Who really has skin in the game? CMS’s 2026 reset and the future of wound care

The Centers for Medicare & Medicaid Services (CMS) CY 2026 Physician Fee Schedule (PFS) Final Rule, effective Jan. 1, 2026, meaningfully changes how Medicare reimburses many cellular and tissue-based products (CTPs) used in advanced wound care. By shifting many skin substitutes from product-specific reimbursement to a more standardized, supply-style payment methodology in the physician office, CMS is resetting incentives.

For healthcare leaders, this shift is not simply a reimbursement update. It’s a practical opportunity to care for more patients, improve affordability and strengthen governance around advanced therapies—while maintaining high-quality outcomes for chronic wound patients.

A structural payment reset, and a predictable shift in site of care

The biggest near-term operational outcome is straightforward: Physician office-based CTP treatment is becoming far less viable for many products, and patients are increasingly expected to return to hospital-managed outpatient wound centers.

Manufacturers report that with incident-to supply the maximum reimbursement of $127.14 per square centimeter for CTPs in the office setting, many private practices can no longer reliably cover acquisition cost and cash-flow timing, especially when reimbursement delays may extend for months. As a result, the market is already signaling a site-of-care rebalancing.

At the same time, many manufacturers have not adjusted pricing downward to match the new office-based payment levels, in part because operating room use is typically supported under a bundled payment system, where the economic dynamics differ. That discrepancy is now forcing hard decisions in the physician office, but it also creates a clear opening for health systems to optimize value in outpatient wound centers.

What’s changing in the market, and why it isn’t all bad news

Early signals suggest a fast-moving adjustment:

• CTP utilization is dropping rapidly in hospital-owned physician groups as the office economics tighten.
• Some manufacturers have begun reducing sales coverage, including layoffs, reflecting reduced office demand.
• Many manufacturers believe patients will migrate from private physician offices into hospital-owned wound care centers, likely increasing wound center volume.
• As volume shifts, health systems should expect greater utilization of products priced below the $127.14/sq cm threshold, with many clinically strong options available at lower cost.

In other words, while the physician-office model may contract, health systems have an opportunity to deliver advanced wound care in settings that can better support consistent workflows, documentation, purchasing discipline, and outcomes tracking.

Strategic and operational implications—and where leaders can create upside

1. Patient access and treatment optionality can be preserved

   A common concern is that formulary narrowing could reduce options for high-risk patients. But there’s a more constructive reality emerging: Some manufacturers have reduced prices to meet the new reimbursement environment, and there is now a large set of quality CTP options available at more sustainable price points, including for complex and high-risk populations.

   Systems should seize this opportunity to establish stronger formulary governance, standardized pathways and clear criteria for when premium-priced products are clinically justified.

2. Product mix will be more economics-aware, without sacrificing care

   Yes, economics will influence product selection as it may not be sustainable to furnish products that cost more than the reimbursement rate. However, it also can lower costs for hospitals and patients while maintaining outcomes as wound centers can choose from many effective products at markedly lower acquisition costs.

   This raises an important enterprise question: If comparable clinical options are now available at lower prices in wound centers, organizations may want to take a fresh look at OR pricing and utilization as well, asking where variation exists and why certain products carry dramatically higher costs in surgical settings.

3. Outpatient wound centers may gain volume, and become the hub for advanced therapy

   As office-based physicians may face greater financial exposure when furnishing CTPs, including fronting the cost of CTPs and waiting months for reimbursement, office-based CTP treatment will likely (and significantly) decline. This creates a potential volume tailwind for hospital wound centers and an opportunity to refine care models around:

   • capacity planning and staffing
   • referral alignment
   • documentation and utilization management
   • standardized product selection that protects both quality and margin

A broader signal: Reimbursement changes and the market is responding

Mobile wound care providers, in particular, have been exiting the market since Jan. 1, 2026, reinforcing the direction of travel: Advanced wound care is consolidating back into settings with stronger infrastructure and financial stability.

In that sense, 2026 is not just a reset, it’s a chance for health systems to lead with value, align therapy use with evidence, and create a more sustainable model for advanced wound care delivery.