National Wound Care Provider Agrees to $45 Million False Claims Act Settlement

On November 21, 2025, the DOJ announced that a national wound care practice and its owner had agreed to pay $45 million to resolve allegations that they violated the False Claims Act (FCA) by knowingly causing the submission of false or improper claims to the Medicare program.

Specifically, the DOJ alleges that the defendants engaged in a  “nationwide scheme” whereby they billed Medicare for surgical excisional debridement procedures that were not medically necessary and/or were improperly billed. The DOJ also alleges that the defendants’ proprietary electronic medical record (EMR) and billing software was programmed to ensure that Medicare was billed for the higher-reimbursed surgical excisional procedure, even when another less intensive procedure was performed. In addition, the press release states that the defendant physician owner pressured, trained, and provided financial incentives to his employed physicians to perform debridement procedures during as many patient visits as possible, regardless of the patient’s actual clinical need.

In addition to the FCA settlement, the defendants entered into a five-year Corporate Integrity Agreement (CIA) with the the OIG. The CIA requires a compliance program, risk-assessment process, an independent review organization (IRO) to audit claims and HIT systems, and annual certifications by company executives.

This settlement follows on the heels of several announcements making it clear that the federal government is laser focused on wound care services. In September, for example, the OIG released a report stating that Medicare Part B expenditures for skin substitutes exceeded $10B annually by end of 2024. The OIG’s report concluded that action is “urgently needed to rein in the massive increases in Medicare Part B spending for skin substitutes.” In June, when the DOJ announced its annual “healthcare fraud takedown,” it specifically noted that some of the charges were in relation to “fraudulent wound care services.”

Given the high reimbursement and sheer total number of wound care claims submitted to Medicare each year, wound care providers can be certain that government scrutiny in this space will continue well into 2026.

_____________________

The attorneys at Chilivis Grubman represent health care companies of all types sizes in connection with government investigations, False Claims Act litigation, and other related matters. If you need assistance with such a matter, please contact us today.