Revised Clinical Laboratory Fee Schedule and ZIP Code File to Include New Kansas Payment Locality Structure

This article is based on CR 6787 which instructs the Medicare contractors to incorporate an additional Kansas payment locality in the Clinical Laboratory Fee Schedule (CLFS) into their system to ensure correct pricing for certain laboratory claims submitted with a “90” modifier for services performed in the Kansas payment localities.

CMS discovered that there is an inconsistency in the payment rates for claims submitted with Kansas ZIP codes in an east Kansas locality for reference laboratory claims. While regular laboratory claims are being paid correctly, reference laboratory claims are not being paid at the correct rate. CR 6787 corrects this deficiency.

To correct this problem for 2010 and after, CMS has added new payment localities in the 2010 Clinical Lab Fee Schedule. The 2010 ZIP code file refers to two Kansas lab localities to correct this inconsistency. This allows reference laboratory services performed in Johnson and Wyandotte counties to be paid at the NWMO rates. For 2010, CMS provided a CLFS which included two payment locality numbers for East and West Kansas as follows:

  • Contractor #05202/Locality 12 indicates West Kansas, and
  • Contractor #05202/locality 15 indicates East Kansas.

The 2010 ZIP code files were also revised to reflect these 2 state codes as “EK” for East Kansas and “WK” for West Kansas.

CR 6787 provides instructions for correcting the inconsistency for dates of service prior to 2010, and instructs claims processing contractors to incorporate the above changes into the CLFS and use the 2010 ZIP code file to process claims with dates of service prior to 2010.

Note: Medicare will adjust, as necessary, claims submitted by providers in the affected localities with dates of service in calendar years 2008 and 2009. If a provider presents a claim prior to calendar year 2008 with a 90 modifier with proof that the claim was paid incorrectly, Medicare Contractors will adjust the claim on a claim by claim basis.

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