Billing and Coding: Application of Skin Substitute Grafts for Treatment of DFU
and VLU of Lower Extremities

This Billing and Coding Article provides billing and coding guidance for Local
Coverage Determination (LCD) L36377 Application of Skin Substitute Grafts for
Treatment of DFU and VLU of Lower Extremities. Please refer to the LCD for
reasonable and necessary requirements.

**Coding Guidance**

**Notice:** It is not appropriate to bill Medicare for services that are not
covered (as described by the entire LCD) as if they are covered. When billing
for non-covered services, use the appropriate modifier.

Per the Current Procedural Terminology (CPT) definition, skin substitute
grafts include non-autologous skin (dermal or epidermal, cellular and
acellular) grafts (e.g., homograft, allograft), non-human skin substitute
grafts (i.e., xenograft), and biological products that form a sheet
scaffolding for skin growth. Skin substitute graft codes are not to be
reported for application of non-graft wound dressings (e.g., gel, powder,
ointment, foam, liquid) or injected skin substitutes.

Non-graft wound dressings or injected skin substitute codes are not used with
skin replacement surgery application codes and are considered incorrect
coding. Such products are bundled into other standard management procedures if
medically necessary and not separately payable.

Application procedure and associated supply must be coded correctly. The units
of service must be reported correctly. The units of service billed for the
supply must be accounted for in the medical record (i.e., amount used, amount
discarded and reason for the discarded amount).

Removal of current graft and/or simple cleansing of wound is included in the
skin replacement surgery application codes. Active wound care management (CPT
code 97602) procedures should never be reported.

**Documentation Requirements**

  1. All documentation must be maintained in the patient's medical record and made available to the contractor upon request.
  2. Every page of the record must be legible and include appropriate patient identification information (e.g., complete name, dates of service[s]). The documentation must include the legible signature of the physician or non-physician practitioner responsible for and providing the care to the patient.
  3. The submitted medical record must support the use of the selected ICD-10-CM code(s). The submitted CPT/HCPCS code must describe the service performed. 
  4. The medical record must clearly show that the criteria listed in the LCD has been met, as well as, the appropriate diagnosis and response to treatment. Description of the wound(s) must be documented at baseline (prior to beginning conservative wound care measures) relative to size, location, stage, duration, and presence of infection, in addition to the type of treatment given and response. This information must be updated in the medical record throughout the episode of skin replacement surgery wound care. Wound description must also be documented pre- and post- treatment with the skin substitute graft being used. The reason(s) for any continued application should be specifically addressed in the medical record.
  5. Documentation should include an assessment (generally in an E/M service) outlining the plan for skin replacement surgery and the choice of skin substitute product for the 12 week period as well as any anticipated repeat applications in the 12 week period. An operative note must support the procedure (e.g., application of skin substitute graft to legs) for the relevant date of service (first application starts the 12 week episode of care). At a minimum, the operative note(s) should include pre and post op diagnosis, name of surgeon, anesthesia, reason for the procedure, complete description of the procedure including product used (with identifying package label in the chart), and relevant findings. 
  6. Any amount of wasted skin substitute must be clearly documented in the procedure note with the following minimum information: Date, time and location of ulcer(s) treated; Name of skin substitute and how product supplied; Approximate amount of product unit used; Approximate amount of product unit discarded; Reason for the wastage; Manufacturer's serial/lot/batch or other unit identification number of graft material. When manufacturer does not supply unit identification, record must document such.
  7. Documentation requirements include addressing how product supplied, any wastage, etc. The HCPCS code of the applicable skin substitute and the units billed must be consistent with medical record in regard to wound description and size.