Protecting Access to Medicare Act (PAMA) for Laboratories

In 2014, Congress passed the Protecting Access to Medicare Act, or PAMA (P.L. 113-93), to reform the Medicare clinical laboratory fee schedule (CLFS) to a single national fee schedule based on private market data from all types of laboratories that service Medicare beneficiaries, including independent laboratories, hospital outreach laboratories, and physician office laboratories (POLs). Unfortunately, the first round of data collection in 2017 failed to capture an adequate and representative sample of private market data, leaving out virtually all hospital outreach laboratories and significantly under-sampling POLs. The significant under-sampling led to nearly $4 billion in cuts to those laboratories providing the most commonly ordered test services for Medicare beneficiaries. For context, the total CLFS spend for 2020 was only $8 billion, less than 3% of Medicare Part B spending.

As of February 2026, Congress has intervened on a bipartisan basis seven times to delay the next CLFS reporting periods and six times to delay cuts to maintain access to laboratory services for patients. Most recently, the Consolidated Appropriations Act, 2026 was signed into law, providing a one-year delay in CLFS rate cuts and updating the data reporting timeline. However, without a permanent solution to this problem, laboratories will continue to face uncertainty.

On July 15, 2022, the US Court of Appeals for DC ruled in favor of a motion in a lawsuit by the American Clinical Laboratory Association (ACLA) against the Department of Health and Human Services (HHS) over PAMA implementation. The CAP has strongly supported ACLA's lawsuit against the HHS and efforts to correct the administration’s execution of PAMA’s clinical laboratory payment reforms. ACLA filed the lawsuit in 2017.

The court agreed that the 2016 PAMA regulations were arbitrary and capricious, which is an argument that the CAP made in an amicus brief in support of ACLA’s lawsuit in 2018.

On December 3, 2020, the CAP submitted comments to the Medicare Payment Advisory Commission (MedPAC) in response to issues raised at a MedPAC public meeting around PAMA implementation. The CAP also sent comments to CMS in response to the 2019 Physician Fee Schedule proposed rule urging CMS to make the PAMA methodology changes necessary to include all segments of the industry, thereby ensuring more accurate PAMA rates and continued access to laboratory tests for Medicare patients. The CAP sent the CMS additional comments that outlined concerns from its members on October 23, 2017.

The CAP has also been urging Congress to pass legislation to reduce the administrative burden on laboratories and ensure accurate collection of private market data through statistically valid sampling from all laboratory segments while avoiding drastic cuts to clinical laboratory payment rates. We need to improve how data is collected and validated under PAMA to ensure an accurate, market-based payment system for laboratories paid through CLFS. This would allow laboratories to focus on providing timely, high-quality clinical laboratory services for patients, continuing to innovate, and building the infrastructure necessary to protect public health.

The Consolidated Appropriations Act, 2026 (Section 6226) serves as another patch. This legislation delays CLFS cuts of up to 15% on approximately 800 tests through December 31, 2026.

Crucially, the Act updates the private payor data CMS will use to set CLFS rates for 2027. To ensure improved data reporting, the data collection period has been shifted from 2019 to January 1 – June 30, 2025. Moving to a more recent collection period allows for more accurate reporting, as 2019 data would have been difficult for many laboratories to access.

While this provides short-term relief, the CAP is now working with Congress to ensure that Medicare CLFS rates are permanently stabilized by securing enactment of the RESULTS Act.

Under the Consolidated Appropriations Act, 2026, the timeline for data reporting and rate adjustments is as follows:

• 2026 Rate Cuts: 0% (Delayed through December 31, 2026)
• Data Collection Period: January 1, 2025 – June 30, 2025
• Data Reporting Period: May 1, 2026 – July 31, 2026
• New CLFS Rates Effective: January 1, 2027

The Secretary of HHS is authorized to implement these changes by program memorandum to ensure swift execution. CMS is also preparing a laboratory data reporting education campaign to inform hospital outreach, independent, and physician office laboratories of the requirement to report 2025 data.

Pathologists can encourage their Representatives and Senators to support the RESULTS Act by signing into our Action Center.