‘‘(J) Implementing all home oxygen therapy 
services that are prescribed by the physician’s plan 
of care. 
‘‘(K) Providing, as needed, appropriate home 
oxygen equipment, supplies, including supplemental 
supplies and emergency oxygen back-ups as appro-
priate. 
‘‘(L) Providing 24-hour on-call coverage to re-
spond to individual’s needs with home oxygen ther-
apy. 
‘‘(M) Assisting the individual with the coordina-
tion of oxygen equipment, services, and providers if 
the individual travels outside of the provider’s serv-
ice area. 
If an individual relocates permanently, the new home oxy-
gen therapy provider for the individual shall assume re-
sponsibility for billing the Medicare program directly. The 
Secretary is directed to determine which of these covered 
services must be performed in person. 
‘‘(2) QUALIFIED HOME OXYGEN THERAPY PRO-
VIDER.— 
‘‘(A) The term ‘qualified home oxygen therapy 
provider’ means an entity that provides home oxygen 
therapy services and home oxygen equipment— 
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‘‘(i) furnishes home oxygen therapy serv-
ices in compliance with applicable laws, rules, 
and regulations to individuals in their homes, 
pursuant to a physician’s order; 
‘‘(ii) is accredited by an accreditation orga-
nization (including organizations deemed as of 
November 2006 by the Secretary to accredit 
durable medical equipment suppliers) that of-
fers home medical equipment or respiratory 
service accreditation services; 
‘‘(iii) complies with the Durable Medical 
Equipment, Prosthetics, Orthotics and Supplies 
Quality Standards adopted by the Secretary in 
October 2008; and 
‘‘(iv) complies with the Durable Medical 
Equipment, Prosthetics, Orthotics and Supplies 
Supplier Standards as set forth at section 
424.57(c) of title 42, Code of Federal Regula-
tions). 
‘‘(B) A qualified home oxygen therapy provider 
may determine which oxygen delivery system meets 
the requirements of the prescribing physician’s order 
and is appropriate for an individual based upon the 
physician’s classification of the individual in a pa-
tient category. 
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‘‘(C) Nothing in this subsection shall be con-
strued to establish a Federal requirement that a 
qualified home oxygen therapy provider employ or 
otherwise retain a licensed respiratory therapist to 
furnish services for which State law does not require 
them to be furnished by such a licensed respiratory 
therapist. 
‘‘(D) Nothing in this title shall be construed as 
authorizing the Secretary to require an entity that 
is a qualified home oxygen therapy provider— 
‘‘(i) to obtain more than one National Pro-
vider Identifier for each location in which the 
provider operates, notwithstanding that the pro-
vider also furnishes durable medical equipment 
under this title; 
‘‘(ii) to obtain a surety bond if the entity 
has already posted a surety bond for purposes 
of meeting such a bond requirement as a sup-
plier of durable medical equipment or other 
lines of business; or 
‘‘(iii) to accept assignment on claims for 
home oxygen therapy services or to be a partici-
pating supplier with respect to such services. 
‘‘(3) RETESTING PROCESS.— 
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‘‘(A) IN GENERAL.—The Secretary shall estab-
lish a re-testing process that requires qualified home 
oxygen therapy providers to facilitate re-testing, in 
accordance with current standards of practice and 
regulations of the Secretary, of individuals furnished 
home oxygen therapy services between 60 and 120 
days of the date on which the services were initiated 
in the case of individuals who had a diagnosis for 
whom home oxygen therapy was prescribed for the 
first time. 
‘‘(B) EXEMPTION.—Such re-testing process 
shall not apply to individuals whose diagnosis was 
for chronic respiratory disease, including for chronic 
conditions that typically require oxygen therapy for 
an extended period of time, such as chronic obstruc-
tive pulmonary disease, emphysema, obstructive 
chronic bronchitis, bronchiectasis, congestive heart 
failure, pulmonary fibrosis, obstructive sleep apnea, 
and Alpha-1 Antitrypsin Deficiency (A1AD).’’. 
