Medicare expenditures on costly wound coverings known as skin substitutes surged to over $10 billion in 2024, marking one of the largest identified instances of potential waste in the federal health program’s recent history. The Justice Department announced charges against five individuals tied to multiple kickback schemes that profited manufacturers and healthcare providers involved in the use of these products.
Among those charged is Brian Rowan, vice president of sales at Legacy Medical Consultants, a Fort Worth, Texas-based company that earned at least $2.6 billion from Medicare for skin substitutes. Rowan was arrested on allegations of offering illegal kickbacks, bribes, and rebates to healthcare providers who used Legacy Medical’s products. According to charging documents, Rowan instructed doctors to submit Medicare claims for the full list prices of the skin substitutes while concealing substantial rebates. The government alleges Rowan earned $24 million through the fraud, using some of the proceeds to purchase luxury goods including a $47,000 Rolex watch and a million-dollar life insurance policy.
The documents detail how Rowan helped set up shell companies to funnel kickbacks from manufacturers to providers, with deposits reportedly reaching as high as $71 million. He is the first executive from the skin substitute industry to face criminal Medicare fraud charges.
Separately, the Justice Department charged Nevada nurse practitioner Marizel Yukee with receiving and distributing kickbacks related to skin substitute use. Yukee owned a network of wound care clinics to which she allegedly paid providers for patient referrals, leading to unusually high Medicare billings—sometimes exceeding $1 million in skin substitute claims per patient. Prosecutors estimate Yukee received $297 million from fraudulent claims. The government contends that some treatments were applied to patients in hospice or terminal stages, casting doubt on their medical necessity.
Yukee reportedly spent the illicit funds on luxury items including a $600,000 Ferrari, an $865,000 Bulgari necklace, a multimillion-dollar Hawaiian home, and financed construction of a $4.6 million beach resort in the Philippines. Authorities plan to seize eight properties and eight vehicles connected to her earnings, including the Ferrari.
The rapid increase in skin substitute costs traces back to a policy loophole that allowed manufacturers to set reimbursement rates. In 2019, prices averaged around $1,042 per square inch, rising to more than $21,000 per square inch by 2025, despite little technological advancement. The Trump administration closed the loophole in July 2025 by establishing a fixed reimbursement rate of $806 per square inch, after initially postponing a Biden administration proposal aimed at limiting Medicare coverage of these products.
Notably, the Justice Department did not indict executives from Extremity Care, another major skin substitute manufacturer with over $1 billion in Medicare revenue. Extremity Care donated $5 million in early 2025 to MAGA Inc., a political committee supporting former President Trump. Its CEO, Oliver Burckhardt, attended a White House-related event where he briefly discussed his company’s work with the former president. The department declined to comment on any investigations involving Extremity Care.