Private-payer rates behind CMS’ preliminary 2027 Clinical Laboratory Fee Schedule average about 16% below 2026 Medicare rates. Physician office labs supplied the largest share of the data behind them.
CMS estimates the reset could save about $1 billion a year. The agency opened a 30-day comment period and expects to finalize rates in November, with the new rates taking effect Jan. 1.
Here are six things to know:
1. Of the 1,528 codes with private-payer data CMS reviewed, 1,171 have private-payer weighted medians below their 2026 Medicare rates. Another 186 came in higher and 169 are unchanged.
2. Physician office labs were the largest reporting group, at 3,262 of the 6,411 labs that submitted data. Next came 1,499 other or unknown labs, 875 hospital labs and 775 independent labs.
3. Annual cuts are capped at 15% in 2027, 2028 and 2029 under the Consolidated Appropriations Act, 2026. Tests priced far below current Medicare rates could see several years of cuts in a row.
4. Molecular and genomic tests show the biggest gaps. Private-payer rates are about 23% lower for genomic sequencing, 22% lower for molecular pathology, 19.3% lower for microbiology and immunology and about 16% lower for chemistry.
5. Hospital lab participation jumped from 21 labs in 2017 to 875 this cycle.
6. The American Clinical Laboratory Association has argued that the original rate-setting method contributed to nearly $4 billion in cuts from 2018 through 2020.
At the Becker’s 32nd Annual Meeting: The Business and Operations of ASCs, taking place October 29-31 in Chicago, ASC leaders, surgeons and healthcare executives will explore strategies to drive growth, enhance operational performance, navigate reimbursement challenges and prepare for the future of ambulatory surgery. Apply for complimentary registration now.
