CMS proposes 16% average cut to Medicare pay for 1,100+ lab codes
CMS released preliminary payment rates for the 2027 Medicare Clinical Laboratory Fee Schedule on September 21, 2026, showing 1,171 of 1,947 test codes would be paid less than in 2026 under the PAMA private-payer-rate reporting cycle. The agency says the cuts average about 16% overall, with molecular pathology and genomic sequencing codes down roughly 22-23%; reductions would phase in at up to 15% a year from 2027 through 2029. CMS estimates the changes save Medicare about $1 billion a year, while the American Clinical Laboratory Association says the new rates are based on private-payer data from only about 2% of labs that bill Medicare Part B. A 30-day comment period is open, with CMS expecting to finalize rates in November 2026.
Why it's notable: Lab reimbursement funds the diagnostic testing infrastructure clinics and hospitals rely on, and a sustained double-digit cut concentrated in molecular pathology and genomic sequencing codes could affect which tests labs can keep offering.