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nitial coverage of home oxygen therapy and oxygen equipment is reasonable and necessary if all of the following conditions are met:

1. The treating practitioner has ordered and evaluated the results of a qualifying blood gas study performed at the time of need; and,
2. The beneficiary's blood gas study meets the criteria stated below; and,
3. The qualifying blood gas study was performed by a treating practitioner or by a qualified provider or supplier of laboratory services; and,
4. The provision of oxygen and oxygen equipment in the home setting will improve the beneficiary’s condition.

Time of need is defined as during the patient’s illness when the presumption is that the provision of oxygen will improve the patient’s condition in the home setting. For an inpatient hospital patient anticipated to require oxygen upon going home, the time of need would be within 2 days of discharge. 

Resting Room Air Testing 

An arterial PO2 at or below 55 mm Hg or an arterial oxygen saturation at or below 88 percent taken at rest (awake) while breathing room air; or,

Exercise testing:

When oxygen therapy and oxygen equipment is covered based on an oximetry study obtained during exercise, there must be documentation of three (3) oximetry studies in the beneficiary’s medical record:

(1) Testing at rest without oxygen; and,

(2) Testing during exercise without oxygen; and,

(3) Testing during exercise with oxygen applied (to demonstrate the improvement of the hypoxemia).

All 3 tests must be performed within the same testing session. Exercise testing must be performed in-person by a treating practitioner or other medical professional qualified to conduct exercise oximetry testing. Unsupervised or remotely supervised home exercise testing does not qualify as a valid test for purposes of Medicare reimbursement of home oxygen and oxygen equipment. Only the testing during exercise without oxygen (#2 above) is used for qualification. All 3 test results must be available upon request.

Oximetry obtained after exercise while resting, sometimes referred to as “recovery” testing, is not part of the 3 required test elements and is not valid for determining eligibility for oxygen therapy and oxygen equipment coverage.

Nocturnal Testing:

A decrease in arterial PO2 more than 10 mm Hg, or a decrease in arterial oxygen saturation more than 5 percent from baseline saturation, taken during sleep and associated with symptoms of hypoxemia such as impairment of cognitive processes and nocturnal restlessness or insomnia (not all inclusive). In this instance, oxygen and oxygen equipment is only reasonable and necessary during sleep. 

Baseline saturation is defined as the mean saturation level during the duration of the test. For purposes of meeting criterion 3 described in Group I above there must be a minimum of 2 hours test time recorded for sleep oximetry. The result must reach a qualifying test value.

Home overnight oximetry is limited solely to stand-alone overnight pulse oximetry performed in the beneficiary’s home under the conditions specified below. Overnight oximetry performed as part of home sleep testing or as part of any other home testing is not considered to be eligible under this provision to be used for qualification for reimbursement of home oxygen and oxygen equipment even if the testing was performed in compliance with the requirements of this section.

Obstructive Sleep Apnea (OSA), Polysomnography and Home Sleep Tests:

For beneficiaries with OSA, this means that the OSA must be sufficiently treated such that the underlying condition resulting in hypoxemia is unmasked. This must be demonstrated before oxygen saturation results obtained during polysomnography are considered qualifying for oxygen therapy and oxygen equipment.

For beneficiaries with OSA, a qualifying oxygen saturation test may only occur during a titration polysomnographic study (either split night or stand-alone). The titration PSG is one in which all of the following criteria are met:

1. The titration is conducted over a minimum of two (2) hours; and,
2. During titration:
   1. The AHI/RDI is reduced to less than or equal to an average of ten (10) events per hour; or,
   2. If the initial AHI/RDI was less than an average of ten (10) events per hour, the titration demonstrates further reduction in the AHI/RDI; and,
3. Nocturnal oximetry conducted for the purpose of oxygen therapy and oxygen equipment reimbursement qualification may only be performed after optimal PAP settings have been determined and the beneficiary is using the PAP device at those settings; and,
4. The nocturnal oximetry conducted during the PSG demonstrates an oxygen saturation of ≤ 88%.

Link to Medicare Criteria Website