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The rules say that plans must pay for a medical service or item if regular Medicare would pay for it in this case. 
You can find this rule at 42 Code of Federal Regulations (CFR) Section 422.101. 
 
The rules state that there are currently a wide variety of bioengineered products available for soft tissue 
coverage to affect closure. These products may be derived from allogeneic, xenogeneic, synthetic sources or a 
combination of any or all of these types of materials. However, without the component of the recipients own 
distinct epithelium and cellular skin elements, permanent skin replacement or coverage by the graft cannot be 
accomplished. 
 
Autologous skin grafts, also referred to as autografts, are permanent covers that use skin from different parts 
of the individuals body. These grafts consist of the epidermis and a dermal component of variable thickness. A 
split-thickness skin graft (STSG) includes the entire epidermis and a portion of the dermis. A full thickness 
skin graft (FTSG) includes all layers of the skin. Although autografts are the optimal choice for full thickness 
wound coverage, areas for skin harvesting may be limited, particularly in cases of large burns or venous stasis 
ulceration. Harvesting procedures are painful, disfiguring and require additional wound care. 
 
Allografts which use skin from another human (e.g., cadaver) and Xenografts which use skin from another 
species (e.g., porcine or bovine) may also be employed as temporary skin replacements, but they must later be 
replaced by an autograft or the ingrowth of the patients own skin. 
 
Bioengineered Skin / Cultured Epidermal Autografts (CEA) are autografts derived from the patients own 
skin cells grown or cultured from very small amounts of skin or hair follicle. Production time is prolonged. One 
such product is grown on a layer of irradiated mouse cells, bestowing some elements of a xenograft. 
Widespread usage has not been available due to limited availability or access to the technology. 
 
Cellular and/or Tissue Based Products (CTPs), referred to as CTPs by CMS, The Current Procedural 
Terminology (CPT) and The Healthcare Common Procedure Coding Manuals, have been developed in an 
attempt to circumvent problems inherent with autografts, allografts and xenografts. These constitute biologic 
covers for refractory wounds with full thickness skin loss secondary to 3rd degree burns or other disease 
processes such as diabetic neuropathic ulcers and the skin loss of chronic venous stasis or venous hypertension. 
The production of these biologic CTPs varies by company and product, but generally involves the creation of 
immunologically inert biological products containing protein, hormones or enzymes seeded into a matrix which may provide protein or growth factors proposed to stimulate or facilitate healing or promote epithelization. A 
variety of biosynthetic and tissue-engineered CTP products marketed as Human Skin Equivalents (HSE) or 
Cellular and/or Tissue-based Products (CTP) are manufactured under an array of trade names and marketed 
for a variety of indications. All are procured, produced, manufactured, processed and promoted in sufficiently 
different manners to preclude direct product comparison for equivalency or superiority in randomized 
controlled trials. Sufficient data is available to establish distinct inferiority to human skin autografts and 
preclude their designation as skin equivalence. 
 
CTPs are classified into the following types: 
 Human skin allografts derived from donated human skin 
 Allogeneic matrices derived from human tissue (fibroblasts or membrane) 
 Composite matrices derived from human keratinocytes, fibroblasts and xenogeneic collagen 
 Acellular matrices derived from xenogeneic collagen or tissue 
Human Skin Allografts are bioengineered from human skin components and human tissue which have had 
intact cells removed or treated to avoid immunologic rejection. They are available in different forms promoted 
to allow scaffolding, soft tissue filling, growth factors and other bioavailable hormonal or enzymatic activity. 
 
Allogeneic Matrices are usually derived from human neonatal fibroblasts of the foreskin that may contain 
metabolically active or regenerative components primarily used for soft tissue support, though some have been 
approved for the treatment of full-thickness skin and soft tissue loss. Most are biodegradable and disappear 
after 3-4 weeks implantation. 
 
Composite Matrices are derived from human keratinocytes and fibroblasts supported by a scaffold of 
synthetic mesh or xenogeneic collagen. These are also referred to as human skin equivalent but are unable to be 
used as autografts due to immunologic rejection or degradation of the living components by the host. Active 
cellular components continue to generate bioactive compounds and protein that may accelerate wound healing 
and epithelial regrowth. 
 
