The Senate’s government funding proposal includes a 30-day delay in PAMA cuts, giving clinical labs more time to prepare for reduced Medicare reimbursement rates.
Tucked into the Senate’s government funding proposal is a modest yet impactful measure that gives clinical laboratories a brief reprieve from PAMA reimbursement cuts.
On Nov. 10, the Senate amended and passed a version of a House funding bill, H.R. 5371, designed to reopen the government and allocate funding across multiple agencies. Among its 394 pages is a 30-day stopgap measure delaying PAMA reimbursement cuts, pushing the effective date from January 1 to January 31, 2026.
“While this 30-day reprieve provides welcome relief and demonstrates growing awareness of the impact these cuts have on laboratories and patient access, our work is far from done,” said Clarisa Blattner, senior director of revenue and payor optimization at XiFin, who was among the first to publicly note the extension via a LinkedIn post.
The Senate provision references updates to Section 1834A of the Social Security Act, known internally as Section 6209. The amendment modifies how CMS phases in payment reductions based on private payer data:
The 2026 calendar year is divided into two periods: January 1–30, 2026, and January 31–December 31, 2026, rather than treating the entire year as a single implementation period.
Reporting windows for private-sector payment data, which inform Medicare rates, are also extended. Instead of ending December 31, 2025, the next reporting period will run from February 1 through April 30, 2026.
These changes give laboratories additional time to prepare, gather, and validate private payer data while adjusting to new reimbursement rates—a key operational relief, especially for smaller and independent labs.
Extra Time to Advance the RESULTS Act
G2 Intelligence also reported that the temporary delay also offers the clinical lab industry a critical window to rally support for the RESULTS Act (Reforming and Enhancing Sustainable Updates to Laboratory Testing Services Act). The bill aims to reform PAMA by reducing reimbursement rate cuts, using an independent database for commercial payer reporting, and lengthening intervals between reporting windows.
Industry observers had warned that Congress was unlikely to again delay PAMA cuts, which have been postponed periodically since the pandemic. The 30-day extension is therefore notable, giving laboratories a short but meaningful buffer to continue advocacy and prepare for upcoming rate adjustments.
Looking Ahead
Laboratory leaders can use this window to assess financial impacts, adjust operational plans, and ensure compliance with updated reporting requirements. As CMS continues to refine its private-payer-based payment system under PAMA, this modest delay offers a critical opportunity to stabilize lab operations and maintain patient access to essential diagnostic services.
The bipartisan RESULTS Act, designed to overhaul Medicare’s payment system for clinical laboratory testing, is on hold amid the ongoing government shutdown. With cuts of up to 15% set to hit 800 common lab tests in 2026, laboratory leaders warn that the delay threatens patient access and lab stability nationwide.
Efforts to reform how Medicare pays for clinical laboratory testing have hit a standstill as the ongoing federal government shutdown freezes legislative progress on Capitol Hill, delaying long-awaited relief for labs facing steep payment cuts in 2026.
The bipartisan Reforming and Enhancing Sustainable Updates to Laboratory Testing Services (RESULTS) Act—introduced in September by Senators Raphael Warnock (D-GA) and Thom Tillis (R-NC)—was gaining momentum as a fix to long-standing problems in the Medicare Clinical Laboratory Fee Schedule (CLFS). But with Congress largely at a standstill, the bill and several other healthcare measures are now in limbo, leaving labs anxious about their financial outlook heading into next year.
At stake are payment reductions of up to 15% for more than 800 commonly ordered laboratory tests, scheduled to take effect on January 1, 2026. Laboratory organizations warn that without swift action, the cuts could destabilize the nation’s diagnostic infrastructure, threaten patient access, and further weaken community and hospital outreach laboratories already strained by workforce shortages and inflation.
Organizations Pen Letter
In a letter sent to congressional leaders on October 30, more than two dozen healthcare and laboratory organizations, including the American Clinical Laboratory Association (ACLA), the College of American Pathologists (CAP), the American Hospital Association (AHA), and the American Medical Association (AMA), urged Congress to pass the RESULTS Act to “protect patient access to clinical laboratory services.”