(b) PAYMENT.—Section 1834 of such Act (42 U.S.C. 
1395m) is amended by adding at the end the following 
new subsection: 
‘‘(n) PAYMENT FOR HOME OXYGEN THERAPY SERV-
ICES.— 
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‘‘(1) ESTABLISHMENT
OF
SINGLE
BUNDLED 
PAYMENT SYSTEM.—Payment for home oxygen ther-
apy services under this part shall be based on a sin-
gle bundled payment rate for home oxygen therapy 
services (including equipment and supplies) deter-
mined under this subsection. Such a rate shall— 
‘‘(A) be applied separately for each patient 
category established under paragraph (2); 
‘‘(B) be paid on a per-patient-per-month 
basis; 
‘‘(C) be initially computed under para-
graph (3) in a budget neutral manner based on 
allowed payments for providing such services 
(including equipment and supplies); 
‘‘(D) be annually updated in accordance 
with paragraph (4); and 
‘‘(E) be adjusted for its patient services 
component for geographic factors under para-
graph (5). 
‘‘(2) PATIENT CATEGORIES.— 
‘‘(A) IN GENERAL.—Under the single bun-
dled payment system, individuals receiving 
home oxygen therapy services shall be classified 
into one of three patient categories, as follows: 
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‘‘(i) CATEGORY 1.—A first category of 
individuals (in this subsection referred to 
as ‘category 1’) who lack mobility or are 
prescribed oxygen for nocturnal use only. 
‘‘(ii) CATEGORY 2.—A second category 
of individuals (in this subsection referred 
to as ‘category 2’) who have standard port-
ability needs for oxygen therapy. 
‘‘(iii) CATEGORY 3.—A third category 
of individuals (in this subsection referred 
to as ‘category 3’) who have high port-
ability needs for oxygen therapy. 
‘‘(B) DEFINITIONS.—In this paragraph: 
‘‘(i) The term ‘standard portability’ 
means the use of portable oxygen is esti-
mated at less than or equal to 40 liter 
hours per week. 
‘‘(ii) The term ‘high portability’ 
means the use of portable oxygen is esti-
mated at more than 40 liter hours per 
week. 
‘‘(iii) The term ‘liter hours per week’ 
means the total liters of oxygen used dur-
ing a month divided by 4.3 (weeks per 
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month) divided by liters per minute pre-
scribed divided by 60 minutes. 
‘‘(C) REQUIREMENT FOR ASSESSMENT.— 
‘‘(i) IN GENERAL.—Subject to clause 
(ii), on and after January 1, 2010, an indi-
vidual may not be furnished home oxygen 
therapy services under this part unless a 
physician has assigned an individual into a 
patient category and indicated such assign-
ment on a certificate of medical need that 
is given to the home oxygen therapy pro-
vider. 
‘‘(ii) GRANDFATHER.—In the case of 
an individual who is receiving home oxygen 
therapy as of January 1, 2010, for which 
payment is being made under this title, 
clause (i) shall not apply until January 1, 
2011, and until the date a physician as-
signs the individual into a patient category. 
Before such date, the individual shall be 
classified based on the individual’s pre-
scription as in effect on December 31, 
2009. 
‘‘(3) INITIAL PAYMENT RATE.— 
‘‘(A) IN GENERAL.— 
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‘‘(i) The single bundled payment rate 
for 2010, 2011, and 2012 shall be com-
puted annually by the Secretary in a budg-
et neutral manner consistent with subpara-
graph (D) using the distributions for each 
category in clause (ii). The Secretary shall 
not make any prospective adjustments to 
the payment rates under this reimburse-
ment methodology for such years. The base 
year shall be the latest available calendar 
year adjusted data. 
