Satisfying the Medical Necessity Requirements for Oxygen

The Oxygen coverage requirements that are published by Medicare are listed under "Oxygen" in the alphabetized listing of all home medical equipment on this website's page  "Medicare Coverage for Home Medical Equipment."

However, certain words or phrases in the Medicare policy require clarification if all the requirements for “medical necessity” are to be met met.

1) Office visit means a face-to-face evaluation by the prescribing physician within 30 days in advance of prescribing the oxygen.
2) Any oxygen prescription must be fully legible and specify the type of equipment and duration of use. It must include a legible, handwritten signature by the physician and be delivered in writing to the oxygen supplier before any equipment is delivered.
3) A "chronic lung condition or other disease" must be among Medicare's select group of diagnoses. Many beneficiaries with non-chronic lung diseases, such as pneumonia, do seek assistance breathing with oxygen but these beneficiaries are not covered.

4) "Significant hypoxemia"(oxygen depravation, shortness of breath) may only be demonstrated to Medicare by oxygen level testing satisfying strict requirements.
5) "Chronic stable state" rules out  those patients being admitted to the emergency room or the hospital and even includes the 2 day period before discharge from the hospital. Testing performed on individuals in a “non-stable” health state is invalid.

6) "your blood gas or O2 saturation level" must be a current test (within past 30 days) and satisfy strict numerical requirements

 7) "indicate the need" also means that different levels of need are indicated such as:  a) Only testing performed at rest allows approval of continuous or nocturnal use          b) Testing performed with individual breathing oxygen must include room air result also  c) Testing performed during exertion restricts types of equipment that will be approved

8) "study performed by a physician" means performed or supervised, with test results being documented in the physician’s office notes and on original prescription. Testing performed during sleep must record at least 5 minutes of oxygen deprivation. 
9) Physician’s office notes must be immediately available to oxygen supplier
10) Diagnoses reported by the physician must comply with Medicare’s select list of allowable conditions with at least one of the valid diagnoses appearing on prescription
11) Physician must personally approve the specific equipment, and all fees, in writing prior to delivery of equipment.   

According to Medicare, in the Northeast region, where the denial rate for oxygen claims is currently at 76.33%, the primary reasons are:

1)  No In-person, face-to-face examination by a physician within 30 days prior to prescription was documented. (38.5%)  No in-person examination by physician within 90 days prior to  renewal of original prescription after 12 months was documented (16%). 

2)  No qualifying blood oxygen level test result could be validated (11.33%) 

3)  No standardized Medicare prescription form showing physician's written approval of type of equipment and fees being charged submitted. (2.8%) 

4)  The prescribing physician’s office notes that were submitted with the insurance claim for oxygen equipment were illegible or a signature stamp was used (2.5)

5)  The provider billed in error, such as ineligible beneficiary or delivery date was prior to hospital discharge date (2.2%)  

6)  Physician did not date the Medicare Certificate of Medical Necessity prescription form in a timely manner, or dated the CMN form before providing a written order for equipment to the oxygen provider (1.4%)