“Timely access to innovative clinical laboratory tests is critical to the prevention, early detection, therapy selection, and effective management of chronic and life-threatening diseases,” the coalition wrote. “Without action, around 800 laboratory tests will be subject to payment cuts of up to 15% on January 1, 2026, threatening patient access to routine and life-saving diagnostics.”
The letter highlights a decade-long problem stemming from the Protecting Access to Medicare Act (PAMA) of 2014. That law aimed to align Medicare reimbursement with private market rates but relied on limited data reporting—less than 1% of lab data nationwide—resulting in artificially low payment rates. In its first three years alone, PAMA implementation cut nearly $4 billion from the CLFS. Congress has since delayed those cuts five times, but advocates say temporary fixes are no longer sustainable.
“The time for permanent reform is now,” the coalition urged.
Shutdown Leaves Critical Medicare Lab Payment Fix Hanging in the Balance
The RESULTS Act seeks to overhaul the payment process to ensure rates reflect the full diversity of the laboratory market, including independent, hospital outreach, and physician office laboratories. It would reduce administrative burdens on both labs and the Centers for Medicare & Medicaid Services (CMS), cap annual payment reductions at 5% instead of 15%, and extend data reporting cycles to every four years. The bill would also empower CMS to work with an independent third party to collect more representative market data and make rates subject to administrative or judicial review.
Supporters say these reforms would promote innovation and stabilize Medicare reimbursement. Industry groups agree that without reform, continued cuts could push smaller community and regional labs, particularly those serving rural or underserved populations, to close their doors.
ACLA president Susan Van Meter underscored the importance of laboratories in guiding medical decisions. “Clinical laboratories deliver essential information that individuals need to better understand their own health status, while also serving as the backbone of our healthcare system, providing the results that inform 70% of medical decisions,” she said.
ACLA president Susan Van Meter noted, “As our industry continues to innovate and tailor healthcare solutions through personalized medicine, the RESULTS Act is a critical step to safeguard access to these life-saving tools, reinforce our healthcare infrastructure, and support continued innovation in laboratory medicine.” (Photo credit: ACLA)
However, with the government shutdown halting normal committee business and delaying budget negotiations, the RESULTS Act—along with various other bipartisan healthcare bills—remains stuck in legislative limbo. For laboratory leaders, that means more uncertainty and a narrowing window for action before the 2026 cuts take effect.
The coalition letter concluded, “We stand ready to help advance the RESULTS Act to achieve fundamental reform of the flawed Medicare clinical laboratory payment system.”
With the government shutdown now stretching beyond two weeks, clinical laboratory leaders are beginning to feel the pinch. Experts warn that delays in Medicare payments could soon create cash-flow crunches and backlog claims well into November.
As the federal government shutdown stretches into its third week, laboratory leaders are warning of mounting financial pressure and potential payment delays that could disrupt operations and strain cash flow.
While clinical laboratories can continue to submit Medicare and Medicaid claims, the timing of reimbursements could soon become unpredictable. According to William Baus, a laboratory revenue cycle expert, who shared a visual on LinkedIn, “a government shutdown doesn’t stop you from submitting claims—but it can affect when you get paid.”
In his Oct. 11 post, Baus outlined the timeline of expected payment impacts. If the shutdown lasts fewer than 14 days (at the time this piece was written, the government shutdown entered its 17th day), Medicare reimbursements would have remained unaffected, since the Centers for Medicare and Medicaid Services (CMS) typically maintains a 14-day payment floor. But if the shutdown continues beyond that window (which it now has), the system begins to back up quickly.
For a 20-day shutdown, for instance, “payments are delayed about five business days,” Baus noted. Claims submitted October 1 would not pay out until October 21, creating a rolling backlog into November. “Bottom line,” he wrote, “a short shutdown = no impact. A longer shutdown = temporary cash-flow crunch.”
For independent laboratories and pathology groups, especially those with thin operating margins, these delays could create significant short-term liquidity challenges. Many smaller or privately owned labs depend on steady reimbursement cycles to cover payroll, reagents, and lease expenses. Even a week-long delay in large Medicare payments can tighten available cash.
Hospital and health-system labs may have more flexibility, but even they face potential ripple effects if system-wide financial operations slow down or if supply purchases and contractor payments need to be deferred.
