Do I need a Visa to step outside of Kunming Airport during my 12 hour layover?

No, you don't need to apply for a visa. You can enjoy the 24 hours visa free policy because your stopover is just 12 hours. However, if you wanna go outside the airport, you need to apply for a Stay Permit at the airport. Complete the "embarkation/disembarkation card", together with your travel documents, boarding pass for the onward connecting flight and travel itinerary, go to the inspection counter of China Immigration Inspection to apply for 24h stay permit. Hope helpful!