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CO-B23 Denial Code: Test Not Authorized Under CLIA

CO-B23 means the procedure billed is not authorized under your Clinical Laboratory Improvement Amendments (CLIA) certification or proficiency testing status. The lab's CLIA certificate doesn't cover that test, or the test wasn't billed in a way that shows it's allowed.

Quick facts

Code
CO-B23 (CARC B23)
Status
Active In use since January 1, 1995; last modified September 30, 2007.
Code set
Claim Adjustment Reason Codes (CARC)
Group codes
  • CO (Contractual Obligation): The standard group. The lab or practice absorbs the denied amount and can't bill the patient.
Official description
Procedure billed is not authorized per your Clinical Laboratory Improvement Amendment (CLIA) proficiency test.
X12 Claim Adjustment Reason Codes, retrieved September 25, 2026
Last verified
against the official X12 list.

What CO-B23 means

CARC B23 says the procedure billed is not authorized per your Clinical Laboratory Improvement Amendment (CLIA) proficiency test. Every lab that tests human specimens in the United States, including a physician office lab, operates under a CLIA certificate. The certificate type determines which tests the lab may perform, and labs doing non-waived testing must participate in proficiency testing for regulated tests.

Payers, especially Medicare, check each lab line against the CLIA number on the claim and the tests that certificate allows. If the test falls outside it, the line is denied with CO-B23.

Certificate types include a certificate of waiver (waived tests only), a certificate for provider-performed microscopy procedures, and certificates of compliance or accreditation for moderate and high complexity testing.

Common causes

  • Waived-only lab billing non-waived tests.
  • Missing QW modifier on a waived test when the payer requires it.
  • Specialty or subspecialty not on the certificate, for example a new test category added without updating CLIA.
  • Wrong CLIA number on the claim, such as a different location’s certificate.
  • Lapsed or expired certificate on the date of service.
  • Reference lab tests billed under your CLIA number instead of by the performing lab.

How to fix it

  1. Look up your CLIA certificate and the specialties and complexity it covers.
  2. Confirm the test’s complexity and whether it’s waived.
  3. If the claim was wrong, fix the CLIA number (box 23 on the CMS-1500) or add the QW modifier in box 24D, then send a corrected claim with resubmission code 7 in box 22.
  4. If a reference lab performed the test, have the performing lab bill it, or follow the payer’s purchased service rules.
  5. If your certificate didn’t cover the test, the denial generally stands. Update your certificate before performing that test again.

How to prevent it

  • Keep CLIA certificates current and matched to the tests each location performs.
  • Update your certificate before adding new test types.
  • Map tests to certificate types in your billing system, including QW modifier rules.
  • Validate lab lines before submission. A Claims Validator can check that a CLIA number is present for lab services.

Specialty notes

Primary care, urgent care, and behavioral health practices performing point-of-care testing, such as drug screens, usually operate under a certificate of waiver and see CO-B23 when a non-waived test is billed.

Remark codes that may appear with CO-B23

  • MA120 (Missing/incomplete/invalid CLIA certification number.): The CLIA certification number on the claim is missing, incomplete, or invalid.
  • M91 (Lab procedures with different CLIA certification numbers must be billed on separate claims.): Lab procedures with different CLIA numbers must be billed on separate claims.
  • N162 (Alert: Although your claim was paid, you have billed for a test/specialty not included in your Laboratory Certification.): Alert that you billed a test or specialty not included in your laboratory certification.
  • CO-B7 (This provider was not certified/eligible to be paid for this procedure/service on this date of service.): The provider wasn't certified or eligible for the service on the date of service.
  • CO-16 (Claim/service lacks information or has submission/billing error(s).): Missing or invalid claim information, used when the CLIA number itself is missing.
  • CO-4 (The procedure code is inconsistent with the modifier used.): Procedure inconsistent with modifier, relevant when a waived-test modifier is missing.
  • CO-170 (Payment is denied when performed/billed by this type of provider.): Denied when performed or billed by this type of provider.

CO-B23 FAQ

What is CLIA?

The Clinical Laboratory Improvement Amendments set federal quality standards for laboratory testing on human specimens. Labs, including physician office labs, need a CLIA certificate that matches the complexity of the tests they perform.

Why would a certificate of waiver lab get CO-B23?

A certificate of waiver allows only waived tests. Billing a moderate or high complexity test, or billing a waived test without the QW modifier where the payer requires it, can cause this denial.

Where does the CLIA number go on the claim?

On the CMS-1500, the CLIA number is typically reported in box 23. On electronic claims it goes in the designated reference segment. Follow payer instructions.

Can I bill the patient for CO-B23?

No. Under CO, the lab absorbs the amount.