Acellular Matrices are derived from other than human skin and include the majority of CTPs. All are 
composed of allogeneic or xenogeneic derived collagen, membrane, or cellular remnants proposed to simulate 
or exaggerate the characteristics of human skin. All propose to promote healing by the creation of localized 
intensification of an array of hormonal and enzymatic activity to accelerate closure by migration of native 
dermal and epithelial components, rather than function as distinctly incorporated tissue closing the skin defect. 
 
For the purpose of this LCD, consideration is given to the use of dermal or epidermal substitute tissue of 
human or non-human origin, with or without bioengineered or processed elements, with or without 
metabolically active elements, with a designated use as coverage for a superficial skin deficit that has persisted, 
despite optimal wound care for a period of 4 weeks or greater. These products are those referred to as Human 
Cellular and/or Tissue Based Products (CTPs). 
 
Evaluation of the clinical literature indicates that studies comparing the efficacy of CTPs to alternative wound 
care approaches with patients autologous skin are limited in number, apply mainly to generally healthy 
patients, and examine only a small portion of the CTP products available in the United States. Therefore, all 
products with FDA clearance/approval or designated 361 HCT/P exemption used in accordance with 
that products individualized application guidelines will be equally considered for the purpose of this 
LCD and may be considered reasonable and necessary. 
 
Regulatory Status 
 
US Food and Drug Administration (FDA) Governing CTP Products  
The U.S. Food and Drug Administration (FDA) does not refer to any product or class of products as skin 
substitutes. However, products commonly described as CTPs are regulated by FDA under one of the four 
categories described below depending on the origin and composition of the product and listed as a CTP . 
1. Human Cells, Tissues, and Cellular and Tissue-Based Products - Cells and tissues taken from 
human donors and transplanted to a recipient are regulated under PHS 361 [21 CFR 1270 & 1271]. This 
regulation describes the rules concerning the use of HCT/Ps for human medical purposes. The final 
rule, 21 CFR Part 1271, became effective on April 4, 2001, for human tissues intended for 
transplantation that are regulated under section 361 of the PHS Act and 21 CFR Part 1270. HCT/Ps are 
regulated by the Center for Biologics Evaluation and Research (CBER). CBER is responsible for 
regulating biological and related products including blood, vaccines, allergenics, tissues, and cellular 
and gene therapies. Establishments producing HCT/Ps must register with FDA and list their HCT/Ps. 
HCT/Ps establishments are not required to demonstrate the safety or effectiveness of their products and 
FDA does not evaluate the safety or effectiveness of these products. Products are recovered, processed, 
and distributed in compliance with FDA Good Tissue Practices and American Association of Tissue 
Banks (AATB) standards, maintain the necessary registration with the FDA, and undergo routine FDA 
inspection. 
2. Premarket Approval - Premarket approval (PMA) by FDA is the required process of scientific review 
to ensure the safety and effectiveness of Class III devices. Before Class III devices can be marketed, 
they must have an approved PMA application. Therefore, wound care products regulated under the 
PMA process will require evidence that they promote wound healing before they are approved for 
marketing. 
3. 510(k) Submissions - According to FDA documents a 510(k) is a premarket submission made to FDA 
to demonstrate that the device to be marketed is at least as safe and effective, that is, substantially 
equivalent (SE), to a legally marketed device (21 CFR 807.92(a)(3)) that is not subject to PMA." 
Submitters must compare their device to one or more similar legally marketed devices and make and 
support their substantial equivalency claims. Unlike PMA, 510(k) confers reasonable assurance of 
safety and effectiveness via demonstration of substantial equivalence to a legally marketed device that 
does not require premarket approval. Therefore, wound care products regulated under the 510(k) 
process will not typically require clinical evidence to establish effectiveness in wound healing, as 
compared with products regulated under the PMA process in which substantial clinical evidence is 
always required. 
4. Humanitarian Device Exemption - An HDE is similar in both form and content to a premarket 
approval (PMA) application but is exempt from the effectiveness requirements of a PMA. An HDE 
application is not required to contain the results of scientifically valid clinical investigations 
demonstrating that the device is effective for its intended purpose. The applicant must demonstrate that 
no comparable devices are available to treat or diagnose the disease or condition, and that they could 
not otherwise bring the device to market. HDE approval is based on evidence of probable benefit in a 
disease population occurring at a frequency of less than 4,000 patients per year in the United States. 
 
Updated designation and approved usage criteria may be found at 
http://www.fda.gov/MedicalDevices/ProductsandMedicalProcedures/DeviceApprovalsandClearances. 
 
