Initial certification - Medical necessity

In reviewing the claim and the supporting data, contractors compare certain items, especially pertinent dates of treatment. For example, the start date of home oxygen coverage cannot precede the date of prescription or the date of the test(s) whose results establish that the special coverage criteria are met. Once coverage is established, the estimated length of need in Section B on the Form CMS-484, and the circumstances and the results of testing that established the medical necessity at the start of home oxygen therapy, determines the recertification schedule.

Definitions of "Group" based on blood gas values:

Group I - An arterial PO2 at or below 55 mm Hg, or arterial blood oxygen saturation at or below 88 percent.

Group II - An arterial PO2 is 56 to 59 mm Hg or arterial blood oxygen saturation is 89 percent.

Group III - An arterial PO2 at or above 60 mm Hg, or arterial blood oxygen saturation at or above 90 percent.

When oxygen is prescribed in an institution, in order to establish medical necessity it is necessary that the institution would have to recheck the oxygen level no sooner than 2 days before discharge.

Clinical documentation will be reviewed to confirm the fact that the prescribing of continued oxygen was based upon the "chronic stable state" (was done while the patient was in a chronic stable state - i.e., not during a period of acute illness or an exacerbation of the patient's underlying disease) of the patient.

Contractors verify that the information shown on or accompanying the Form CMS-484 or other CMN supports the need for oxygen as billed.

When both arterial blood gas (ABG) and oxygen saturation (oximetry) tests have recently been performed on the same day, suppliers report only the ABG result. That test is generally acknowledged as the more reliable indicator of hypoxemia.
Test results from oximetry tests performed by a DME supplier, or anyone financially associated with or related to the DME supplier, are not acceptable.

Values in Group III establish a rebuttable presumption of non-coverage. The CMN must be supplemented by additional documentation from the treating physician designed to overcome this presumption and justify the oxygen order, including a summary of other, more conservative therapy that has not relieved the patient's condition. Claims with such documentation are referred to the contractor's medical director for the coverage determination.


The following types of claims are denied without further development:

• Claims where the only qualifying test results came from oximetry tests conducted by a DME suppliers other than a hospital;

• Claims lacking information necessary to justify coverage;

• Hard copy claims where the CMN or Form CMS-484 lacks the treating physician's signature; or

• Electronic claims where the CMN or Form CMS-484 fails to indicate that the treating physician's handwritten signature is on file in the supplier's office.


An initial CMN is also required when there has been a break in medical necessity of 60 days plus whatever days remained in the rental month during which the oxygen was discontinued. (This indication does not apply if there was just a break in billing because the patient was in a hospital, nursing facility, hospice, or HMO, but the patient continued to use oxygen during that time.)