Clinical laboratories face renewed Medicare payment uncertainty as a congressional funding impasse threatens to derail temporary PAMA relief, with new CLFS cuts scheduled to take effect in days unless lawmakers act.
Clinical laboratories are once again facing near-term Medicare payment uncertainty as congressional negotiations over a must-pass spending package stall, putting temporary relief from PAMA-driven cuts at risk just days before new reductions are scheduled to take effect.
The American Clinical Laboratory Association (ACLA) is closely tracking bipartisan, bicameral negotiations tied to a broader government funding deal that includes provisions to delay further cuts to the Medicare Clinical Laboratory Fee Schedule (CLFS). The proposal would push back additional PAMA-related reductions until Jan. 1, 2027, and update the private payor data CMS uses to set future Medicare rates. Without action, lab test reimbursement rate cuts are scheduled to go into effect on Jan. 31.
ACLA Backs PAMA Relief but Warns Structural Flaws and Imminent CLFS Cuts Remain
ACLA President Susan Van Meter said lawmakers appear increasingly aware of the structural flaws baked into PAMA’s rate-setting framework.
“ACLA appreciates that lawmakers on both sides of the aisle recognize the serious and ongoing problems posed by PAMA,” Van Meter said in a statement provided by the organization. (Photo credit: ACLA)
She emphasized that shifting the data collection period to more recent market information would represent a meaningful, though incomplete, step forward.
Under the legislative language outlined in the bill, Congress would revise the PAMA phase-in schedule by extending payment reduction caps through 2029, rather than allowing steeper cuts to resume sooner. The bill would also replace the 2019 private payor data CMS is currently set to rely on with data from 2025, addressing longstanding concerns from laboratories that Medicare rates are being calculated using outdated and unrepresentative commercial payment information.
“Updating the data collection period from 2019 to 2025 would move Medicare payment rates away from reliance on seven-year-old market data that would otherwise be used to set 2027 rates,” Van Meter said, according to the statement from ACLA. However, she cautioned that even with updated timelines, “CMS is unlikely to receive comprehensive and representative commercial data needed to set accurate Medicare rates.”
The stakes for laboratories are immediate. Without congressional action, new CLFS cuts of up to 15 percent on roughly 800 tests are scheduled to take effect on Jan. 31, adding to what ACLA described as “three previous rounds of reductions.” Lab professionals have repeatedly warned that cumulative cuts threaten the sustainability of community-based testing and could restrict patient access, particularly in rural and underserved areas.
PAMA Relief Tied to High-Stakes Funding Fight, Leaving Labs in Legislative Limbo
The PAMA provisions are embedded in a larger government funding package that now faces political headwinds. As reported in The Washington Post, Senate Democrats have indicated they will block the broader spending deal unless it is restructured, raising the possibility of a partial government shutdown. While the dispute centers on Department of Homeland Security (DHS) funding, failure to advance the package would also stall health-related provisions, including laboratory payment relief. There has been discussion about separating votes for DHS and Health and Human Services (HHS) spending, but it is not clear yet whether that will happen. The PAMA delays are tied into the HHS spending package.
That linkage is raising concern across the laboratory sector, where advocates argue that PAMA relief has long enjoyed bipartisan support and should not become collateral damage. Van Meter urged lawmakers to move quickly, calling the proposal “a down payment toward lasting PAMA reform” and pressing Congress to advance the bipartisan RESULTS Act this year.
For lab professionals, the outcome of the funding negotiations will determine whether temporary relief materializes—or whether another round of PAMA cuts proceeds as scheduled, further reshaping the Medicare testing landscape just as laboratories continue to adapt to tightening margins and rising operational costs.
Nearly 90% of patients express interest in predictive lab tests, according to a new national survey—creating new opportunities and challenges for clinical laboratories navigating consumer demand, data fragmentation, and Medicare payment cuts.
A new national survey of 1,000 US patients points to a significant shift in how consumers view diagnostic testing—one that has direct implications for clinical laboratories navigating financial pressure, patient engagement, and changing care models.
