March 2, 2017
The Centers for Medicare and Medicaid Services (CMS) recently made a change related to codes accepted for hospital outpatient lab services. On December 22, 2016, CMS ended use of modifier L1 for dates of service January 1, 2017 and after. The modifier has been deleted by CMS as a valid modifier and has been removed from Healthcare Common Procedure Coding System (HCPCS) code set, maintained by CMS. Read more about the CMS changes (page 3).
Premera follows CMS's updated policy, even if our agreement with you states a different process. If you have questions about your contract, contact your Provider Network Executive.
What to know about the coding change
Before creating modifier L1, CMS published hospital outpatient clinical diagnostic laboratory test payment and billing guidelines. Premera continues to follow these established guidelines when processing hospital outpatient lab services. Read the guidelines (published in 2014).
CMS now uses conditional packaging as a mechanism to package labs submitted with other services and to allow the lab when it is the only service submitted. At this time, Premera is not using conditional packaging. Premera continues to allow the use of bill type 14x when providers meet CMS criteria for separate reimbursement of clinical lab services.
Providers may use a 14X bill type when:
- The test involves a non-patient laboratory specimen (patient is not present at the hospital).
- The hospital only provides a lab test to the patient, and the patient doesn't receive other outpatient services for the encounter.
For more information on these coding changes, visit the CMS website.