance Program

Wound care providers need several forms of documentation—not only for effectively managing compliance, but also for ensuring that they are prepared to respond quickly in the event that they face scrutiny from a CMS audit contractor or the U.S. Department of Health and Human Services Office of Inspector General (HHS OIG). Essential forms of compliance documentation include:

1. Compliance Policies and Procedures

Wound care providers should work closely with their legal counsel to develop comprehensive and custom-tailored compliance policies and procedures. They should document their specific compliance needs, and then they should address these needs taking into account the unique aspects of their operations.

The importance of taking a custom-tailored approach to developing wound care compliance policies and procedures cannot be overstated. If wound care providers do not assess their specific needs, they will not be able to address all relevant factors. This can result in compliance gaps that will pose significant risks for unfavorable outcomes in the future.

2. Chief Compliance Officer Duties

Wound care providers should appoint a Chief Compliance Officer to lead their compliance efforts. Chief Compliance Officers can be clinicians or other practitioners, or they can devote 100% of their time and effort to overseeing providers’ compliance operations. Here too, what is necessary will depend on each individual provider’s specific risks and needs.

Chief Compliance Officers’ duties should reflect not only the types of wound care services offered, but also the specific program (or programs) that a provider bills for reimbursement. While a Chief Compliance Officer does not need to review every single wound care-related reimbursement request, a Chief Compliance Officer should have broad oversight and deep insight into a provider’s billing practices.

3. Training Materials and Completion Records

Each member of a wound care provider’s team should receive compliance training that is tailored to the team member’s role within the organization. Education is essential for maintaining compliance (in addition to protecting patient safety) on an ongoing basis. For example, clinical personnel should generally generate documentation of wound measurements at every visit. Without this documentation, providers won’t be able to select the correct billing codes, and they won’t be prepared to affirmatively demonstrate compliance if necessary.

4. Internal Audit Records

Wound care providers should conduct periodic audits (either annually or quarterly depending on their specific needs), and they should document their audit findings. Annual or quarterly internal audits can help catch billing and documentation errors before external reviews, and documenting providers’ audits can assist with demonstrating a good-faith commitment to compliance.

5. Documentation of Ongoing Compliance Efforts

Along with documenting their internal audits, wound care providers should document their other ongoing compliance efforts as well. Wound care audits have increased in recent years due to perceived high compliance risks in this area. When facing a UPIC, ZPIC, or HHS OIG audit focused on suspected wound care fraud, being prepared to affirmatively demonstrate compliance can be critical for avoiding unnecessary consequences.

Understanding the Risks of Non-Compliance for Wound Care Providers

For non-compliant providers, the risks of facing scrutiny from a Medicare contractor or the HHS OIG can be substantial. Medicare contractors and HHS OIG investigators have recently been scrutinizing wound care billings more closely than other types of billings, and a single quarter of questionable documentation can trigger six-figure repayment obligations for many providers. Allegations of Medicare or Medicaid billing fraud can lead to suspension or revocation of billing privileges as well.

If auditors or investigators find evidence which suggests intentional fraud, criminal charges could also be on the table. As a result, the need to effectively manage wound care compliance cannot be ignored. By implementing daily documentation practices and conducting periodic reviews to assess compliance, providers can reduce their risk of facing wound care claim denials (and other adverse consequences) significantly.

FAQs: Effectively Managing Wound Care Compliance

What are some of the key aspects of wound care compliance when billing Medicare or Medicaid?

Wound care compliance is essential for both patients and healthcare providers. Compliance can directly influence the healing process—and providers’ compliance obligations are intended, in part, to promote patient safety (i.e., by preventing medically unnecessary procedures).

Providers’ compliance obligations are also intended to protect taxpayers. Medicare and Medicaid fraud are major issues, and the HHS OIG has noted a rise in wound care-related fraud in recent years. As a result, along with ensuring medical necessity, providers must ensure that they strictly comply with CMS’s billing rules and regulations as well.

What pitfalls do wound care providers need to avoid when billing for treatment of pressure ulcers?

Wound care providers need to avoid several pitfalls when billing for treatment of pressure ulcers. For example, upcoding and unbundling are common issues that can lead to recoupments and other penalties. Providers must ensure that they correctly bill for the correct services, and they must also identify the correct patient and the correct coverage.

Another common pitfall is failing to maintain adequate compliance documentation. Even if a provider’s program billings are compliant, if the provider cannot prove that they are compliant, the provider can still face liability in the event of a CMS audit or criminal healthcare fraud investigation.

Do I need to engage a law firm to help with developing and implementing a wound care compliance program?

Yes, engaging a law firm to assist with developing and implementing an effective wound care compliance program is strongly recommended. As discussed above, a custom-tailored approach is critical. Providers that lack a clear and comprehensive understanding of their compliance obligations cannot address these obligations effectively—and this can leave them exposed to various allegations of non-compliance.

What should I do if I have concerns about wound care billing compliance?

If you have concerns about wound care billing compliance, you should consult with an experienced federal healthcare compliance lawyer promptly. While all forms of billing non-compliance can pose serious risks for healthcare providers, the federal government has been prioritizing wound care compliance enforcement in recent years. If your practice is not in compliance, it will be important to address all outstanding issues as soon as possible.

What should I do if a CMS auditor or the HHS OIG audits my practice’s wound care billings under Medicare or Medicaid?

When facing an audit related to your practice’s wound care billings, it is imperative to immediately engage experienced defense counsel. These are high-risk audits, and they are often extremely invasive. Avoiding unnecessary consequences will require an informed and strategic approach, and this means that you need a highly experienced defense team on your side.

Speak with a Federal Healthcare Compliance Lawyer at Oberheiden P.C.

If you would like to speak with a federal healthcare compliance lawyer at Oberheiden P.C. about wound care billing compliance, we invite you to get in touch. We represent providers that are facing wound care fraud allegations as well. To get started with a complimentary initial consultation, please call 888-680-1745 or tell us how we can help online today.