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Why is liquid oxygen being discontinued? The complex reasons behind its declining availability

5 min read

According to the American Association of Respiratory Care, the use of liquid oxygen among Medicare recipients dropped by 80% between 2010 and 2020, even as respiratory disease prevalence remained unchanged. The dramatic decline in the availability of liquid oxygen isn't due to safety concerns or a lack of clinical need but is instead a complex issue rooted in healthcare economics and technological shifts. This situation has profoundly impacted thousands of patients with severe respiratory conditions who rely on this therapy for high-flow, mobile oxygen support.

Quick Summary

The phase-out of portable liquid oxygen for many patients is due to unfavorable Medicare reimbursement policies, which made it unprofitable for durable medical equipment companies to supply. This has led to a major shift towards more cost-effective alternatives like oxygen concentrators, despite clinical drawbacks for certain users.

Key Points

  • Medicare Reimbursement Cuts: The primary reason for the decline of liquid oxygen was changes to Medicare's reimbursement structure through competitive bidding, which made it unprofitable for providers.

  • Economic Non-Viability: Due to the high costs associated with delivery, specialized servicing, and equipment, DME companies could not make a profit on LOX at the standardized reimbursement rate and ceased offering it to most patients.

  • Rise of Portable Concentrators: Advances in portable oxygen concentrator (POC) technology have introduced a more cost-effective and convenient alternative for many, though not all, oxygen users.

  • Patient Impact: The loss of liquid oxygen access has negatively impacted thousands of patients with severe respiratory disease, limiting their mobility and independence.

  • Advocacy for Reform: Patient advocacy groups, including the American Lung Association, are actively campaigning for legislative reform to address the oxygen access crisis caused by these reimbursement issues.

  • Technological Limitations: While concentrators offer unlimited oxygen supply, they typically provide a lower flow rate than LOX, making them unsuitable for some high-flow patients.

  • Future Innovations: The future of oxygen therapy will likely see further improvements in POC technology, as well as the integration of smart monitoring and personalized care.

In This Article

Understanding the Shift Away from Liquid Oxygen

For many years, portable liquid oxygen (LOX) was the gold standard for patients with high-flow oxygen needs who desired mobility. Its ability to store a large amount of oxygen in a lightweight, portable device provided an unparalleled level of freedom for individuals with severe respiratory diseases. However, patients today find themselves facing a stark reality: LOX is becoming increasingly difficult, if not impossible, to acquire. The reasons for this shift are not based on medical necessity, but rather on significant changes in the healthcare market and advancements in competing technologies.

The Impact of Medicare Competitive Bidding

The primary driver behind the decline in liquid oxygen availability is the implementation of Medicare's competitive bidding program. The program was introduced to lower costs for durable medical equipment (DME), including oxygen systems. However, its unintended consequences effectively gutted the LOX market for individual patients.

Under the program, all types of supplemental oxygen systems were reimbursed at a single, blended rate, regardless of the significant differences in their costs. LOX is inherently more expensive to provide than other forms of oxygen for several reasons:

  • High Manufacturing and Delivery Costs: LOX requires cryogenic fractional distillation of air and specialized, costly infrastructure for home delivery and servicing.
  • Higher Upfront Equipment Costs: The equipment for LOX, including stationary reservoirs and portable units, has a higher initial investment compared to concentrators.
  • Systemic Financial Loss: Because the reimbursement rate did not cover the higher costs of providing LOX, many DME companies found it was no longer profitable to offer it to individual patients.

As a direct result of this financial pressure, many DME companies either stopped carrying LOX altogether or reserved their limited supply for large-scale institutional clients, leaving thousands of patients without access. The American Lung Association has noted that the infrastructure for providing LOX to individuals has essentially collapsed.

The Rise of Portable Oxygen Concentrators (POCs)

Simultaneously, technological advancements have created more efficient and user-friendly alternatives to LOX. Portable Oxygen Concentrators (POCs) have emerged as the dominant technology for ambulatory oxygen therapy, presenting several advantages that appeal to both providers and patients.

Unlike oxygen tanks that store compressed or liquid oxygen, POCs are electronic devices that filter and concentrate oxygen from the surrounding air. This fundamental difference has several implications:

  • Unlimited Supply: As long as a POC has battery power or is plugged in, it can provide a continuous supply of oxygen. This eliminates the need for frequent and inconvenient home deliveries required for traditional oxygen systems.
  • Reduced Fire Hazard: Because POCs don't store pure, compressed oxygen, they minimize the fire risk associated with leaky tanks creating an oxygen-enriched atmosphere.
  • Increased Portability: Modern POCs are lightweight, compact, and designed for travel, with many newer models even being FAA-approved for in-flight use. This offers a level of mobility that bulky tanks cannot match.

While POCs are an excellent solution for many, they are not a universal replacement. They typically deliver oxygen in a pulsed-dose fashion and may not meet the high continuous-flow needs of all patients, especially those with severe lung disease. For these individuals, the forced switch from LOX can lead to a significant decrease in their quality of life, limiting their ability to leave home.