The YouGov survey, commissioned by Siemens Healthineers, found that patients increasingly expect greater control over when and why lab tests are ordered. Among adults who have had lab work in the past two years, 93% said they expect their physician to order a test upon request. More than a third (37%) have asked for testing based on information from personal research, such as advice from family, friends, or online sources, and 17% have made requests influenced by social media content. For lab leaders, the data signal a move away from strictly symptom-driven, clinician-initiated testing toward more consumer-driven demand.
Patients Push for Predictive Testing, Testing Provider Authority
Interest in predictive and proactive testing is especially high. Nearly nine in 10 respondents (89%) said they are interested in lab tests that can help predict future health risks. That interest is already translating into action: 27% of patients reported pursuing blood testing from a trusted lab provider out of curiosity, without a physician’s recommendation. Another 22% said they had used at-home or self-tests—such as genetic, fertility, or hormone tests—out of curiosity. While self-testing remains less common than lab-based bloodwork, the trend underscores a growing appetite for earlier insights into health status.
Despite this increased autonomy, trust in clinicians remains strong, though not absolute. While 95% of respondents said they trust their provider to order the most appropriate tests, that confidence drops when a requested test is declined. Thirteen percent said they do not trust their doctor’s guidance if advised against a test they asked for, highlighting a delicate balance for providers and laboratories as patient satisfaction and evidence-based medicine increasingly intersect.
“It’s clear: patients want more control over their health and information about their health earlier,” said Michele Zwickl, head of laboratory solutions for Diagnostics at Siemens Healthineers North America. (Photo credit: Siemens Healthineers)
Data Gaps and Cost Pressures Challenge Labs
The survey also raises concerns about data fragmentation. Nearly half (49%) of patients who pursued testing out of curiosity said they did not share their results with a healthcare provider. Additionally, 20% reported they would not disclose to their doctor if they had followed medical advice from social media. For laboratories, this lack of transparency can complicate result interpretation, particularly when undisclosed supplements, diets, or alternative therapies may influence lab values.
Cost remains a major fault line. While many patients are willing to pay out of pocket for elective or curiosity-driven testing, affordability remains a barrier for essential care. Among respondents with unpaid medical bills, 52% said their debt included unpaid lab testing fees. Still, patients clearly value laboratory diagnostics: 98% said lab results provide meaningful health insights, and 94% reported they are more likely to follow a physician’s advice when it is supported by test results. Notably, patients are far less willing to delay bloodwork due to cost than other services—only 5% would postpone lab tests, compared with 22% who would delay imaging.
These expectations come as laboratories face mounting reimbursement pressure. Upcoming Medicare payment cuts of up to 15% for roughly 800 tests, combined with prior reductions under PAMA affecting 72% of commonly used assays, threaten to widen the gap between patient demand and lab capacity. Industry leaders warn that continued cuts could stifle innovation and limit access. Legislative efforts such as the RESULTS Act are gaining attention as potential mechanisms to stabilize reimbursement and preserve testing access.
For lab leaders, success will hinge on aligning growing patient demand for access and insight with operational and financial sustainability.
This article was created with the assistance of Generative AI and has undergone editorial review before publishing.
The trade association is publicly promoting the benefits of biomarker testing and AI’s benefits to diagnostics
One of the core tenets to getting federal lawmaker support for business is to tell them what an industry does. In that vein, the American Clinical Laboratory Association (ACLA) has released a new promotion that highlights applications of companion diagnostics, rapid whole genome sequencing, drug screening, biomarker testing, and infectious disease management.
One of the end goals? To sway Congress to take action against proposed reimbursement cuts to clinical lab test rates.
The ACLA campaign, known as the “Power of Knowing,” took center stage during a panel discussion at the ACLA Annual Meeting, held Feb. 27 in Washington, DC. One objective, panelists said, is to draw attention to the profession’s role in prevention and early detection of diseases, according to report from Medtech Insight.
