CMS Pub. 100-05, ch. 5, § 40.8.6.2

The A/B MAC (Part A) calculates deductible and coinsurance in the usual manner after

applying the primary payer's payment allocated for non-lab services. See examples below

for calculation of coinsurance.

EXAMPLE 1: Deductible Previously Met

Outpatient services were furnished to a Medicare beneficiary for whom the provider

billed $100 for lab services and $200 for emergency room services. The lab fee schedule

amount for the $100 lab services is $70. The beneficiary's Part B deductible was

previously met. The primary payer paid $150 for Medicare covered services without

designating what portion of its payment was for each type of service. Since the ratio of

lab charges to non-lab charges is $100/$200, the A/B MAC (Part A) divides the primary

payer's payment of $150 into two amounts based upon the same ratio: $100/$200 =

$50/$100. It applies $50 of the primary payer's payment to the $70 lab fee schedule

amount and the remaining $100 to the $200 in non-lab charges (emergency room

services). It calculates the coinsurance in the usual manner based upon the $200 non-lab

charges. It does not charge coinsurance since the primary payment of $100 allocated to

non-lab charges is greater than the $40 coinsurance on the $200 in non-lab charges. (For

the PS&R, the A/B MAC (Part A) records $40 coinsurance and $60 primary payment.)

EXAMPLE 2: Deductible Not Met

Outpatient services were furnished to a Medicare beneficiary for whom the provider

billed $100 for lab services and $200 for emergency room services. The lab fee schedule

amount for the $100 lab services is $70. Only $158.00 of the beneficiary's Part B

deductible had been met previously leaving the remaining $75.00 to be met. The

primary payer paid $150 for Medicare covered services without designating what

portion of its payment was for each type of service. Since the ratio of lab charges to non -

lab charges is $100/$200, the A/B MAC (Part A) divides the primary payer's payment of

$150 into two amounts based upon the same ratio: $100/$200 = $50/$100. It applies $50

of the primary payer's payment to the $70 lab fee schedule amount and the remaining

$100 to the $200 in non-lab charges (emergency room services). It calculates the

deductible and coinsurance in the usual manner based upon the $200 non- lab charges. It

does not charge any deductible or coinsurance since the primary payment of $100

allocated to non-lab charges is equal to the $25 coinsurance and $75 remaining

deductible on the $200 in non-lab charges. (For the PS&R, the A/B MAC (Part A)

records $75 deductible and $25 coinsurance.)