Learn About Medicare Oxygen Coverage Options

What Medicare Oxygen Coverage Includes

Medicare Part B covers oxygen therapy for people who have a medical need for supplemental oxygen. The program pays for the oxygen itself, the equipment used to deliver it, and related supplies. Understanding what falls under Medicare's coverage helps people know what expenses the program may help pay for and what they might need to cover separately.

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Medicare covers several types of oxygen delivery systems. These include compressed oxygen tanks, liquid oxygen systems, and oxygen concentrators—machines that pull oxygen from the air. The program also covers the tubing, masks, and other equipment needed to use these systems. Replacement parts and supplies that wear out over time, such as tubing and masks, are typically covered as well.

The coverage extends to oxygen used at home, though Medicare has different payment structures depending on whether someone rents or owns the equipment. For people using portable oxygen tanks to move around outside the home, Medicare may cover portable tanks as part of the overall oxygen therapy benefit. The program also covers oxygen when used during air travel, under certain conditions.

It's important to note that a doctor must prescribe the oxygen therapy. The prescription should specify how many hours per day the person needs to use oxygen and what type of oxygen system works best for their condition. Without a doctor's order, Medicare will not cover oxygen-related expenses.

Practical Takeaway: Review your Medicare documents or contact Medicare directly to see the specific equipment and supply types your plan covers. Keep copies of your oxygen prescription, as you'll need it to receive coverage.

How Medicare Determines Oxygen Necessity

Medicare uses clinical guidelines to determine whether someone truly needs oxygen therapy. The program doesn't cover oxygen based on a doctor's opinion alone—instead, Medicare requires specific medical test results that show a person's blood oxygen level is too low. This ensures coverage goes to people who have genuine medical need and helps prevent misuse of the benefit.

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The primary test Medicare uses is called arterial blood gas testing, or ABG. This test measures oxygen levels in blood drawn directly from an artery. Another common test is pulse oximetry, which uses a small device placed on the finger to measure oxygen levels. A person's oxygen level must fall below certain thresholds for Medicare to consider oxygen therapy medically necessary. Generally, oxygen is covered if blood oxygen levels are 55 percent or lower, or between 56 and 59 percent with certain lung conditions or heart problems.

Testing usually happens at a hospital, clinic, or doctor's office. The tests may be performed while the person is resting, sleeping, or exercising, depending on when the doctor suspects oxygen levels drop too low. Some people only need oxygen during physical activity or sleep, while others need it constantly. The testing process helps identify when oxygen is needed and how much.

After initial testing shows a person needs oxygen, Medicare typically requires follow-up tests or documentation within a certain timeframe to continue coverage. This helps ensure the person still requires oxygen therapy over time. If oxygen needs change, new tests may be ordered.

Practical Takeaway: Ask your doctor to explain what your test results mean and how they relate to your oxygen prescription. Keep all test records and copies of your prescription to have on file.

Medicare Part B and Oxygen Equipment Costs

Medicare Part B is the component of Original Medicare that covers oxygen equipment and supplies. People with Part B coverage pay a portion of oxygen costs through several payment methods: a monthly premium, a yearly deductible, and coinsurance (a percentage of the cost after the deductible is met).

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The way Medicare pays for oxygen equipment depends on whether the equipment is rented or purchased. For rented equipment, Medicare typically covers 80 percent of the approved cost after the Part B deductible is met. The person receiving oxygen is responsible for the remaining 20 percent coinsurance. Rental payments continue as long as the person uses the equipment and meets medical necessity requirements.

If someone purchases oxygen equipment outright, Medicare may cover up to 80 percent of the approved price after meeting the deductible. However, there are rental period requirements—Medicare may expect a person to rent equipment for a certain time before purchasing is considered. The program has approved supplier locations and specific rules about where equipment can be purchased for Medicare to provide payment.

In 2024, the Part B deductible is $240 per year. Once this deductible is paid through any combination of Part B-covered services, the 80/20 cost-sharing applies to oxygen services. Some people have additional insurance through Medigap plans or Medicare Advantage plans that helps pay the coinsurance amounts.

Costs vary by location and supplier, and Medicare publishes approved amounts for different types of oxygen equipment. A supplier should be able to explain what Medicare will pay and what out-of-pocket costs a person will face.

Practical Takeaway: Before starting oxygen therapy, ask your supplier what your Part B deductible status is and what your coinsurance will be. Request an estimate of total out-of-pocket costs based on your specific equipment needs.

Medicare Advantage Plans and Oxygen Coverage

Medicare Advantage plans, also known as Part C plans, offer an alternative way to receive Medicare benefits. These are private insurance plans run by insurance companies that contract with Medicare. Medicare Advantage plans must cover at least the same services as Original Medicare, including oxygen therapy, but they can structure coverage differently.

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With Medicare Advantage plans, oxygen coverage details depend on the specific plan chosen. Some plans may have lower out-of-pocket costs for oxygen than Original Medicare, while others might have higher costs or additional restrictions. For example, a Medicare Advantage plan might require using equipment from preferred suppliers or might have different coinsurance percentages than the standard 20 percent under Original Medicare.

Medicare Advantage plans often include additional benefits that Original Medicare doesn't cover, such as dental or vision care. Some plans also offer programs to help manage chronic conditions, which could benefit someone using oxygen long-term. However, these plans typically have network restrictions—meaning a person usually must use healthcare providers and suppliers within the plan's network.

People with Medicare Advantage plans should review their plan documents to understand oxygen coverage specifics. The plan's Summary of Benefits document outlines what's covered and what costs apply. During the annual open enrollment period (October 15 through December 7), people can compare oxygen coverage among different plan options in their area and switch plans if desired.

Supplier networks are particularly important to check. A plan might offer good oxygen coverage, but if the person's preferred supplier isn't in the network, the out-of-pocket costs could be much higher. Contacting the plan directly with questions about specific suppliers ensures clarity before committing to a plan.

Practical Takeaway: Request the Summary of Benefits from any Medicare Advantage plan you're considering. Call the plan to verify your preferred oxygen supplier is in-network and ask about typical coinsurance for oxygen equipment.

Working With Medicare-Approved Oxygen Suppliers

Medicare only pays for oxygen equipment and supplies purchased from suppliers that hold Medicare approval. These are called Durable Medical Equipment (DME) suppliers. Using an unapproved supplier means Medicare will not pay for the equipment or supplies, leaving the person responsible for all costs. Finding and working with approved suppliers is an important step in receiving covered oxygen therapy.

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The Medicare website maintains a searchable directory of approved DME suppliers by location. A person can search by ZIP code to find suppliers near them. The supplier should have a Medicare supplier number and should be willing to show proof of approval. Alternatively, a doctor's office can recommend approved suppliers they work with regularly.

Once a supplier is chosen, the person will need to provide their Medicare information and a copy of the oxygen prescription. The supplier handles billing Medicare directly and collects the patient's coinsurance amount. A reputable supplier will explain all costs upfront, including what Medicare will pay and what the patient owes.

Approved suppliers must follow Medicare rules about equipment quality, delivery, maintenance, and customer service. If equipment breaks or needs maintenance, the supplier is responsible for repairs or replacements at no cost to the patient (beyond normal coinsurance). Suppliers must also provide instruction on how to use equipment safely.

Patients should feel comfortable asking suppliers questions about billing, equipment operation, troubleshooting, and availability. If a person is unhappy with their supplier's service, they may switch to a different approved supplier. The prescription can be transferred, and a new supplier will take over billing and equipment delivery.