The SOAR Act of 2025 reforms Medicare supplemental oxygen benefits, protects respiratory therapist reimbursement, strengthens fraud prevention through electronic documentation, and establishes new patient rights for oxygen therapy recipients.
Bill Cassidy
Senator
LA
The SOAR Act of 2025 aims to significantly reform Medicare coverage for supplemental oxygen therapy by ending competitive bidding and establishing new payment rates for suppliers. The bill also protects access to respiratory therapist services by ensuring Medicare reimbursement for their work. Furthermore, it strengthens fraud prevention through mandated electronic documentation while simultaneously restoring clinical judgment in claim reviews. Finally, the Act establishes a comprehensive set of new rights and protections for beneficiaries receiving oxygen equipment and services.
Oxygen Bill Ends Competitive Bidding, Mandates 24/7 Supplier Support, and Boosts Liquid Oxygen Payments Starting 2026
The Supplemental Oxygen Access Reform Act of 2025, or the SOAR Act, is a major overhaul of how Medicare pays for and regulates supplemental oxygen for beneficiaries. Starting January 1, 2026, the bill scraps the controversial competitive bidding program for oxygen equipment, replacing it with a new, geographically adjusted fee schedule designed to cover costs better. This is a big deal because competitive bidding was often criticized for driving prices down so low that some suppliers struggled to provide quality service, especially in rural areas.
The New Math: What Oxygen Costs Now
The core of this bill is the money. Instead of competitive bidding, the SOAR Act sets up complex new payment formulas. For oxygen suppliers in urban areas, payments will be based on the old 2025 fee schedule, adjusted yearly for inflation (CPI). For rural areas, the bill mandates a higher blend, combining 50% of a national average price with 50% of the old fee schedule, which should mean better reimbursement for suppliers facing higher delivery costs. If you live in a rural or non-contiguous area, this means your local supplier is much more likely to be able to afford to keep their doors open and serve you.
Crucially, the bill creates a special, higher payment track specifically for liquid oxygen. Liquid oxygen is essential for many patients with high-flow needs or who require greater mobility, but it is expensive to deliver and maintain. The SOAR Act requires Medicare to set these new rates through rulemaking, ensuring they cover the true cost of the liquid oxygen, equipment, and delivery infrastructure. If you or a loved one relies on liquid oxygen, this provision is designed to ensure you won't lose access because suppliers can’t afford to provide it, and it includes extra payment for patients needing more than six liters per minute.
Your Supplier Just Got a New Job Description
One of the most impactful changes for patients is the establishment of strict, mandatory responsibilities for oxygen suppliers (Sec. 102). To get paid by Medicare, suppliers must now guarantee a long list of services. This isn't just dropping off a tank anymore; they must provide initial evaluations, ensure you have portable equipment for mobility outside the home, offer 24-hour on-call support for equipment issues, and help coordinate travel assistance if you leave their service area temporarily. If you’ve ever had an equipment failure on a weekend, that mandated 24-hour support is a game-changer.
These requirements also include mandatory education on safety and infection control, and they must guarantee equipment maintenance according to manufacturer specs. If you’re a patient, this means your supplier can no longer just point you to a manual; they are responsible for making sure you can safely and effectively use your equipment. If you’re a supplier, you’re now operating under a much higher service standard, which might be tough for smaller operations to meet.
More Care and Clearer Bills
Title II formally adds respiratory therapist services to the list of things Medicare Part B covers, effective January 1, 2026 (Sec. 201). This is significant because it recognizes the specialized role of respiratory therapists in assessing and managing oxygen therapy, ensuring they get paid for their services. This should improve the quality of care and follow-up patients receive.
On the administrative side, the bill strengthens program integrity by requiring doctors to use a new electronic template to document medical necessity for oxygen (Sec. 301). This template becomes the definitive source for auditors. However, the bill also restores the use of clinical inference in audits—the ability for Medicare reviewers to use common sense and clinical judgment when looking at documentation, a practice that was curtailed after 2009. The goal is to cut down on fraud while preventing unnecessary claim denials based on minor paperwork errors.
Finally, the SOAR Act gives patients a slew of new rights (Title IV). Suppliers must now inform you of your right to choose a supplier and your right to file a grievance without fear of retaliation. Most importantly for your wallet, Medicare must send you a monthly notice detailing exactly how many months remain in the 36-month rental cap period where you are responsible for copayments. Once that 36-month period is up, the equipment is considered yours, and you no longer owe copayments for the rental, though you still pay for oxygen contents and certain services. This monthly update cuts through the confusion about when your out-of-pocket costs end.