STOP LAB CUTS

Screening and diagnostic tests performed by clinical laboratories inform life’s most important health care decisions.

Scheduled reimbursement cuts under the Protecting Access to Medicare Act (PAMA) could jeopardize access to many of the clinical laboratory tests that are used to screen, diagnose, monitor, and manage common diseases for all patients, including more than 60 million seniors.

But the threat doesn’t stop there. After three rounds of up to 10 percent cuts, planned payment reductions of up to an additional 15 percent in 2026 could weaken the clinical lab infrastructure, making it more difficult to deliver routine health care and respond to the next public health crisis. Strong clinical laboratories are foundational to the U.S. health care system.

Medicare reimbursement cuts also curtail investment in the next generation of diagnostic tests, including those that enable personalized care for diseases like cancer.

IMPACT ON PATIENTS

Clinical laboratory tests play a critical role in health care. Without congressional action, about 800 tests will face payment cuts next January. Learn more about how these tests are used and the potential impact of Medicare cuts on patients:

THE PROBLEM

Congress passed the Protecting Access to Medicare Act (PAMA) in 2014. The legislation was designed to align Medicare payment for clinical labs with private insurer rates across the country. Unfortunately, the private payer data collected to inform Medicare payment rates was not representative of the broader laboratory ecosystem, leading to deeper than expected payment cuts to labs. In three consecutive years, labs experienced up to 10% cuts, almost $4 billion, far greater than Congress’s scorekeeper, the Congressional Budget Office, originally projected. Another round of up to 15% cuts are scheduled for January 2026.

Without congressional intervention this year, laboratories across the country will face tough decisions potentially reducing services offered to patients and curbing investment in the next generation of diagnostic tests. Physician offices may stop offering essential laboratory tests, and independent laboratories could be forced to close. These cuts will impact the most common laboratory tests in health care, including those used for the management of heart disease, diabetes, cancer, and many other common and complex health conditions. In short, these scheduled Medicare cuts will undermine laboratory infrastructure essential for day-to-day care and critical to public health emergencies, while also stifling investment to advance innovative new screening and diagnostic tests.

Congress has acted on a bipartisan basis five times to “press the brakes” on harm caused by PAMA, and now is the time to put lab payment policy on the right trajectory for the long-term, with congressional action before the next round of cuts go into effect in January 2026. The outcome of these cuts is predictable: Delayed and disrupted care could lead to the worsening of health care status for at-risk and vulnerable seniors.