Expanded classification criteria and explanation is included in the HHS/AHRS Final Report, December 
18, 2012, entitled Skin Substitutes for Treating Chronic Wounds. 
 
Per the American Medical Association and the CPT Manual, Skin Replacement Surgery or Skin Substitute 
Grafting is a conceptual model focusing on the work and services provided regardless of the product used. 
This removes the requirement for maintenance and education on the use of supply codes that have little impact 
on the "typical patient" or the provider effort for application of the product. The application of CTP is distinguished according to the wound characteristics and surface area rather than by product description. 
Currently, no product has demonstrated individual superiority for the treatment of diabetic foot ulcers (DFU) 
and venous leg ulcers (VLU) of the lower extremity, and, frequently such products are utilized inappropriately. 
 
Non-graft wound dressings are generally included in standard wound care management; such products may 
provide value and, in fact, may preclude the need for CTP application. 
 
Standard treatment of chronic lower extremity ulcers or skin loss (e.g., DFU or VLU) primarily includes 
infection and edema control, mechanical offloading, mechanical compression or limb elevation, debridement of 
necrotic or infected tissue, and management of concomitant and inciting medical issues (blood glucose control, 
tobacco use). Maintenance of a therapeutic environment with appropriate dressings to preclude further trauma 
facilitates development of healthy granulation tissue and encourages re-epithelialization. A wound that fails to 
show evidence of healing by contraction and advancement of epithelial margins following 4 weeks of 
optimization, including all aspects of standard therapy, is considered a chronic non-healing wound and falls 
into the auspices of this LCD. The fundamental basis for non-healing of a wound is of paramount importance 
and must be corrected prior to consideration of additional therapy. 
 
The depth of skin loss is the determinant of its ability to return. Full thickness skin loss, implying the loss of all 
elements of the epidermis and dermis, will require re-epithelization of the surface once a clean granular base is 
established. Both full and partial thickness skin loss may benefit from enhanced products referred to as CTPs. 
Though no CTPs are capable of replacing the patients own skin, they have been demonstrated to allow 
scaffolding for the growth of epithelium, enzymatic cleansing and provision of growth factors beneficial to 
deficit reduction and re-epithelization. 
 
This document addresses the management of chronic non-healing wounds or skin deficits of the lower 
extremities with the goal of wound and skin closure when standard or conservative measures have failed. While 
lower extremity ulcers have numerous causes such as burns, trauma, immobility, ischemia or other neurologic 
impairment, over 90% of the lesions are related to venous stasis disease and diabetic neuropathy. Therefore, the 
focus of this policy is the application of bioengineered skin substitute material to diabetic foot ulcers and 
venous leg ulcers of the lower extremities and the reasonable and necessary (R&N) threshold for utilization of 
CTPs. Particular emphasis is placed on the indications for application of CTP material for DFU and VLU. 
 
Patients receiving a CTP graft must be under the care of a physician licensed by the state with full scope of 
practice for the treatment of the systemic disease process(s) etiologic for the condition (e.g., venous 
insufficiency, diabetes, neuropathy). If the provider performing the CTP graft/application is not the one 
providing the treatment for the systemic condition, then a statement in the documentation that (s)he is aware of 
the systemic condition and that the patient is under the care of Doctor _____. This concurrent medical 
management and the identity of the managing medical physician shall be clearly discernable in the medical 
record and available upon request. 
 
Medicare coverage for wound care on a continuing basis, for a single wound, in an individual patient is 
contingent upon evidence documented in the patients medical record that the wound is improving in response 
to the wound care being provided. Since it is neither reasonable nor medically necessary to continue a given 
type of wound care in the absence of wound improvement, it is expected that the wounds response to treatment 
will be documented in the medical record at least once every 30 days for each episode of wound treatment and 
made available to the contractor upon request. 
 
Documentation of response requires measurements of the initial ulcer, measurements at the completion of at 
least four weeks of appropriate wound care and measurements immediately prior to placement and with each 
subsequent placement of the CTP. 
 
 Definitions per CPT: 
 
Autografts/tissue cultured autografts: Include the harvest or application of an autologous skin graft. 
 
CTP grafts: Include non-autologous human cellular and/or tissue products (e.g., dermal or epidermal, cellular 
and acellular, homograft or allograft), non-human cellular and/or tissue products (i.e., xenograft), and 
biological products (synthetic or xenogeneic) that are applied in a sheet over an open wound to augment wound 
closure or skin growth. 
 
