Delay Is Not Reform: Why PAMA Still Puts Diagnostic Access at Risk
Diagnostic access depends on reimbursement stability, and PAMA continues to undermine both. Congress has taken an important step to delay further disruption. With the Consolidated Appropriations Act of 2026 signed into law, Medicare CLFS cuts scheduled for 2026 have been delayed, and the PAMA reporting period has been updated to reflect more current market data.
But relief is not reform, and patients and providers continue to bear the risk.
For laboratories navigating today’s reimbursement environment, the core problem with PAMA remains unchanged. Without structural fixes, the same forces that created instability, uncertainty, and access risk will continue to shape Medicare rates under the existing methodology.
Why the 2026 Relief Matters—And Why It’s Not Enough
There is no question that pausing further cuts matters. The 2026 delay in CLFS cuts helps laboratories stabilize near-term operations, preserve services, and continue investing in innovation that supports earlier detection and better patient outcomes. Updating the data collection period to reflect 2025 commercial rates is also directionally positive, particularly given the burden of relying on outdated data in prior cycles.
Yet from an operational and market-access perspective, these changes do not address the fundamental flaw in how Medicare laboratory rates are set or how pricing signals affect long-term access and investment decisions.
PAMA still relies on an incomplete view of the diagnostic marketplace.
The Data Problem at the Heart of PAMA
Laboratories do not operate in a single, uniform payment environment. Hospital outreach programs, independent laboratories, and physician office labs all experience different contracting dynamics, volumes, and reimbursement structures. When Medicare rates are derived from a partial snapshot of commercial data, the resulting prices distort the market rather than reflect it, creating reimbursement signals that fail to align with actual cost structures, utilization patterns, and access needs.
Even with newer data, CMS is unlikely to receive a truly representative set of private payor rates under the current framework, leaving large segments of the laboratory market underrepresented in rate setting. The result is continued volatility. Rates swing unpredictably, investment decisions are made under uncertainty, and pressure mounts on providers serving rural, underserved, or complex patient populations.
In practice, this instability has real consequences. It constrains laboratories’ ability to plan, invest in advanced diagnostics, and maintain broad access to testing services patients rely on every day.
Temporary Stability vs. Sustainable Access
At XiFin, we work alongside laboratories that are balancing razor-thin margins with rising operational complexity, including automation investments, compliance demands, and increasing data reporting requirements. They are investing in automation, compliance, and analytics while navigating shifting reimbursement signals that make long-term planning increasingly difficult.
Short-term stability buys time. Structural reform protects access.
Without a durable solution, laboratories remain exposed to future rate shocks that undermine financial sustainability and slow innovation, precisely when diagnostics are playing a larger role in personalized medicine, population health, and earlier disease detection.
What Durable Reform Requires
Meaningful reform starts with better data and better governance—the core principle behind the RESULTS Act.
Medicare rates should be informed by comprehensive, accurate commercial payment information that reflects the full diagnostic ecosystem, not just a subset of it. An independent, not-for-profit data infrastructure would allow rates to be set based on reality rather than approximation, improving predictability for providers and confidence in the system as a whole while mitigating future destabilizing cuts.
This approach doesn’t just benefit laboratories. It supports patients by preserving access to timely, high-quality diagnostics. It supports policymakers by grounding rate-setting decisions in transparent, representative data. And it supports innovation by giving providers the financial clarity needed to invest in next-generation testing.
A Moment to Finish the Job
Congress has acknowledged that PAMA, as currently structured, creates risk. The current delay is an opportunity, not an endpoint, and it should be used to advance comprehensive reform rather than defer it.
Using this moment to advance lasting reform would move Medicare laboratory reimbursement from a cycle of temporary fixes to a framework built for long-term stability. That shift is essential to protecting patient access, sustaining innovation, and ensuring diagnostics remain a strong foundation of the healthcare system.
A delay may pause the damage. Reform is what prevents it, and Congress has the opportunity to act now by advancing lasting PAMA reform through the RESULTS Act.
Stay informed on PAMA reform and the RESULTS Act by engaging with the policy resources and advocacy updates available through ACLA, NILA, and others, and by supporting efforts to secure sustainable Medicare reimbursement for diagnostics.