‘‘(ii) For 2010, 2011, and 2012, the 
Secretary shall establish the single bundled 
payment rate by assuming the following 
distribution of individuals among the cat-
egories: 
‘‘(I) In category 1, 30 percent. 
‘‘(II) In category 2, 50 percent. 
‘‘(III) In category 3, 20 percent. 
The Secretary shall base the allowed pay-
ments for categories 1 and 3 upon a per-
centage relationship to the allowed pay-
ment for category 2. Category 3 allowed 
payment rate should be greater than cat-
egory 2 allowed payment rate and category 
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2 allowed payment rate should be greater 
than category 1. 
‘‘(B) PAYMENTS
FOR
YEARS
2013
AND 
2014.—The single bundled payment rates for 
2013 and 2014 shall be computed by the Sec-
retary in a budget neutral manner consistent 
with subparagraph (D) using data obtained 
through the cost reports required under this 
section. 
‘‘(C) PAYMENTS FOR YEARS 2015 AND BE-
YOND.—The single bundled payment rates for 
2015 and subsequent years shall be computed 
by the Secretary using data obtained through 
the cost reports required under this section. 
‘‘(D) BUDGET
NEUTRALITY.—The Sec-
retary shall calculate the single bundled pay-
ment rates established under this section for 
2010, 2011, 2012, 2013, and 2014 such that 
the total spending for each year is equivalent in 
the aggregate to the spending that would have 
been made for home oxygen therapy during 
such year if the amendments made by the 
Medicare Home Oxygen Therapy Services Act 
of 2009 had not been enacted. 
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‘‘(4) ANNUAL
UPDATE
BY
CPI–U.—The pay-
ment rates established under this subsection shall be 
adjusted for each year (beginning with 2011) in a 
prospective manner by the Secretary and be pub-
lished by October 1 of the previous year based on 
the percentage increase in the consumer price index 
for all urban consumers (all items; U.S. city aver-
age) applicable to the year involved. 
‘‘(5) APPLICATION
OF
GEOGRAPHIC
ADJUST-
MENT.—The payment rates established under this 
subsection shall be adjusted, in a budget neutral 
manner, to take into account differences among 
areas in labor and transportation costs. 
‘‘(6) INCLUDING PATIENT CATEGORY AND RE-
LATED INFORMATION ON CERTIFICATE OF MEDICAL 
NEED.—The Secretary shall modify the certificate of 
medical need used under this part for home oxygen 
therapy services so that an individual’s physician 
would indicate on the form the appropriate patient 
category for the individual. Any change in an indi-
vidual’s category would be made by the physician 
submitting an updated certificate of medical need 
form indicating the change in the individual’s cat-
egory. 
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‘‘(7) RESPONSIBILITIES
OF
QUALIFIED
HOME 
OXYGEN THERAPY PROVIDERS AND PHYSICIANS.— 
‘‘(A) PROVIDERS.—A qualified home oxy-
gen therapy provider is responsible for moni-
toring and periodically re-evaluating, using the 
Oxygen Patient Evaluation Form, each indi-
vidual to whom the provider is furnishing home 
oxygen therapy services under this part and no-
tifying the prescribing physician when the re-
sults of such an re-evaluation indicate that a re- 
assignment in a category under this subsection 
may be warranted due to a change in the indi-
vidual’s clinical condition or ambulatory status. 
‘‘(B) PHYSICIANS.—Such an individual’s 
physician is responsible for making any change 
in such an individual’s category placement and 
for documenting such change in the individual’s 
medical record and providing an updated cer-
tificate of medical need to the home oxygen 
therapy provider. 
‘‘(8) COST REPORTS.— 
‘‘(A) IN GENERAL.—The Secretary in con-
sultation with the Home Oxygen Therapy Advi-
sory Committee established under paragraph 
(9) shall develop an annual cost report for 
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qualified home oxygen therapy providers with 
respect to the costs incurred for equipment, 
supplies, and services furnished to individuals. 