“The association is working hard to demonstrate to policymakers the value of clinical laboratory testing through the Power of Knowing as they make policy decisions on reimbursement and clinical laboratory infrastructure that’s necessary for robust patient access to these innovative diagnostics,” said panel moderator Elyse Oveson, according to Medtech Insight. Oveson serves as ACLA chief of advocacy operations.
In March 2024, ACLA released digital ads urging Congress to pass the Saving Access to Laboratory Services Act (SALSA), which would have prevented a 15% cut in Medicare reimbursement for approximately 800 laboratory tests.
“A sustainable reform of the Medicare payment system for clinical laboratory services is vital to protect and enhance patient care, foster innovation, and ensure the stability of clinical laboratories nationwide,” ACLA president Susan Van Meter said at the time.
“If patients don’t have their biomarkers profiled for them at diagnosis and again at progression, there’s a very real chance that they would be put on the incorrect therapy that could lead to them having real harm in their health. So, we view biomarkers as critical,” said Nikki Martin (above), senior director of precision medicine initiatives for the LUNGevity Foundation, during the 2025 ACLA Annual Meeting. (Photo copyright: LinkedIn.)
Martin told attendees that biomarker tests should be part of the standard of care in lung cancer diagnosis, Medtech Insight reported. These tests analyze blood or other patient samples to identify molecules associated with specific diseases.
“For patients with non-small cell lung cancer, biomarkers are everything,” said Martin during the panel discussion. Many patients with advanced metastatic cancer, she said, “are not receiving comprehensive biomarker testing, and if they’re not, then they’re at risk of having much worse outcomes.”
Edelmayer discussed progress in developing biomarker tests for early diagnosis of Alzheimer’s disease. “The momentum is palpable among the research community,” she said. “We’re now starting to see the shift into implementation and more types of tools and technologies being available to clinicians to help patients.”
However, Edelmayer acknowledged that progress in developing Alzheimer’s tests and treatments has been slow.
“There’s never going to be a single test to help diagnose Alzheimer’s disease,” she said. “We recognize that it’s going to be a combination approach.”
New Video Campaign
The campaign’s latest advertising is summed up in a 90-second sizzle reel in which clinical laboratory leaders discuss various ways in which the profession supports healthcare.
One theme in the video is the growing use of artificial intelligence (AI) in the profession. “AI-enabled diagnostics are tools that use machine learning to analyze vast amounts of data from patient records to genomic profiles,” said Kate Sasser, PhD, chief scientific officer of Tempus, in the video. “These systems can recognize patterns in the data that humans may not easily see and help clinicians detect diseases earlier and more accurately.”
“By harnessing these cutting-edge tools, we can move closer to a world where treatments are no longer one size fits all but are instead tailored to the unique genetic and molecular profile of each patient,” said Elias Zerhouni, MD, president and vice chairman of OPKO Health, in a recent video produced as part of the ACLA’s Power of Knowing campaign.
The campaign website includes additional videos as well as downloadable graphics that can be shared on social media.
Two former FDA commissioners who support changing oversight of laboratory-developed tests (LDTs) say FDA’s regulatory playbook is ‘outdated’
Congress’ attempts to avoid a government shutdown due to a lack of funding presents a final chance this year for two different clinical laboratory bills to be pushed through.
As Dark Daily’s sister publication The Dark Report, noted in “VALID and SALSA Acts Still Pending in Congress,” a standalone vote on either bill is unlikely this year. Instead, they would need to be attached to the larger spending bill. (If you’re not a subscriber to The Dark Report, check out our free trial.)
In an article for STAT, former FDA Commissioners Scott Gottlieb, MD (left), and Mark McClellan, MD, PhD (right), wrote, “The FDA is currently working from an outdated regulatory playbook that has left gaps in its oversight of safety and effectiveness and makes it more difficult to introduce new innovations. The [VALID Act] would strengthen protections for consumers and patients for both diagnostic tests and cosmetics and make it easier for manufacturers to introduce better products.” (Photo copyrights: FDA/American Well.)
Political Parties Negotiating
At press time, a draft spending bill had not yet been introduced to Congress as lawmakers from both political parties negotiate funding levels.
