Implementation of Three Unexpected CTP 2026 Medicare Payment Changes: Part 3

• Medicare, CTPs, effective January 1, 2026 (physicians/QHPs, hospital outpatient departments): No payment for discarded portions. Report and bill only square centimeters applied; wastage must be documented but not billed.

• Billing changes: Remove JW/JZ modifiers from systems; ensure charges are per square centimeter, not per sheet. Capture applied cm² in EHR, chargemaster, and claims to align documentation with billing.

• Operational steps: Measure wound each encounter; purchase correct size CTP to minimize waste; document applied and wasted cm²; audit claims to confirm applied amounts match medical record and claim form.

Please note: This content is a direct transcript, capturing the authentic conversation without edits. Some language may reflect the flow of live discussion rather than polished text. 

Welcome to CTP News Desk, “Implementation of Three Unexpected CTP 2026 Medicare Payment Changes.” This is going to be a three-part series. And in the first part, we've already talked about one expected change was the same allowable rate for all brands of CTP sheets. In the part two, we talked about the exceptions to the CTP Medicare payment rate of $127.14 per square centimeter. And today, in the third part, we're going to talk about the fact that there will be no Medicare payment for CTP wastage. 
 
I have been talking to people about getting ready for these changes for the last couple of years, and some people have taken my advice and gotten ready for it, and other people have listened to others who say, "Oh, no changes are going to happen. Just keep on doing what you're doing." Well, we know that we have had changes, and now we have to be sure we adjust our processes in order to accommodate those changes.
 
My name is Kathleen Schaum, and I'm the founder and president of Kathleen D. Schaum & Associates, Inc. And I'm very excited to be here with you today to talk about the part three of the unexpected payment change, the fact that there will be no Medicare payment for CTP wastage. And therefore, you may have to refine your business model and your revenue cycle processes so that you do not charge Medicare for the CTP wastage. 
 
Now, let's talk about this. Physicians and QHPs should not report wasted portions of CTPs on their Medicare claims. Prior to 2026, if they purchased the product and they applied the CTPs, the physicians and QHPs were required to document and separately report the number of square centimeters they applied and the number of square centimeters they wasted. And they needed to do that both in the medical record, excuse me, as well as on their Medicare claim forms. And they were paid for the entire piece. Now, effective January 1, Medicare is no longer going to pay physicians and QHPs for the discarded portions of their CTPs. That means it's extremely important that our physicians and QHPs purchase the right size product to minimize wastage. They need to measure, document, and report the number of square centimeters they applied, and they need to document the number of square centimeters they wasted, but they're only going to report the number of square centimeters that they applied to the wound.
 
Now, that application is applying the product over the entire wound surface, up over the wound edges, and onto the healthy skin so that they can secure it. Now, because the fact that they had been reporting the wastage on a separate line item, most of the systems have had a modifiers of JW and JZ. In the past, if you used it all, you applied the JZ modifier to the code. If you applied part of it, you applied the JW to the part it was wasted, but now you need to remove JW and JZ from your billing systems so that you don't make any mistakes and so that a code or a biller doesn't start to apply those codes to your CTP codes. And you need to verify that in your system, your charges are per square centimeter, not per sheet, because if you have your charge set per sheet and you have to report only the portion that you used, you won't have the charges set up right. So it's very, very important that you check and be sure your EHR, your charge description master, and your coding and billing systems have charges in per square centimeter, not per sheet. So that's what our physicians and QHPs have to do. 
 
Now, our hospital outpatient departments, the physicians always had to report how much they applied, how much they wasted when they did the work in the outpatient department. And so that showed up in the medical record of the outpatient department, but the outpatient departments were not required to report how much was applied and how much was wasted on their claim forms because in the past, the product was packed inside the application code. So the medical record didn't have any record of exactly how much was applied and how much was wasted. They only had the application code. But effective January 1, as we talked about in part one, our outpatient departments are now paid separately for the products and the application rate.
 
So it's extremely important that our outpatient departments start to think about this and start to think, how are they going to be sure their system captures the information? First, they need to purchase the right size product to minimize the waste. And then once the product has been applied over the whole wound surface, up over the edges and onto the healthy skin, so it can be secured. And whatever is wasted has to be calculated so that you will know and only charge for that which you applied. And again, be sure the charges in your system are per square centimeter, not per each, because you have to be reporting this per square centimeter. So you need to refine your EHR so you can report it. You need to refine your charge description master, your coding and billing systems so that you capture and report the number of square centimeters that it's applied.
 
Now I have to tell you, it's made me a little bit crazy since January 1 when I see everybody is all fussed up about this measuring how much is wasted as if this is a new thing. We have had to document—this is a procedure. We have to document what we buy, how much we apply, how much we waste it. And we've had to do that for years. In fact, for decades, nearly every national coverage determination, local coverage determination, and local coding and billing article requires us to measure the wound and document the size of the wound, and then to report any procedure we do. And when the procedure is to apply a CTP, we've had to report the amount that we applied and the amount that was wasted. So this is not new, all right? 
 
And if somebody is having a hard time measuring their wound, there's plenty of ways to measure. There's digital and all kinds of ways to measure the wound correctly, but this is not necessarily about the measurement of the wound. It's the measurement of what is not applied to the wound, the product that's not applied to the wound, so that you know how much you did apply. So be sure you refine your EHR, you certainly get the right measuring tool to measure your wounds, but most importantly, you need to be sure you are able to calculate how much you applied because that's what you are going to report onto your claim forms. 
 
So there's seven important things you need to do. Number one, of course, you're going to correctly measure and document the size of your wound or ulcer at each encounter. You're going to purchase the correct size of the CTP for each wound or ulcer. You're going to document the total number of square centimeters applied and wasted. And you're going to capture the total number of square centimeters applied in your coding and billing system. You're going to establish a per square centimeter charge, not a per piece charge, and then you're going to report on your Medicare claims the total number of square centimeters applied and the total charges for those square centimeters.
 
And most important, my friends, since this is relatively new to you, it's extremely important that you audit your own claims. Look at the documentation, look at how much that has been documented was applied. Then be sure that that dropped onto the claim correctly and that some coder or biller didn't change those for you. You want to be sure that what you applied is in the medical record and is going to be reported on the claim form. So very important. I can't tell you how bad this is going to be if you have an audit where something's in the documentation does not match up what is on the claim form. And remember, what you're not necessarily talking about is you're not talking about the size of the wound, you're talking about how much was applied. 
 
With that, I want to thank you for allowing me to share tips for refining your business model and your revenue cycle processes by not billing Medicare for the wasted portions of CTPs. I hope this three-part series has provided some useful tips for implementation of all three of the unexpected CTP 2026 Medicare payment changes. Thank you for listening.

Kathleen D. Schaum is a reimbursement strategy and education consultant to the wound/ulcer management industry. She has over 50 years of experience training professionals, executives, sales representatives, and investors how services, procedures, and products are reimbursed in various places of service.