Medicaid and ACA Impacts
Ann Lambrix, vice president of revenue cycle management at Lighthouse Lab Services, echoed those concerns in a LinkedIn post of her own, warning that providers should brace for payment delays as the shutdown continues. “Healthcare providers should prepare for potential delays in claim processing and payments from Medicare,” Lambrix wrote. She noted that while “Medicaid [is] funded through Q1 of next year,” proposed cuts to enhanced subsidies “may threaten ACA coverage for individuals choosing to obtain health insurance through marketplace plans.” Lambrix thanked William Baus for his visual summary of the shutdown’s financial ripple effects, underscoring how even temporary disruptions in federal operations can upend reimbursement timelines across the healthcare sector.
Operational Preparedness
Lab leaders should prepare contingency plans, including:
Closely monitoring accounts receivable aging reports for delayed remittances.
Reviewing cash reserves and establishing short-term credit options if needed.
Communicating with vendors and staff about possible timing issues.
Staying in contact with billing vendors and clearinghouses to track any system backlogs.
“Claims can still be submitted and processed electronically,” Baus emphasized, “but the payment cycle may slip depending on how long the shutdown lasts.”
The Takeaway
In the short term, laboratories should brace for administrative slowdowns rather than outright denials. Yet as the shutdown continues, payment backlogs could cascade, especially for labs heavily reliant on Medicare revenue.
For now, experts recommend vigilance, conservative spending, and clear communication with financial teams. As the shutdown persists, even well-run labs could feel the pinch of delayed federal payments before November begins.
Genetic, toxicology, and even routine panels can create pitfalls for clinical laboratories.
Clinical laboratory professionals involved with diagnostic billing and coding should double check claims submitted for routine, toxicology, and genetic testing. Those three testing types are inviting private payer scrutiny and possibly worse.
“Between audits, denials, and government crackdowns, the risks are higher than ever,” said Jamel Giuma, founder and CEO at JTG Consulting Group, a laboratory IT consulting company.
Routine Panels Can Create Headaches for Lab Billing
Giuma explained that when it comes to diagnostic billing and coding, three testing areas often get oversized attention from commercial payers and the Medicare program:
Routine panels. Lab professionals should beware of overordering these types of tests, such as lipid or metabolic panels. High volumes have attracted payer audits, Giuma said. The US Department of Health and Human Services’ Office of Inspector General (OIG) has previously noted investigations where lipid panels were billed with direct low-density lipoprotein cholesterol tests to the same patient on the same day, which the OIG said was medically unnecessary.
Toxicology tests. Some drug testing panels to detect pain management or substance abuse have received scrutiny in 2025 for their ordering frequency.
Genetic testing. Expensive DNA and molecular assays may get an extra look from insurers, particularly services that get tagged with CPT code 81479. The code is a vague catch-all for unlisted molecular pathology procedures. The Dark Report has noted that using 81479 is essentially begging a payer to review the claim. Giuma added that this can be a tricky area for labs developing investigational tests.
Giuma said based on data he has reviewed, payers initially deny one in five clinical lab billing claims. “That is staggering,” he noted.
Jamel Giuma noted that one of every five clinical lab billing claims gets denied by payers, making the submission process a thorny one for laboratories. (Photo credit: JTG Consulting)
Investigators Eye Laboratory Test Fraud
Meanwhile, the OIG, auditors from the Centers for Medicare and Medicaid Services, and investigators from the US Department of Justice also scrutinize diagnostic billing and coding patterns.
“They’re looking for repeat offenders or systematic over-coding,” Giuma said.
Earlier this year, as part of the largest healthcare fraud bust in US history, dozens of clinical laboratories were charged with Medicare fraud for alleged telemedicine and genetic testing schemes where deceptive telemarketing campaigns targeted Medicare beneficiaries.
Even the most scrupulous labs should heed the indictments from the fraud investigations. All laboratories can run into trouble if they don’t stay on top of compliance efforts to detect fraud risks.
Documentation of billing code justifications and claims submissions are a solid first line of defense, Giuma said.
Also, labs should closely monitor prior authorization processes and understand associated rules from payers, he added.