Indications: 
 
Chronic Wounds are defined as wounds that do not respond to standard wound treatment for at least a 30 day 
period during organized comprehensive conservative therapy. 
 
For all wounds, documentation (as outlined in the documentation requirements of the policy) and a 
comprehensive treatment plan, before initiation of a specialized wound therapy product is required. 
 
For purposes of this LCD a Failed Response is defined as an ulcer or skin deficit that has failed to respond to 
documented appropriate wound-care measures, has increased in size or depth, or has not changed in baseline 
size or depth and has no indication that improvement is likely (such as granulation, epithelialization or progress 
towards closing). 
 
Medicare covers application of CTPS to Ulcers or Wounds with Failed Response that are: 
 Partial- or full-thickness ulcers, not involving tendon, muscle, joint capsule or exhibiting exposed bone 
or sinus tracts, with a clean granular base unless the CTP package label indicates the CTP is approved 
for use involving tendon, muscle, joint capsule or exhibiting exposed bone or sinus tracts, with a clean 
granular base ; 
 Skin deficit at least 1.0 cm2 in size; 
 Clean and free of necrotic debris or exudate; 
 Have adequate circulation/oxygenation to support tissue growth/wound healing as evidenced by 
physical examination (e.g., Ankle-Brachial Index (ABI) of no less than 0.60, toe pressure > 30mm Hg); 
 For diabetic foot ulcers, the patients medical record reflects a diagnosis of Type 1 or Type 2 Diabetes 
and also reflects medical management for this condition. 
 
Wound healing is impaired by the systemic use of tobacco. Therefore, ideally patients who have smoked will 
have ceased smoking or have refrained from systemic tobacco intake for at least 4 weeks during conservative 
wound care and prior to planned bioengineered skin replacement therapy. 
 
Documentation (in the pre-service record) specifically addressing circumstances as to why the wound has 
failed to respond to standard wound care treatment of greater than 4 weeks and must reference specific 
interventions that have failed. Such record should include updated medication history, review of pertinent 
medical problems that may have occurred since the previous wound evaluation, and explanation of the planned 
skin replacement surgery with choice of CTP graft product. The procedure risks and complications should also 
be reviewed and documented. Documentation of smoking cessation counseling and cessation measures 
prescribed, if applicable, must also be documented in the patient's record. 
 
Application of a CTP graft for lower extremity chronic wound (DFU and VLU) will be covered when the 
following conditions are met for the individual patient:  Presence of neuropathic ulcers and diabetic foot ulcer(s) having failed to respond to documented 
conservative wound-care measures of greater than four weeks, during which the patient is compliant 
with recommendations, and without evidence of underlying osteomyelitis or nidus of infection. 
 Presence of a venous stasis ulcer for at least 3 months but unresponsive to appropriate wound care for at 
least 30 days with documented compliance. 
 Presence of a full thickness skin loss ulcer that is the result of abscess, injury or trauma that has failed to 
respond to appropriate control of infection, foreign body, tumor resection, or other disease process for a 
period of 4 weeks or longer. 
 
In all wound management the ulcer must be free of infection and underlying osteomyelitis with 
documentation of the conditions that have been treated and resolved prior to the institution of CTP 
therapy. For purposes of this LCD, appropriate therapy includes, but is not limited to: 
o Control of edema, venous hypertension or lymphedema 
o Control of any nidus of infection or colonization with bacterial or fungal elements 
o Elimination of underlying cellulitis, osteomyelitis, foreign body, or malignant process 
o Appropriate debridement of necrotic tissue or foreign body (exposed bone or tendon) 
o For diabetic foot ulcers, appropriate non-weight bearing or off-loading pressure 
o For venous stasis ulcers, compression therapy provided with documented diligent use of 
multilayer dressings, compression stockings of > 20mmHg pressure, or pneumatic compression 
o Provision of wound environment to promote healing (protection from trauma and contaminants, 
elimination of inciting or aggravating processes) 
Limitations: 
 
