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The rules say that plans must pay for a medical service or item if regular Medicare would pay for it in this case. 
You can find this rule at 42 Code of Federal Regulations (CFR) Section 422.101. 
 
The rules say Initial 36 months: Reimbursement for oxygen equipment is limited to 36 monthly rental 
payments. Payment for accessories (e.g., cannula, tubing, etc.), delivery, back-up equipment, maintenance, and 
repairs is included in the rental allowance. Payment for oxygen contents (stationary and/or portable) is included 
in the allowance for stationary equipment (E0424, E0439, E1390, E1391). 
 
Payment for stationary equipment is increased for beneficiaries requiring greater than 4 liters per minute (LPM) 
of oxygen flow and decreased for beneficiaries requiring less than 1 LPM. If a beneficiary qualifies for 
additional payment for greater than 4 LPM of oxygen and also meets the requirements for portable oxygen, the 
appropriate modifiers (QB or QF) must be used. 
 
The supplier who provides oxygen equipment for the first month must continue to provide any necessary 
oxygen equipment and all related items and services through the 36-month rental period, unless one of the 
following exceptions is met: 
 
Beneficiary relocates temporarily or permanently outside of the suppliers service area 
Beneficiary elects to obtain oxygen from a different supplier 
Individual case exceptions made by CMS or DME MAC 
Item becomes subject to competitive bidding 
Providing different oxygen equipment/modalities (e.g., concentrator [stationary or portable], gaseous, liquid, 
trans-filling equipment) is not permitted unless one of the following requirements is met: 
 
Supplier replaces the equipment with the same or equivalent item 
Treating practitioners orders different equipment 
Beneficiary chooses to receive an upgrade and signs an Advance Beneficiary Notice of Non-coverage (ABN) 
CMS or the DME MAC determines that a change in equipment is warranted 
A new 36-month rental period can begin only in the following situations: 
 
Specific incident of damage beyond repair (e.g., dropped and broken, fire, flood, etc.) or the item is stolen or 
lost 
Break-in-need for at least 60 days plus the days remaining in the month of discontinuation and new medical 
necessity is established (see BREAK-IN-SERVICE below) 
A new 36-month rental period does not start in the following situations: 
 Replacing equipment due to malfunction, wear and tear, routine maintenance, repair 
Providing different equipment based on a treating practitioner order or beneficiary request for an upgrade 
Break-in-need less than 60 days plus the days remaining in the month of discontinuation (see BREAK-IN-
SERVICE below) 
Break-in-billing (see BREAK-IN-SERVICE below) 
Changing suppliers 
Months 37-60 
 
There is no further payment for oxygen equipment during the 5-year reasonable useful lifetime (RUL) of the 
equipment after 36 rental payments have been made. If use of portable equipment (E0431, E0433, E0434, 
E1392, K0738) begins after the use of stationary equipment begins, payment for the portable equipment can 
continue after payment for the stationary equipment ends until 36 rental payments have been made for the 
portable equipment. 
 
For information on payment for contents and maintenance, see separate sections below. 
 
The supplier who provided the equipment during the 36th rental month is required to continue to provide the 
equipment, accessories, contents (if applicable), maintenance, and repair of the oxygen equipment during the 5 
year reasonable useful lifetime of the equipment. 
 
Rules for providing different equipment/modalities are the same in months 37-60 as they are in the initial 36 
months (see above). 
 
A new 36-month rental period can begin only in the following situation: 
 
There is a specific incident of damage beyond repair (e.g., dropped and broken, fire, flood, etc.) or the item is 
stolen or lost 
 
You can find this information in Medicare's Local Coverage Article Oxygen and Oxygen Equipment - Policy 
Article (A52514). 
 
If you want to read these Medicare rules, you can go to this website www.medicareappeal.com.