Reimbursement Guidelines for Modifier 90

Reference (Outside) Laboratory: Add Modifier 90 to the usual procedure code when a party other than the treating or reporting physician performs the laboratory procedure. In the Medicare program, independent clinical laboratories use this modifier when they refer tests to a reference laboratory for analysis.

Key Takeaways

• Modifier 90 tells the payer that an outside (reference) lab performed the test, even though the physician or referring lab reports it.
• It does not bypass clinical edits, subsets, or bundling rules.
• On the claim, mark Item 20 “Yes,” enter the purchase price, complete Item 32 (NPI, name, address), and list both CLIA numbers.
• Never append it to anatomic pathology services or the drawing fee (CPT 36415). Handling fees (CPT 99000/99001) are not separately payable.
• Bill referred tests and in-house tests on separate claims to avoid denials.

A physician or clinic uses the modifier when an outside or reference laboratory performs a patient’s lab tests. It shows that although the physician reports the test, a separate laboratory performed the actual testing component.

Modifier 90 also applies when the outside lab bills the physician for the service. For example, a physician orders a CBC in the office, draws the blood, and sends the specimen to an outside laboratory. When you bill outside reference laboratory services with this modifier:

• The reference laboratory modifier does not bypass clinical edits, subsets, bundling, etc.
• If the provider performs some blood and/or serum lab procedures in-house and sends others to an outside lab, CPT 36415 is not eligible for separate reimbursement.
• Payers do not reimburse CPT codes 99000 and 99001 (handling fees) separately.

Correct Use of Modifier 90

1. An outside laboratory, unrelated to the treating/reporting physician, performs the procedure.
   • In most cases, the lab that furnishes the service bills the claim.
2. One lab may bill for a service that another lab performed.
   • Referring lab – sends a specimen to another laboratory for testing.
   • Reference lab – receives a specimen from another lab and performs one or more tests on it.
3. Append modifier 90 to the referred laboratory test code.
   • Mark Item 20 “Yes” for outside lab.
   • Enter the purchase price under Item 20 charges.
   • Complete Item 32 with the NPI, name, and address of the lab that performed the test.
4. Include two different Clinical Laboratory Improvement Amendments (CLIA) numbers on the claim:
   • The billing provider’s information
   • The laboratory that performed the services (reference lab)
5. Bill referred tests and in-house tests on separate claims.
6. If there are no purchased services, leave Item 20 blank.

When Not to Use Modifier 90

• Do not report it with anatomic pathology services.
• Do not append it to the drawing fee (CPT 36415).
• A reference lab cannot refer the test out to another lab.

Medical Billers and Coders

Serving more than 40 specialties, Medical Billers and Coders (MBC) handles services ranging from revenue cycle management to ICD-10 testing solutions. Our main goal is to help physicians find skilled billers and coders.

Struggling with Modifier 90 denials or reference lab billing? Contact Medical Billers and Coders today for expert lab billing and coding support.

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Neel M

With almost 12 years of experience in healthcare revenue cycle management, this Revenue Cycle Specialist brings deep expertise in medical billing, claims optimization, and practice profitability. Shares industry-backed insights focused on improving collections, reducing denials, and driving operational excellence.