Clinical laboratories are facing a difficult Medicare reimbursement environment in 2027 unless Congress approves permanent reform or once again delays scheduled payment cuts.
The warning became clearer when the Centers for Medicare & Medicaid Services (CMS) released its preliminary 2027 Clinical Laboratory Fee Schedule (CLFS) rates. Most clinical diagnostic laboratory test codes for which CMS calculated new private-payer-based rates would receive lower reimbursement next year.
Under current law, reductions are capped at 15% per test annually from 2027 through 2029. Nevertheless, the preliminary rates indicate that many laboratories could experience significant reimbursement pressure beginning Jan. 1. CMS expects to publish final 2027 rates in November.
CMS calculated the preliminary rates using commercial payer data collected during the first half of 2025 and reported by laboratories in 2026. This was the second complete reporting cycle required under the Protecting Access to Medicare Act of 2014 (PAMA).
The agency said participation increased substantially from the first reporting cycle, particularly among hospital outreach and physician office laboratories. However, the updated data did not eliminate the prospect of broad payment reductions.
For clinical laboratory executives, the announcement shifts attention back to Congress. Lawmakers appear to have two principal options: pass legislation restructuring the PAMA rate-setting process or enact another temporary delay before the reductions begin.
Laboratory groups push for permanent PAMA reform
The laboratory industry’s preferred solution is the bipartisan Reforming and Enhancing Sustainable Updates to Laboratory Testing Services (RESULTS) Act.
The legislation, introduced as H.R. 5269 and S. 2761, would change how CMS obtains commercial payment information for widely available tests. Rather than requiring thousands of laboratories to submit their own payer data, CMS generally would obtain paid-claims information from an independent commercial database.
Supporters contend that the approach would produce a more representative picture of the laboratory market while reducing reporting burdens. The legislation also would cancel the pending reductions, freeze CLFS rates during implementation and eventually limit annual cuts to 5%.
Dark Daily has followed the legislation since its introduction in September 2025, when laboratory organizations warned that continued reductions could jeopardize community laboratories and patient access. More recently, Dark Daily reported that ACLA hopes to secure passage by attaching the RESULTS Act to a year-end spending package.
The approaching deadline also has become part of a broader public-access campaign. As reported by Today’s Clinical Lab, a Quest Diagnostics survey found that 74% of registered voters believed Congress should prevent the scheduled reductions. Today’s Clinical Lab also previously covered ACLA’s support for the RESULTS Act and relaunch of its “Stop Lab Cuts” campaign.
The House bill has attracted more than 100 co-sponsors and received an endorsement from the bipartisan Problem Solvers Caucus in July. That support gives laboratory lobbyists additional momentum, but the legislation still must advance through Congress before the end of 2026 to prevent the January reductions.
The American Clinical Laboratory Association (ACLA) has already mounted a national advocacy campaign urging lawmakers to pass the bill.
“Without action from Congress this year, laboratories will be forced to make difficult decisions that affect patient access to the tests clinicians rely on every day,” ACLA President Susan Van Meter said in announcing the campaign.
Congress has repeatedly postponed PAMA reductions rather than enact a permanent solution. Another delay remains possible, particularly if lawmakers include laboratory relief in a broader year-end spending package.
However, CMS’ publication of the preliminary rates gives clinical laboratory leaders a concrete picture of what could happen without legislation. It also strengthens the industry’s argument that Congress must address the underlying payment methodology instead of relying on annual reprieves.
Clinical laboratory and pathology executives should closely monitor the RESULTS Act and year-end congressional negotiations. Unless lawmakers intervene, the Medicare cuts that laboratories have avoided for several years are now scheduled to arrive in 2027.
This article was created with the assistance of Generative AI and has undergone editorial review before publishing.