A source told The Dark Report that until legislators hammer out those details, add-ons such as the VALID Act or SALSA are stalled. There is no guarantee either lab measure will be added to the spending bill.
“We don’t have agreements to do virtually anything,” said Senate Minority Leader Mitch McConnell (R-KY) to reporters on Dec. 6, according to Reuters. “We don’t even have an overall agreement on how much we want to spend,” he added. Reuters reported that Democrats and Republicans in the Senate were $25 billion apart in their proposals.
Congress could also pass a continuing resolution to keep the government open for a short time, which would allow lawmakers more opportunity to negotiate.
Former FDA Chiefs Weigh In
Meanwhile, proponents of the VALID Act have publicly turned the heat up for the bill. For example, STAT recently ran two commentaries—including a joint piece from a pair of former FDA commissioners—in support of the VALID Act.
Currently, LDTs are regulated through the Clinical Laboratory Improvement Amendments of 1988 (CLIA). However, supporters of the VALID Act argue that the complexity of modern LDTs deserves more scrutiny.
“The VALID Act would create a consistent standard for all tests, regardless of the kind of facility they were developed in or made in, as well as a modern regulatory framework that’s uniquely designed for the recent and emerging technologies being used to develop tests,” wrote Scott Gottlieb, MD, and Mark McClellan, MD, PhD, in STAT on Dec. 5.
Gottlieb and McClellan served as FDA commissioners from 2017-2019 and 2002-2004 respectively. They both currently serve on various boards for biotech and healthcare companies.
Pathologists, Clinical Lab Directors Express Concerns about VALID Act
Opponents of the VALID Act contend that LDT innovation will be stifled if clinical laboratories, particularly those at academic medical centers, need to spend the time and money to go through formal FDA approval. There is evidence that working pathologists in academic settings have legitimate concerns about the negative consequences that might result if the VALID Act was passed as currently written.
In “Might Valid Act Support Be Waning in Congress?” The Dark Report covered how on June 1 more than 290 pathologists and clinical laboratory directors sent a grassroots letter to a Senate committee asking for a series of concessions to be made for academic medical center labs under the VALID Act.
It is reasonable to assert that the majority of clinical laboratory professionals and pathologists are supportive of the SALSA bill, which would stop the next round of scheduled price cuts—as much as a 15% price reduction to many tests—to the Medicare Part B Clinical Laboratory Fee Schedule (CLFS). That is not true of support for the VALID Act, as currently written. Sizeable segments of the diagnostics industry have taken opposing positions regarding passage of that legislation.
For these reasons, both bills will be closely watched in coming weeks as Congress works to fund the federal government while, at the same time, incorporating a variety of other bills under the omnibus bill, which is a considered a “must pass” by many senators and representatives.
Organizations representing clinical laboratories and other critical healthcare providers urged Congress to pass the Saving Access to Laboratory Services Act by January 1, 2023, to prevent deep cuts in reimbursements
Lessons about the essential role of clinical laboratories during a pandemic was the central theme in a significant publication released recently. The authors were the presidents of two of the nation’s largest healthcare companies and their goal was to connect the value clinical labs delivered during the COVID-19 pandemic to the financial threat labs face should the Protecting Access to Medicare Act of 2014 (PAMA) fee cuts coming to the Medicare Part B Clinical Laboratory Fee Schedule (CLFS) be implemented.
In an article for RealClearPolicy, healthcare executives William G. Morice II, MD, PhD (left), CEO/President, Mayo Clinic Laboratories, and Matt Sause (right), President of Roche Diagnostics North America wrote, “Without PAMA reform, labs could face drastically reduced reimbursement for commonly performed lab tests for a host of diseases.” (Photo copyrights: Mayo Clinic Laboratories/Roche Diagnostics.)
IVD Companies and Clinical Laboratories Sound Alarm
Morice and Sause warn that—without PAMA reform—the nation’s vital medical laboratories will face “drastically reduced reimbursement” for commonly performed lab tests for diseases, including diabetes, heart disease, and cancer. Reimbursement cuts may cause clinical labs serving “the most vulnerable and homebound” to reduce services or close, they noted.