Qualified home oxygen therapy providers shall 
submit such report annually to the Secretary 
and the Secretary shall not require the submis-
sion of more than one such cost report for such 
a provider for each year. 
‘‘(B) STREAMLINED REPORT FOR SMALL 
SUPPLIERS.—Qualified home oxygen therapy 
providers with not more than $1,000,000 in 
revenue from the provision of home oxygen 
therapy services under this part shall be per-
mitted to submit a shorter or streamlined re-
port under this paragraph. 
‘‘(C) IMPLEMENTATION.—The Secretary 
shall not require the submission of a cost report 
under this paragraph earlier than January 1, 
2012. 
‘‘(9) HOME OXYGEN THERAPY ADVISORY COM-
MITTEE.— 
‘‘(A) IN
GENERAL.—The Secretary shall 
establish and convene an independent, multi-
disciplinary, nonpartisan Home Oxygen Ther-
apy Advisory Committee (in this paragraph re-
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ferred to as the ‘Advisory Committee’) (pursu-
ant to section 222 of the Public Health Service 
Act (42 U.S.C. 217a)) not later than 6 months 
after the date of the enactment of this sub-
section. 
‘‘(B) COMPOSITION.—The Advisory Com-
mittee shall consist of such members as the 
Secretary may appoint and who shall serve for 
such term as the Secretary may specify. In ap-
pointing members, the Secretary shall consult 
with the home oxygen therapy community. The 
Advisory Committee shall be comprised of mem-
bers of the home oxygen therapy community, 
including patients, nurses, respiratory thera-
pists, physicians, qualified home oxygen therapy 
providers representing urban and rural markets 
and the diverse provider community, public 
health organizations, patient advocates, and 
manufacturers. In this subparagraph, the term 
‘public health organization’ means a private en-
tity and does not include a public health agen-
cy. 
‘‘(C) FUNCTIONS.—The Committee shall 
provide a forum for expert discussion and delib-
eration and the formulation of advice and rec-
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ommendations to the Secretary regarding cov-
erage and payment for home oxygen therapy 
services under this part, including— 
‘‘(i) selecting, modifying, and updat-
ing quality measures; 
‘‘(ii) developing the objective, evi-
dence-based clinical criteria used to define 
each of the patient categories; 
‘‘(iii) designing a consensus-based ox-
ygen patient evaluation form; 
‘‘(iv) refining the services included in 
home oxygen therapy services; 
‘‘(v) establishing a quality improve-
ment program; 
‘‘(vi) evaluating a comparative effec-
tiveness program that also would also in-
clude chronic care management; and 
‘‘(vii) strengthening anti-fraud, abuse, 
and waste provisions by— 
‘‘(I) mandating site inspections 
for all new home oxygen therapy pro-
viders; 
‘‘(II) requiring site inspections 
for all home oxygen therapy provider 
renewals; 
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‘‘(III) improving validation of 
new home oxygen therapy providers 
by improving the application process 
for obtaining a National Provider 
Identifier; 
‘‘(IV) requiring two additional 
random, unannounced site visits for 
all new home oxygen therapy pro-
viders during the first year of oper-
ation; 
‘‘(V) requiring a 6-month trial 
period for new home oxygen therapy 
providers during which time the pro-
vider would receive a preliminary Na-
tional Provider Identifier; 
‘‘(VI) establishing an anti-fraud 
office within the Centers for Medicare 
& Medicaid Services to coordinate de-
tection and deterrence of fraud and 
improper payments across the Medi-
care and Medicaid programs by ac-
cepting and responding to reports of 
alleged fraud and abuse from physi-
cians and providers; 
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‘‘(VII) considering the proper 
Federal funding levels needed for im-
proving fraud prevention; 
‘‘(VIII) requiring post-payment 
audit reviews for all new home oxygen 
therapy providers relying upon 6 
months’ worth of claims submissions; 
‘‘(IX) requiring the Centers for 
Medicare & Medicaid Services to con-
duct real-time claims analysis ana-
lyzing home oxygen therapy provider 
claims to identify aberrant billing pat-
terns more quickly; 
‘‘(X) ensuring that all providers 
are qualified to offer the services for 
which they submit claims by man-
dating cross-checking Medicare and 
other relevant databases to ensure 
that home oxygen therapy providers 
are qualified and accredited for pro-
viding home oxygen therapy services; 
‘‘(XI) establishing written due 
process procedures for home oxygen 
therapy providers applying for a Na-
tional Provider Identifier, including 
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establishing an administrative appeals 
process and clear timelines; 
‘‘(XII) increasing penalties and 
fines and fraud for activities such as 
buying or stealing beneficiaries’ Medi-
care numbers or physician’s provider 
numbers; and 
‘‘(XIII) establishing more rig-
orous quality standards. 
