Dermatology practices are dealing with one of the highest prior authorization denial rates across all medical specialties. The NIH puts complex dermatology PA denials at around 51%. On top of that, CMS rolled out new skin substitute payment rules in 2026 that many practices are still trying to make sense of.
This post covers what actually changed, what common problems look like in practice and what fixes them.
What Changed for Skin Substitutes in 2026
CMS finalized two changes for skin substitutes under the 2026 Physician Fee Schedule. One took effect. One was pulled before it could.
The New Payment Rate Is Already in Effect
As of January 1, 2026, most skin substitute products are now reimbursed at a flat rate of $127.28 per square centimeter in non-facility (office) settings. This replaced the old system where payment was based on the product’s own price, which varied from product to product.
This affects wound care and grafting procedures using donor skin tissue, animal-derived materials and synthetic wound covers. If your practice bills for these procedures and has not reviewed how this rate applies to the products you use, that review is overdue.
The Coverage Rule Changes Were Withdrawn
CMS also proposed stricter documentation rules that would have required practices to show proof of failed wound care attempts, vascular health assessments and wound measurement records before a skin substitute claim would be covered.
These rules were finalized in October 2025, then pulled on December 24, 2025, after strong pushback from providers. The proposed criteria included:
- Documented standard wound care before product use
- Vascular assessment results in the patient record
- Wound measurements showing the wound was not healing
- Written clinical rationale for the specific product chosen
CMS has confirmed these criteria may return later in 2026. For now, existing coverage rules apply. This is not a resolved situation.
Why Dermatology Gets Hit Harder by Prior Authorization
The AAD reports that 60% of dermatologists have had to stop a patient visit to handle a PA request. That gives you a sense of how often these requests come in and how disruptive they are to a normal clinic day.
The reason dermatology carries such a heavy PA load is that it deals with a large volume of expensive medications, particularly for skin conditions like psoriasis, atopic dermatitis and hidradenitis suppurativa. Insurers require approval for most of these before they will pay. And every insurer has its own set of rules for what documentation they need.
Common Prior Authorization Problems in Dermatology
Step Therapy Documentation Is Missing
Most commercial insurers require a patient to have already tried at least one cheaper medication before they will approve a more expensive biologic. That history needs to be written into the clinical record. If the notes do not show what was tried, for how long and why it stopped working, the request gets denied regardless of whether the prescribing decision was correct.
Each Payer Has Different Requirements
There is no single PA format that works across all insurers. What UnitedHealthcare needs for a biologic approval is not the same as what Aetna needs for the exact same drug and diagnosis. Practices that use one standard template for all payers will keep running into mismatches.
What Gets Left Out of Submissions
The documentation gaps that cause most denials are not complicated. They are just consistently missed:
| What Payers Require | What Is Commonly Missing |
| Specific diagnosis with correct codes | Generic visit notes without the right detail |
| Record of failed prior treatments | No treatment history in the submission |
| Wound size and location | Measurements not documented |
| Skin or vascular assessment | Not part of standard note templates |
| Reason for product or drug choice | No written explanation included |
Medical coding accuracy matters here too. Choosing the wrong procedure code for a grafting or wound preparation service is one of the fastest ways to trigger a claim review.
Denials That Don’t Tell You What Went Wrong
“Not medically necessary” is the most common denial response in dermatology billing. It tells a practice almost nothing useful. The actual reason could be a missing treatment history, a code mismatch, or a documentation format the payer does not accept. Without knowing which, fixing the appeal is guesswork.
Tracking which payer is denying which procedure type and why, over time is how practices actually solve this. That is what structured denial management looks like in practice.
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TALK TO AN EXPERTPatients Drop Off When Approvals Take Too Long
Some patients simply stop following through on treatment when the wait stretches out. For biologic medications, that means going without care for a condition that needs it. For wound procedures, it can mean the wound gets worse while the authorization is still pending. These delays have real consequences beyond billing.
How to Fix Dermatology PA Denials Before They Happen
Most dermatology PA problems come from process gaps, not clinical ones. These are the changes that make a consistent difference:
- Start the authorization when the treatment is decided, not near the appointment. Biologics in particular need time. Early submission through a proper prior authorization process avoids most missed-window issues. This is especially relevant now that some payers, including Wellpoint, have added formal PA requirements for specific skin substitute codes starting in 2026.
- Build separate templates for each major payer. One format does not satisfy all insurers. Templates based on each payer’s own published criteria get through on the first attempt far more often.
- Check insurance coverage before the appointment. A skin substitute claim sent to the wrong plan type requires full resubmission. Insurance eligibility verification before the visit catches these before any documentation is prepared.
- Keep a log of every open authorization with its deadline. Approvals expire. A practice with no tracking system finds out about expired authorizations after the procedure is done, which means starting over.
- Make appeals specific. Resubmitting the same documents that caused the denial rarely works. An appeal that identifies the exact gap and fills it with clinical evidence has a much better outcome.
Billing Efficiency Is How You Actually Grow a Dermatology Practice
One question that comes up often is how can i grow my dermatology practice and most answers go straight to marketing, staff hiring, or adding new services. Those matter, but they sit on top of a revenue cycle that has to work first.
A practice losing revenue to preventable denials, expired authorizations and uncollected claims does not have a growth problem. It has a billing problem. Fixing the PA workflow, reducing denial rates and getting claims paid on the first submission are what actually free up the budget and bandwidth to grow.
That connection is easy to miss when the billing function is buried in daily admin work. But it is where most dermatology revenue leaks start.
The Role of Teledermatology in Growing Your Practice and Reaching More Patients
The role of teledermatology in growing your practice and reaching more patients is real, but it only works if the billing side keeps up.
Virtual dermatology visits are growing. Patients with chronic skin conditions who struggle to come in regularly, those in rural areas and follow-up consultations for ongoing biologic therapy are all well suited to telehealth. The reach is genuinely wider.
What practices often find out later is that teledermatology introduces its own billing and authorization requirements. The visit codes are different from in-person encounters. Prescribing a biologic during a telehealth visit still requires prior authorization from the insurer and the documentation standards apply just the same. Some payers have specific rules about which services qualify for telehealth reimbursement in dermatology and which do not.
Practices that expand into teledermatology without updating their billing workflows end up with a higher claim volume and a new category of denials to manage. The growth is real. The billing setup has to match it.
Where Dermatology Practices Stand Going Into the Rest of 2026
The flat-rate skin substitute payment is in effect. The stricter coverage rules were pulled but could return. Biologic PA requirements are not getting simpler. Teledermatology is adding a new layer to billing workflows. Practices that have not updated their processes for the current environment are absorbing preventable revenue losses.
If dermatology PA volume is pulling your billing staff away from other work, MedLife MBS handles prior authorization for specialty practices, from submission and tracking through to appeals.