The Human Cost of Market Forces

The impact of this shift is most acutely felt by patients. Many who have relied on LOX for years have had their equipment replaced with less suitable alternatives, often a heavy and cumbersome compressed oxygen tank. This change has confined many to their homes, stripping them of the independence that LOX once provided. Stories shared by patient advocacy groups highlight the emotional toll this has taken, with patients reporting increased anxiety and social isolation. Advocacy efforts, such as the American Lung Association's push for the Safeguarding Access to Respiratory (SOAR) Act, aim to reform reimbursement policies to ensure patients receive the oxygen therapy most appropriate for their clinical needs.

A Comparative Look at Oxygen Systems

Feature Liquid Oxygen (LOX) Portable Oxygen Concentrator (POC) Compressed Gas Cylinders
Oxygen Purity Up to 100% pure. Typically up to 95% pure. Up to 100% pure.
Portability Excellent. Lightweight, small portable units filled from a large home reservoir. Excellent. Modern units are very lightweight and compact. Poor. Tanks are bulky, heavy, and offer limited duration..
Flow Rate Can support very high, continuous flow rates necessary for severe conditions. Primarily pulsed-dose, though some models offer low continuous flow. May not suffice for high-flow needs. Can provide continuous flow but tank size and duration are limiting.
Duration Long duration on portable units; duration depends on flow rate and reservoir size. Limited by battery life; unlimited when plugged into a power source. Limited duration, requiring frequent refills or exchanges.
Power Source None required for use. Relies on the natural conversion from liquid to gas. Requires electricity to operate and recharge batteries. None required.
Refilling Patient-refilled from a large stationary home reservoir, which is delivered by a provider. Never needs refilling; draws oxygen from ambient air. Refilled or exchanged by a provider.
Availability Extremely limited for individual patient use due to poor reimbursement. Widely available and becoming the industry standard due to cost-effectiveness. Widely available, but heavy and inconvenient for mobility.

Conclusion

The decline in liquid oxygen availability is not an issue of its clinical effectiveness or patient demand, but rather an economic fallout from evolving healthcare policies and the simultaneous maturation of competing technology. The shift away from LOX has left a critical gap in care for the most severely affected respiratory patients, who relied on its unique combination of high flow and extended portability to maintain their quality of life. While modern portable oxygen concentrators offer a viable solution for many, the inability to access high-flow mobile oxygen represents a significant step backward for a vulnerable patient population. The ongoing push for oxygen reform is a testament to the need for a reimbursement system that prioritizes patient-centered care over pure economics, ensuring that all patients can receive the therapy that best suits their individual needs.

Future Outlook for Oxygen Therapy

The landscape of oxygen therapy is expected to continue evolving, with technology playing an increasingly central role. Innovations in POCs are set to make them even more lightweight, energy-efficient, and capable of higher flow rates. Smart technology and telemedicine will enable better remote monitoring and personalized care, offering real-time data to providers. Furthermore, research into novel delivery methods, such as nanotechnology-based carriers, promises even more discreet and efficient ways to deliver oxygen in the future. While these advancements are promising, they underscore the need to address the systemic issues that led to the decline of LOX, ensuring that future care remains both technologically advanced and accessible to all who need it.

Frequently Asked Questions

Medicare introduced a competitive bidding program for durable medical equipment (DME) in the early 2000s to control costs. Under this system, a single, blended reimbursement rate was set for all types of oxygen systems, regardless of their significant cost differences in manufacturing and delivery.

While not entirely gone, access is extremely limited for individual patients. The infrastructure for home delivery has largely collapsed, and most DME companies only offer LOX to institutional settings like hospitals, where volumes make it more financially viable.

Alternatives like compressed gas tanks and portable oxygen concentrators (POCs) have limitations. Compressed tanks are heavy and bulky, providing limited duration, while POCs may not meet the high, continuous-flow oxygen needs of all patients.

A POC is an electrical device that filters and concentrates oxygen from ambient air, providing a continuous supply as long as it has power. LOX, in contrast, is stored in a highly-pressurized, super-cooled liquid form and gradually converts to gas for the patient to breathe.

No, LOX is not inherently more dangerous, but it does carry specific risks due to its cryogenic nature. Exposure can cause severe frostbite, and leakage creates a fire hazard by enriching the surrounding air with oxygen. These are managed with proper handling and storage protocols.

Patient advocacy groups, such as the American Lung Association and the Pulmonary Hypertension Association, are working to raise awareness in Congress and with the Centers for Medicare and Medicaid Services (CMS). They advocate for reimbursement reform to ensure patient needs drive oxygen therapy access.

For patients with severe respiratory conditions who need high-flow, continuous oxygen, the unavailability of lightweight, portable LOX tanks significantly reduces their mobility. This can lead to increased social isolation, anxiety, and a more sedentary lifestyle.

Yes, significant advancements are expected in portable oxygen concentrators (POCs), which are becoming lighter, more efficient, and smarter through the integration of AI. Researchers are also exploring nanotechnology for advanced oxygen delivery.

Medical Disclaimer

This content is for informational purposes only and should not replace professional medical advice.