Giuma’s advice emphasizes that diagnostic billing and coding is an area that clinical labs can unnecessarily get snarled in if providers are not careful about how and when they order tests.
Lab leaders warn that without the RESULTS Act, up to 800 common tests could see steep Medicare payment cuts, threatening patient access and community laboratory stability.
Clinical laboratory leaders have been expressing concern over looming Medicare payment cuts they say could destabilize their operations, threaten patient access, and undermine preparedness for future public health crises. With reductions of up to 15% scheduled to take effect in 2026, the introduction of the bipartisan Reforming and Enhancing Sustainable Updates to Laboratory Testing Services (RESULTS) Act is being hailed by lab organizations as a lifeline to preserve financial stability and ensure seniors continue to receive timely, high-quality diagnostic testing.
US Senators Raphael Warnock (D-GA) and Thom Tillis (R-NC), along with a bipartisan coalition of House members, introduced the RESULTS Act on Sept. 10, 2025, to reform how Medicare pays for clinical laboratory services, a move aimed at protecting seniors’ access to essential diagnostic tests and stabilizing the nation’s lab infrastructure.
The legislation seeks to overhaul the payment system established under the Protecting Access to Medicare Act (PAMA) of 2014. While PAMA was intended to align Medicare rates with private insurers, laboratory groups argue that the way the law was implemented resulted in steep, unsustainable cuts. Without reform, payment reductions of up to 15% are scheduled to hit more than 800 commonly ordered tests starting January 1, 2026, and again in subsequent years.
“Access to quality clinical labs is essential to keeping our seniors living long, healthy lives,” said Warnock. “I’m proud to partner with my colleague Senator Tillis to put forward this legislative fix that will help ensure Georgia seniors will continue to have access to high-quality diagnostic services.”
Tillis emphasized that the bill is about long-term stability. “It is critically important that seniors have uninterrupted access to innovative diagnostic tests,” he said. “The RESULTS Act is a necessary step toward ensuring this access and supporting seniors’ healthcare needs. I’m proud to work with my colleagues to permanently fix flawed data collection and reporting methods which will allow Medicare beneficiaries to continue receiving quality and affordable lab services.”
CAP: Current Cuts Would “Undermine” Lab Operations
“The CAP supports congressional efforts to improve the PAMA rate-setting process for clinical lab services and reduce unnecessary burdens on laboratories,” said CAP president Donald S. Karcher, MD, FCAP.
Donald S. Karcher, MD, FCAP, CAP president noted, “Under the current structure dictated by PAMA, the severity of fee reductions would undermine the operational infrastructure of clinical laboratories throughout the United States. The RESULTS Act will mitigate these cuts, avert needless loss in access to care, and allow laboratories to continue providing timely, high quality clinical services for patients. We urge Congress to pass the RESULTS Act before cuts take effect on January 1, 2026.” (Photo credit: CAP)
ACLA: Nearly $4 Billion Cut Already
The American Clinical Laboratory Association (ACLA) also praised the legislation, calling it essential to protect access to both routine and advanced diagnostics. The group noted that implementation of PAMA slashed nearly $4 billion from the Medicare Clinical Laboratory Fee Schedule in just three years.
“When PAMA was implemented, this goal was not achieved, as CLFS [Clinical Laboratory Fee Schedule] rates were set based on data collected from less than 1% of all laboratories, resulting in artificially low payment rates,” ACLA said. Without intervention, “about 820 laboratory tests’ CLFS rates will be cut by up to 15% beginning January 1, 2026, threatening patient access to routine and life-saving diagnostics.”
ACLA president Susan Van Meter underscored the importance of laboratories in guiding medical decisions. “Clinical laboratories deliver essential information that individuals need to better understand their own health status, while also serving as the backbone of our healthcare system, providing the results that inform 70% of medical decisions,” she said. “As our industry continues to innovate and tailor healthcare solutions through personalized medicine, the RESULTS Act is a critical step to safeguard access to these life-saving tools, reinforce our healthcare infrastructure, and support continued innovation in laboratory medicine.”
