What Wound Centers and Health Systems Need to Know About Modifiers JW & JZ
Your friend asks you to pick up a brownie. You swing by Costco, grab the only option—a giant tray—and head over. When you arrive, she tells you she only needs one small circle to fit on top of a cookie. So you cut out a perfect little round... and toss the rest of the tray.
In wound care, if you are using a skin substitute and do that, it's called wastage. And starting in 2026, it's coming straight out of your margin.
CMS is watching wastage closely. If you're using single-dose drugs or biologics that are separately payable under Medicare Part B, you're required to tell the full story on every claim.
JW reports discarded drug amounts; JZ confirms there was zero waste.
What skin substitute products is your wound center using? Does it fall under BLA or non-BLA classification? Miss it or get it wrong, and you're inviting denials you didn't plan for.
Quick Primer: BLA vs. Non-BLA
The FDA has two main paths for skin substitutes to reach the market, and Medicare treats them very differently.
BLA products went through rigorous FDA approval—clinical trials, manufacturing standards, the whole process. Think advanced biologics like living-cell tissues. Medicare treats these like drugs, and wastage can still be reimbursed.
Non-BLA products—including most amniotic, cadaveric, and synthetic skin substitutes used in everyday wound care—came to market through lighter regulatory pathways with less clinical evidence required. As of January 2026, Medicare treats these as supplies. You only get paid for what you apply. The rest is your loss.
That's why knowing your product classification isn't just a compliance detail —it's a financial one.
The Bigger Shift in 2026: Skin Substitutes Change the Game
As of January 1, 2026, most non-BLA skin substitutes are no longer treated as drugs—they're incident-to supplies. That changes everything:
This puts product sizing, utilization discipline, and documentation under a microscope. Partial use and excess waste now translate directly into cost that lives on your balance sheet.
BLA products are different—traditional JW/JZ rules still apply. Knowing the difference is not optional.
What This Means for Hospital Wound Centers
This isn't just a coding issue. It's an operational one. Product selection now impacts:
If your teams don't understand which products trigger modifiers, which don't, and how wastage must be documented, you're exposed.
Why Health Systems Feel This First
Single centers feel pain. Networks feel risk. Inconsistent practices across sites lead to:
Where Wound Care Advantage Is Already Ahead
This isn’t new to us. Our network has been preparing for this shift well before 2026. Our centers already operate with:
Expert support that keeps teams compliant without slowing care. No scrambling. No guessing. No surprises. We don’t wait for policy to hurt our partners. We plan for it.
Bottom Line
The JW and JZ modifier policy matters more than ever for hospital- based wound centers and health system networks. And if you don't know what these mean, you need to. Wastage is no longer theoretical, modifiers are no longer optional, and product decisions now come with real financial consequences. If you’re a hospital-based wound center or a health system asking, “Are we doing this right?” That’s the right question. Our experts are already answering it every day. If you need clarity, reach out. We’ll tell you exactly where you stand—and how to protect your program moving forward.
About Wound Care Advantage
Wound Care Advantage (WCA) has supported hospital-based wound care programs since 2002. The company's consultative model helps health systems transition from outsourced management contracts to clinically excellent, financially sustainable in-house operations. WCA's Luvo platform provides real-time analytics, compliance monitoring, and the Authorization Review System verification service to wound centers nationwide.
