Preliminary CMS data show lower weighted median rates for more than 1,100 laboratory test codes, with payment reductions capped at 15% annually from 2027 through 2029.
The Centers for Medicare & Medicaid Services (CMS) has released preliminary weighted median private payor rates for the 2027 Clinical Laboratory Fee Schedule (CLFS), with new private payor data pointing to lower rates for a majority of laboratory test codes included in the analysis.
CMS calculated weighted median private payor rates for 1,528 of 1,947 applicable test codes based on data submitted during the second full reporting cycle under the Protecting Access to Medicare Act of 2014 (PAMA). Of those codes, 1,171 had weighted median rates below their 2026 CLFS rates, while 186 were higher and 169 were unchanged. Overall, the potential change from 2026 rates averaged approximately 16% lower, according to CMS. CMS estimates that bringing Medicare payments more closely in line with private payor rates would save approximately $1 billion annually.
The preliminary changes varied by test category. Weighted median rates were 16% lower for chemistry tests, 19.3% lower for both microbiology and immunology tests, 22% lower for molecular pathology tests, and 23% lower for genomic sequencing procedures. Proprietary Laboratory Analyses had a smaller potential reduction of 2.4%.
Payment Reductions Capped at 15% Annually
The preliminary weighted medians will not necessarily translate into equivalent payment reductions in 2027. CMS says the proposed changes are intended to bring Medicare payments more closely in line with private sector rates. Under changes enacted in the Consolidated Appropriations Act, 2026, reductions will be phased in from 2027 through 2029, with payment for an individual test prohibited from decreasing by more than 15% in a single year compared with the previous year’s rate.
The rates are based on private payor data collected from Jan. 1 through June 30, 2025, and reported to CMS between May 1 and July 31, 2026. This marks the second full PAMA reporting cycle for most tests after Congress delayed subsequent reporting rounds following the first cycle, which was based on 2016 data and generally took effect in 2018.
Participation expanded substantially in the latest reporting cycle. CMS received data from 6,411 laboratories, up 230% from 1,942 in the first reporting cycle. Hospital laboratories accounted for approximately 13.6% of reporting labs in 2026, compared with 1.1% in 2017. CMS attributed the increased hospital participation in part to regulatory changes made in 2019.
CAP Calls for Changes to CLFS Rate Setting
Following the release of the preliminary rates, the College of American Pathologists (CAP) renewed its call for Congress to change the way Medicare laboratory payment rates are determined and enact the Reforming and Enhancing Sustainable Updates to Laboratory Testing Services (RESULTS) Act.
“The 2027 Clinical Laboratory Fee Schedule rates reinforce what laboratories and pathologists have known for years: The current payment system is not sustainable,” says Qihui “Jim” Zhai, MD, FCAP, president of CAP, in a statement. “Cuts of this scale threaten the stability of the laboratory infrastructure that patients and physicians rely on for accurate and timely diagnoses.”
Zhai says CAP supports congressional efforts to address the payment system and is urging lawmakers to enact the RESULTS Act, which the organization says would change the CLFS rate-setting process to better reflect the laboratory market and protect access to diagnostic services.
CMS Seeks Comments Before Final Rates
For existing tests for which CMS received no applicable private payor information, the agency held a public meeting Sept 15–16 to receive input on how those tests should be priced. CMS says those determinations will be published in early October, followed by a 30-day public comment period.
CMS is also accepting public comments on the preliminary CLFS rates and supporting data for 30 days following their publication. The agency expects to publish final 2027 CLFS rates in November, with the rates taking effect Jan. 1, 2027.