“NILA applauds the bipartisan introduction of the RESULTS Act and urges Congress to quickly pass this vital legislation to strengthen our nation’s clinical laboratory infrastructure,” said NILA’s executive director Mark S. Birenbaum, PhD. “Our members are facing up to 15% in cuts to many of the most common laboratory tests; without immediate reform to PAMA this year, regional and community clinical laboratories could be forced to close their doors, leaving patients without access to critical laboratory testing.”
Birenbaum added that continued cuts could also erode preparedness for future public health emergencies. “PAMA cuts have weakened our nation’s community and regional clinical laboratories by leaving them without the necessary resources to continue providing essential services to people across the country,” he said. “Further cuts would continue to harm this infrastructure and threaten the ability of clinical laboratories to be prepared for a future pandemic or public health emergency.”
What the Bill Would Do
The RESULTS Act proposes several key reforms:
Adjust data reporting requirements and allow CMS to work with an independent third-party to collect more representative data
Exclude Medicaid managed care organizations from the definition of private payors
Cap annual Medicare payment cuts at 5% instead of 15%, while allowing increases with no cap
Extend the reporting cycle to every four years
Make payment rates subject to administrative or judicial review
Both widely available and more specialized tests would be covered under the new structure, using a mix of independent claims databases and targeted lab reporting to set accurate rates
Supporters say these changes would reduce administrative burden, stabilize Medicare reimbursement, and protect seniors’ access to vital testing.
“Congress has an opportunity this year to ensure long-term stability for the nation’s clinical laboratories,” ACLA’s Van Meter said. “We look forward to working with lawmakers to deliver this urgently needed reform.”
A more in-depth look at the RESULTS Act will be featured in the next edition of The Dark Report. (If you’re not a Dark Report subscriber, check out our 14-day free trial.)
Recent laws in California, Utah, and Texas define new compliance standards for clinical laboratories employing AI in diagnostic and clinical messaging.
When it comes to oversight of artificial intelligence (AI) use in clinical laboratory, it behooves lab leaders to watch what is happening on the state level. In some cases, disclosure of AI use is a threshold states are monitoring.
For example, California Assembly Bill 3030, which went into effect Jan. 1, 2025, mandates transparency when generative AI is used in healthcare. Any health facility, laboratory, clinic, physician’s office, or group practice that employs generative AI to create patient communications about clinical information must include:
A prominent disclaimer stating the content was AI-generated.
Clear instructions that inform patients how to speak directly with a human clinician.
If a licensed provider reviews and approves the AI-generated communication, these requirements are waived. AB 3030 applies only to clinical—not administrative—messages. Non‑compliance can result in disciplinary actions from state regulators.
Laboratories using AI in patient-facing contexts should ensure their workflows include AI‑disclaimers, human‑review triggers, and clear ways for patients to contact providers.
“Symposium Cisco Ecole Polytechnique 9-10 April 2018 Artificial Intelligence & Cybersecurity” by Ecole polytechnique / Paris / France is licensed under CC BY-SA 2.0.
AI Disclosure in Utah
Meanwhile, Utah Senate Bill 226 updates its Artificial Intelligence Policy Act, tightening rules around how healthcare entities—including clinical labs—use generative AI in patient interactions. The rules went into effect May 7, 2025.
Under the state’s law, labs must disclose AI use only when:
A patient explicitly asks whether they’re interacting with AI, or
The lab uses AI in high-risk communications, such as delivering test interpretations, diagnostic results, or clinical advice.
Routine AI use in back-end operations or non-clinical messaging does not require disclosure.
A safe harbor provision protects labs from penalties if the AI system clearly identifies itself as non-human at the beginning and throughout the interaction.
Labs that use AI-generated content in patient portals, chatbots, or outreach must ensure compliance or face consumer protection penalties.
New Texas Law on AI
Texas passed a law in June that goes into effect Sept. 1, 2025, the regulates how AI is used within electronic health records (EHRs).
According to the law, providers that use AI for recommendations on diagnosis or treatment based on a patient’s medical record must review all information obtained through AI to ensure its accuracy before entering the information into a patient’s EHR.
The law also “imposes a strict data localization mandate, prohibiting the physical offshoring of electronic medical records,” law firm Holland & Knight noted. “This requirement applies not only to records stored directly by healthcare providers but also to those maintained by third-party vendors or cloud service providers.”
