Clinicians: Are You Ordering Oxygen for Your Patient?

Home use of oxygen and oxygen equipment is eligible for Medicare reimbursement only when a beneficiary meets all of the requirements set out in the CMS Internet Only Manual (IOM), Publication 100-03, Medicare National Coverage Determinations (NCD) Manual, Chapter 1, Section 240.2 and the corresponding DME MAC Oxygen and Oxygen equipment Local Coverage Determination (LCD). When ordering oxygen therapy for patients who are Medicare beneficiaries, you must see him/her within 30 days prior to the start of oxygen therapy to discuss the condition necessitating the home use of oxygen. In addition to being evaluated within 30 days, qualification testing must be performed within 30 days prior to the date of the initial certification. If the oxygen is initially prescribed at the time of hospital discharge, qualification testing must be performed within the 2 days prior to discharge home. Note that this 2-day prior to discharge rule does not apply to nursing facilities.

Claims for oxygen must be supported by medical documentation in the patient’s record. This documentation may be in the form of a prescription written by the patient’s attending physician who has recently examined the patient (normally within a month of the start of therapy) and must specify:

  • A diagnosis of the disease requiring home use of oxygen;
  • The oxygen flow rate; and,
  • An estimate of the frequency, duration of use (e.g., 2 liters per minute, 10 minutes per hour, 12 hours per day), and duration of need (e.g., 6 months or lifetime).

NOTE: A prescription for “Oxygen PRN” or “Oxygen as needed” does not meet this last requirement. Neither provides any basis for determining if the amount of oxygen is reasonable and necessary for the patient.

The patient’s medical record must also contain sufficient information about the patient’s medical condition to substantiate the necessity for the type and quantity of items ordered and for the frequency of use or replacement (if applicable). Medical record documentation must also show that other alternative treatments (e.g., medical and physical therapy directed at secretions, bronchospasm and infection) have been tried or considered and deemed clinically ineffective.

The type of oxygen delivery system to be used must be specified (e.g., a portable as well as a stationary concentrator or a portable oxygen concentrator along with a stationary concentrator). If a portable system is ordered, there are specific requirements that must be included in the medical record, including that the patient is mobile within the home and that the qualifying blood gas study was performed either at rest or while exercising, but not while asleep.

In addition, for scenarios where the beneficiary has different daytime and nighttime oxygen flow requirements, these values must be documented in the patient's medical record. This information is used by the DME supplier to determine the appropriate billing information for Medicare.

Medicare can make payment for home oxygen supplies and equipment only when the patient's medical record shows that the he/she has significant hypoxemia from an underlying lung condition and meets medical documentation, test results, and health conditions required for coverage.

The treating practitioner is required to complete and sign Form CMS-484 (Certificate of Medical Necessity (CMN): Oxygen) in a timely manner; however, the CMN itself is not considered part of the medical record. All information included on the CMN must be supported by the contemporaneous medical record. See form completion instructions in the CMS IOM Publication 100-08, Medicare Program Integrity Manual, Chapter 5 (CMNs are required for dates of service prior to January 1, 2023 only).

The Comprehensive Error Rate Testing (CERT) contractor has identified multiple errors in claims received for oxygen equipment and supplies. These errors include:

  • Missing documentation of an encounter prior to the oxygen order
  • Missing documentation of oxygen orders prior to delivery
  • No indication of the qualifying test results in the medical record as reported on the CMN
  • No documentation to support continued need for home oxygen therapy.

DMEPOS suppliers are your partners in caring for your patient. They will not receive payment from Medicare for the items that are ordered if you do not provide information from your medical records when it is requested. Furthermore, not providing this information may result in your patients having to pay for the item themselves. To help patients, the DME suppliers, and the Medicare program, be sure to verify that the medical documentation supports the oxygen orders and CMNs as this allows Medicare to pay claims appropriately and efficiently.

For additional information and resources on Medicare's coverage of oxygen and oxygen equipment, visit the DME MAC contractor websites.


Last Updated Nov 30 , 2022