Interest in microbubbles as agents for therapeutic and quantitative imaging applications in biomedical ultrasound has increased the need for their accurate modeling. However, effects such as gas diffusion, the properties of the shell, and changes in bubble behavior under repeated exposure to ultrasound pulses are still not well understood. A revised equation for microbubble motion is proposed that includes the effects of gas diffusion as well as a nonlinear surface tension, which depends on a non-constant surfactant surface concentration. This is incorporated into a nonlinear wave propagation model to account for these additional time-dependent effects in the response of microbubble contrast agent populations. The results from the model indicate significant changes in both bubble behavior and the propagated pulse compared with those predicted by existing propagation models; and show better agreement with experimental data. Our analysis indicates that changes in bubble dynamics are dominated both by surfactant shedding on ultrasonic timescales and gas diffusion over longer timescales between pulses. Therefore, incorporating such time-dependent phenomena in ultrasound imaging algorithms should lead to better quantitative agreement with experiments.