The Department of Justice (DOJ) has increased its focus on wound care services, with some prosecutions grabbing significant attention in the healthcare law community, such as January’s announced “Glam-Flam” case. In that case, the DOJ declared a first-of-its-kind federal criminal and civil enforcement targeting a wound care business that billed Medicare for what prosecutors say were improperly used and unnecessary wound care products, including human placental tissue used as skin substitute products. Although the civil proceedings are still under seal, it is estimated that the civil False Claims Act settlement has resulted in cash and assets seized by the government of more than $100,000,000.
The Glam-Flam case involved an Arizona couple and is significant as it is among the first criminal prosecutions focused on alleged fraudulent use of amniotic skin substitute products. The civil component of the government’s case ultimately resulted in a reported $309 million False Claims Act settlement, with allegations that expensive amniotic skin grafts were routinely billed to Medicare without proper medical necessity and that sales representatives and others were involved in pushing unnecessary procedures for hospice patients and similar facilities.
What the Glam-Flam Case Means for CMS Audits and Overpayments
This matter is more than an isolated headline. It reflects a broader trend where Centers for Medicare & Medicaid Services (CMS) audits and enforcement activity are focusing on wound care claims, especially those for high-value products like amniotic allografts and other skin substitutes. Medicare spending on skin substitutes rose dramatically from roughly $256 million in 2019 to more than $10 billion by 2024. CMS and the Health and Human Services (HHS) Office of Inspector General have publicly noted concerns about improper billing, waste, and abuse in this space.
In government audits and investigations, wound care claims are often selected for review based on data analytics that detect unusually high utilization, inconsistent documentation, or patterns that suggest skin substitutes are being applied without meeting Medicare’s “reasonable and necessary” standard. Providers should understand that audits may begin with relatively small sample reviews but can quickly expand to much broader claims once issues are identified.
Trends in Wound Care Enforcement
The Glam-Flam case was one of the matters spotlighted in the DOJ’s National Health Care Fraud Takedown, a major nationwide effort in 2025 where prosecutors charged more than 300 defendants in schemes involving more than $14 billion in alleged fraudulent claims. That takedown expressly included cases involving fraudulent billing for wound care products such as amniotic allografts, which, according to the DOJ, were often applied in circumstances without proper coordination with treating physicians or clinical necessity.
Other high-profile settlements and enforcement actions in the wound care space include multimillion-dollar False Claims Act resolutions with providers accused of billing for surgical procedures that lacked medical necessity and improperly configured electronic medical records that defaulted to higher-paid codes. These cases show that enforcement is not limited to amniotic products alone but extends across wound care services.
Compliance and Documentation Are Critical
The central lesson for wound care providers is that documentation must clearly support the clinical decision to use a skin substitute, allograft, grafting procedure, or other wound care service. Medicare’s coverage criteria require that services be reasonable and necessary, supported by detailed wound assessments, prior treatment efforts, and unequivocal medical indication. Generic progress notes, templated language, or charts that do not clearly explain clinical reasoning and wound specifics will not shield providers in an audit.
Accuracy in coding and billing is equally important. Allegations of overbilling, incorrect use of modifiers, or systemic defaults in billing software are all areas that government auditors and enforcement teams scrutinize when they assess whether claims should be repaid or referred for further action.
It Starts at the Production Phase
When a CMS audit letter or overpayment demand arrives, providers benefit by responding timely, completely, and in conjunction with legal counsel to minimize exposure. Early internal reviews can identify potential documentation or coding gaps that may need to be addressed during the appeals process. In cases where overpayment demands are excessive or unsupported by the record, strong legal responses can preserve appeal rights and prevent future extrapolations.
Early engagement with counsel who understand wound care coverage rules, CMS audit mechanisms, and federal enforcement strategy is essential to mitigating exposure. Producing insufficient documentation can result in overpayment demands, while overproducing unnecessary documentation may also increase exposure Frier Levitt’s attorneys can help with the production of records to ensure the audit starts off on the right foot.
Contact Frier Levitt Today
The Glam-Flam wound care case did more than make legal headlines. It crystallized the government’s intention to crack down on improper wound care billing and reinforced its ongoing pursuit of both civil and criminal remedies when it believes there has been abuse of Medicare billing. Providers that treat chronic wounds, use skin substitutes, and perform grafting procedures face heightened risk under current audit and enforcement priorities, as the government is known for casting a wide net.
For providers facing actions related to wound care services, early and informed legal guidance can make a critical difference in outcomes and in protecting practice viability.
If your practice is facing a CMS wound care audit, Medicare overpayment demand, or government investigation involving skin substitutes or grafting procedures, contact Frier Levitt today.