‘‘(D) REPORT.—The Committee shall pro-
vide the Secretary with periodic reports that 
summarize the Committee’s activities and its 
recommendations for such legislation and ad-
ministrative action as it considers appropriate. 
‘‘(E) 
AUTHORIZATION
OF
APPROPRIA-
TIONS.—There are authorized to be appro-
priated such sums as may be necessary to carry 
out the purposes of this paragraph. 
‘‘(10) CLAIMS
PROCESSING.—The Secretary 
shall provide for processing of claims for home oxy-
gen therapy services from home oxygen therapy pro-
viders to be conducted through the administrative 
contractors under this title for durable medical 
equipment. 
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‘‘(11) BENEFICIARY
RIGHTS.—The Secretary 
shall establish through regulation the following pro-
tections for individuals receiving home oxygen ther-
apy services under this part: 
‘‘(A) To choose the individual’s local pro-
vider of such services from among qualified 
home oxygen therapy service providers and to 
change such provider. 
‘‘(B) To receive communications from the 
home oxygen therapy provider in a clear and 
understandable manner. 
‘‘(C) To privacy and confidentiality in all 
aspects of treatment and their personal health 
information consistent with Federal and State 
laws. 
‘‘(D) To be informed by the home oxygen 
therapy provider about and participate, if de-
sired, in all aspects of the oxygen therapy serv-
ices being furnished to the individual by the 
provider, and be informed by such provider of 
the right to refuse treatment, to discontinue 
treatment, and to refuse to participate in exper-
imental research. 
‘‘(E) To be informed by the home oxygen 
therapy provider of policies and expectations of 
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consult with individual’s physician regarding 
such changes to ensure they are appropriate 
and necessary and the exceptions as specified 
by the Secretary when a home oxygen therapy 
provider may change an individual’s oxygen 
equipment. 
‘‘(L) To be informed by the home oxygen 
therapy provider of the provider’s internal and 
external grievance processes (as well as how to 
contact Medicare through the hotline or Bene-
ficiary Ombudsman), including the individual’s 
right to file internal or external grievances or 
both without retaliation or denial of services 
and the right to file them personally or through 
a representative of the individual’s choosing. 
‘‘(M) To receive from the home oxygen 
therapy provider written notice 30 days in ad-
vance of an involuntary termination, after the 
home oxygen therapy provider follows estab-
lished involuntary discharge procedures; how-
ever, in the case of immediate threats to the 
health and safety of others, the Secretary may 
permit the home oxygen therapy provider to use 
an abbreviated termination procedure. 
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‘‘(N) To be assisted by the home oxygen 
therapy provider in obtaining the equipment 
and supplies for home oxygen therapy services 
prescribed by individual’s treating physician 
when the individual is traveling. 
‘‘(O) To receive from the home oxygen 
therapy provider oxygen supplies, refills, and 
emergency back-up equipment and refills as ap-
propriate.’’. 
SEC. 4. EFFECTIVE DATE. 
The amendments made by this Act shall apply to 
services and supplies furnished on or after January 1, 
2010. 
Æ 
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