Health Information Management

Know criteria for coverage when podiatrists use Dermagraft® tissue substitute

JustCoding News: Outpatient, October 21, 2009

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by Renee R. Hilgert, CPC

Podiatrists often run into reimbursement problems when they report the use of the tissue substitute Dermagraft®. To receive proper reimbursement, podiatrists must use this tissue substitute with certain treatments and for ulcers with specific diagnoses.

Dermagraft is a single-layer skin product derived from cryo-preserved human fibroblast.
Podiatrists use it to treat full-thickness diabetic foot ulcers that have persisted longer than six weeks and extend through the dermis, but without tendon, muscle, joint capsule, or bone exposure.

For full thickness skin ulcers, the wound base is visible and the ulcers extend through the dermis but not into the subcutaneous tissue to fascia, muscle, or bone. For partial thickness skin ulcers, the wound base is visible but the ulcers do not extend through the dermis.

Understand documentation requirements for coverage
When used for neuropathic diabetic foot ulcers, CMS considers the use of Dermagraft reasonable and necessary when the following conditions are satisfied and documented:

  • The patient has Type I or Type II diabetes mellitus
  • The patient does not have a current HbA1C reading exceeding 12%
  • The patient has adequate arterial blood supply with an ankle-brachial index of 0.65 or greater in the limb undergoing the procedure
  • Treatment is for full thickness ulcers that have been in existence for longer than six weeks
  • Treatment is for ulcers that have failed to respond to documented conservative treatment measures for longer than six weeks
  • Treatment is for ulcers located on the foot or toes that are free of infection, redness, drainage, underlying osteomyelitis, surrounding cellulitis, sinus tracts or tunnels, eschar, or any necrotic material that could interfere with the adherence of Dermagraft and the healing process

Also, podiatrists must use and document Dermagraft treatment in conjunction with the following standard conservative measures to support medical necessity:

  • Pressure-reducing footwear
  • A non-weight bearing regimen
  • Debridement of necrotic and callused tissue when necessary
  • Acceptable methods of wound care, such as saline moistened dressings

In addition, patients must have the ability to care for themselves and/or have the support system required to participate in follow-up care associated with wound treatment using Dermagraft.

Know which conditions trigger denials
CMS does not consider it medically necessary or reasonable to use Dermagraft for ulcers with any of the following conditions:

  • Cellulitis
  • Osteomyelitis
  • Necrotic ulcer
  • Draining wound
  • Bone exposed-wound bed
  • Clinically significant wound healing impairment due to uncontrolled diabetes

Dermagraft is not recommended for use on patients with known hypersensitivity to bovine products, as it may contain trace amounts of bovine proteins from the manufacturing medium and storage solution. Clinicians should also not use Dermagraft for wounds that have signs of clinical infections.

Because the application of Dermagraft, as well as any subsequently accepted similar product, is considered a physician service, physicians or non-physician providers must apply the tissue substitute. It is not acceptable for non-advance practice nurses, therapists, or medical assistants to apply it.

Recognize various codes to report
Dermagraft: HCPCS code Q4106 (Skin substitute, Dermagraft, per square centimeter).

CPT Application: Code 15365 (Tissue cultured allogeneic dermal substitute, face, scalp, eyelids, mouth, neck, ears, orbits, genitalia, hands, feet and/or multiple digits; first 100 sq cm or less, or one percent of body area of infants and children).

Modifier: -58 (Staged or related procedure or service by the same physician during the postoperative period). Report this modifier for physician services provided within the 90-day global period.

ICD-9-CM codes
Primary: 249.XX/250.XX (Secondary diabetes or diabetes mellitus)

Secondary: 707.14 (Ulcer of heel and midfoot)
                  707.15 (Ulcer of other part of foot)

Know acceptable POS codes

The following are acceptable place of service (POS) codes for the application of Dermagraft:

  • 11: Office
  • 21: Inpatient hospital
  • 22: Outpatient hospital
  • 23: Hospital emergency room
  • 24: Ambulatory surgical center
  • 31: Skilled nursing facility
  • 32: Nursing facility
  • 49: Independent clinic

Understand additional coverage requirements

  • Medicare does not recommend nor reimburse for retreatment with Dermagraft on the same ulcer within one year following the last successful or unsuccessful treatment.
  • Medicare does not cover continued reapplication of Dermagraft when the treatment is unsuccessful after two applications.
  • Medicare does not cover continued reapplication of Dermagraft for the same ulcer when satisfactory and reasonable healing progress is not noted after 12 weeks of therapy.

Editor’s note: Hilgert is an account manager with E-mail her at

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