“To emerge from nearly three years of a pandemic by sending the signal that austerity is our nation’s health policy when it comes to testing and diagnostics would be a significant mistake,” they wrote.
“If the proposed cuts to reimbursements for diagnostic tests are allowed to take effect, disparities caused by challenges with accessing diagnostic tests will likely grow even further,” the authors continued.
However, they added, “The Saving Access to Laboratory Services Act [SALSA] would reform PAMA to require accurate and representative data from all laboratory segments that serve Medicare beneficiaries to be collected to support a commonsense Medicare fee schedule that truly represents the market.”
How PAMA Affects Clinical Laboratory Reimbursements
PAMA, which became law in 2014, was aimed at marrying Medicare Part B Clinical Laboratory Fee Schedule (CLFS) reimbursement rates to rates medical laboratories receive from private payers, the National Independent Laboratory Association (NILA) explained in a news release.
But from the start, in its implementation of the PAMA statute, the methods used by the federal Centers for Medicare and Medicaid Services (CMS) to collect data on lab test prices paid by private payers—which were the basis for calculating new lab test prices for the Medicare program—were criticized by many laboratory professionals and other health experts.
Critics frequently pointed out that several types of clinical laboratories were excluded from reporting their private payer lab test prices. Thus, the data collected and used by CMS did not accurately represent the true range of prices paid for clinical lab tests by private health insurance plans, said lab industry groups.
CMS regulations “exclude most hospital outreach laboratories and physician office laboratories from data collection. This approach depresses median prices and has led to deep cuts to lab reimbursement. Many tests were cut up to 30% in 2018 when the new system went into effect,” the America Association for Clinical Chemistry (AACC) noted in a statement.
On September 8, just weeks after publication of the article authored by Morice and Sause, 26 organizations representing clinical laboratories and diagnostics manufacturers sent a letter to Congressional leaders. In it they described the financial impact on labs due to the current law’s omission of some outreach and physician office lab testing, and they urged the passage of the SALSA legislation.
“The significant under-sampling led to nearly $4 billion in cuts to those labs providing the most commonly ordered test services for Medicare beneficiaries,” the organizations wrote in their letter. “For context, the total CLFS spend for 2020 was only $8 billion.”
Reimbursement Cuts to Lab Tests are Coming if SASLA Not Passed
“Without Congressional action, beginning on Jan. 1, 2023, laboratories will face additional cuts of as much as 15% to some of the most commonly ordered laboratory tests,” the NILA said.
“Enactment of the Saving Access to Laboratory Services Act (SALSA/H.R. 8188/S.4449) is urgently needed this year, to allow laboratories to focus on providing timely, high quality clinical laboratory services for patients, continuing to innovate, and building the infrastructure necessary to protect the public health,” NILA added.
In an editorial she wrote for Clinical Lab Products, titled, “Be a Labvocate: Help Pass SALSA Legislation,” Kristina Martin, Clinical Pathology Operations Director, Department of Pathology, University of Michigan Medicine said, “The SALSA legislation provides a permanent, pragmatic approach to evaluating the CLFS, eliminating huge swings, either positive or negative as it pertains to Medicare reimbursement. It also allows for a more comprehensive evaluation of data to be collected from a broader sampling of laboratory sectors.”
Uses statistical sampling for widely available tests performed by a “representative pool of all clinical laboratory market segments.”
Introduces annual “guardrails” aimed at creating limits for reductions as well as increases in CLFS rates.
Excludes Medicaid managed care rates since they are not true “market rates.”
Gives labs the option to exclude mailed remittances from reporting if less than 10% of claims.
Eases clinical labs’ reporting requirements by changing data collection from three years to four.
Make Your Views Known
Proponents urge Congress to act on SALSA before the end of the year. Clinical laboratory leaders and pathologists who want to express their views on SALSA, test reimbursement, and the importance of access to medical laboratory testing can do so through Stop Lab Cuts.org. The website is sponsored by the ACLA.