Due to the propensity for misuse of CTP products, reimbursement may be made only when the medical record 
clearly documents that these products have been used in a comprehensive, organized wound management 
program. All listed products, unless they are specifically FDA-labeled or cleared for use in the types of 
wounds being treated, will be considered not reasonable and necessary, therefore not eligible for 
reimbursement. 
 Partial thickness loss with the retention of epithelial appendages is not a candidate for grafting or 
replacement, as epithelium will repopulate the deficit from the appendages, negating the benefit of over 
grafting 
 CTP grafts will be allowed for the episode of wound care in compliance with FDA guidelines for the 
specific product (see utilization guidelines) not to exceed 10 applications or treatments. In situations 
where more than one specific product is used, it is expected that the number of applications or 
treatments will still not exceed 10 
 Simultaneous use of more than one product for the episode of wound is not covered. Product change 
within the episode of wound is allowed, not to exceed the 10-application limit per wound per 12 week 
period of care. 
 Treatment of any chronic skin wound will typically last no more than twelve (12) weeks. 
 Repeat or alternative applications of skin substitute grafts are not considered medically reasonable and 
necessary when a previous full course of applications was unsuccessful. Unsuccessful treatment is 
defined as increase in size or depth of an ulcer or no change in baseline size or depth and no sign of 
improvement or indication that improvement is likely (such as granulation, epithelialization or progress 
towards closing) for a period of 4 weeks past start of therapy. 
 Retreatment of healed ulcers, those showing greater than 75% size reduction and smaller than .5 sq.cm, 
is not considered medically reasonable and necessary. 
 Skin substitute grafts are contraindicated and are not considered reasonable and necessary in patients 
with inadequate control of underlying conditions or exacerbating factors (e.g., uncontrolled diabetes, 
active infection, and active Charcot arthropathy of the ulcer extremity, vasculitis or continued tobacco 
smoking without physician attempt to effect smoking cessation).  CTP grafts are contraindicated in patients with known hypersensitivity to any component of the CTP 
graft (e.g., allergy to avian, bovine, porcine, equine products). 
 Repeat use of surgical preparation services in conjunction with CTP application codes will be 
considered not reasonable and necessary. It is expected that each wound will require the use of 
appropriate wound preparation code at least once at initiation of care prior to placement of the CTP 
graft. 
 Re-treatment within one (1) year of any given course of CTP treatment for a venous stasis ulcer or 
(diabetic) neuropathic foot ulcer is considered treatment failure and does not meet reasonable and 
necessary criteria for re-treatment of that ulcer with a CTP procedure. 
CMS has guidance regarding other specialized wound treatment technology and specifically addresses platelet 
rich plasma systems (e.g., Autologet, Magellan); negative pressure wound therapy devices and electro-
magnetic/ultrasound/mist therapies. They are not addressed in this LCD as their role in the treatment of the two 
major types of lower extremity wounds discussed here is limited. Utilization remains at the providers 
discretion and must be reasonable and necessary. Note that combination therapy with any CTP will be 
considered not reasonable and necessary. 
 
Please Note: Autologous Platelet Rich Plasma (PRP) systems used in the treatment of Chronic Non-
Healing Wounds is not considered reasonable and necessary except as described in National Coverage 
Determination (NCD) for Blood-Derived Products for Chronic Non-Healing Wounds (270.3). Please 
refer to the NCD for coverage details. 
 
As published in CMS IOM 100-08, Chapter 13, Section 13.5.1, in order to be covered under Medicare, a 
service shall be reasonable and necessary. When appropriate, contractors shall describe the circumstances 
under which the proposed LCD for the service is considered reasonable and necessary under Section 
1862(a)(1)(A). Contractors shall consider a service to be reasonable and necessary if the contractor determines 
that the service is: 
 Safe and effective. 
 Not experimental or investigational (exception: routine costs of qualifying clinical trial services with 
dates of service on or after September 19, 2000, that meet the requirements of the Clinical Trials NCD 
are considered reasonable and necessary). 
 Appropriate, including the duration and frequency that is considered appropriate for the service, in 
terms of whether it is: 
o Furnished in accordance with accepted standards of medical practice for the diagnosis or 
treatment of the patients condition or to improve the function of a malformed body member. 
o Furnished in a setting appropriate to the patients medical needs and condition. 
o Ordered and furnished by qualified personnel. 
o One that meets, but does not exceed, the patients medical needs. 
o At least as beneficial as an existing and available medically appropriate alternative. 
You can find this rule at the Medicare Local Coverage Determination (LCD) L36690: Wound Application of 
Cellular and/or Tissue Based Products (CTPs), Lower Extremities. 
 
If you want to read these Medicare rules, you can go to this website www.medicareappeal.com. 
 
The Plan contract says that the Plan covers items and services in accordance with Medicare rules.