Payer Policy

CY 2027 Clinical Laboratory Fee Schedule Preliminary Rates

Average Cuts of About 16% and an October 21 Comment Deadline

Rcmaxis Billing & Policy Update  ·  Posted October 4, 2026  ·  Effective: January 01, 2027 (preliminary; final rates due November 2026)

Preliminary CY 2027 rates cut Medicare payment for 1,171 lab codes by an average of about 16%, with molecular pathology down 22% and genomic sequencing down 23%, but no test can fall more than 15% in a year through 2029.

Summary of the Rule or Edit Change

CMS released preliminary Calendar Year 2027 Clinical Laboratory Fee Schedule (CLFS) rates in September 2026. For the first time since 2018, CMS applied the market-based method set in the Protecting Access to Medicare Act (PAMA), which uses weighted median private payer rates for each test. Laboratories reported data collected between January 1 and June 30, 2025 during a reporting window from May 1 to July 31, 2026, and 6,411 laboratories submitted data.

The results are steep. Of 1,947 HCPCS codes, 1,528 (78.5%) had enough data to set a weighted median rate. Of those, 186 codes go up, 169 stay the same and 1,171 go down, with 2 more that have no comparable 2026 rate, for an average potential change of about 16% lower. By category, chemistry falls about 16%, molecular pathology 22%, genomic sequencing 23%, microbiology 19.3% and immunology 19.3%. Proprietary laboratory analyses fall about 2.4%. CMS estimates the new rates will save Medicare about $1 billion a year.

The law limits the damage. Payment for a test can't be reduced by more than 15% per year from 2027 through 2029, so a code with a larger gap is phased down over several years. The public comment period runs 30 days from the September release and closes October 21, 2026, and CMS plans to publish final rates in November.

A related reminder came in the October 1 MLN Connects newsletter. Medicare doesn't pay for a duplicate lab test unless it's medically necessary, and a second vitamin D test is the example CMS gave. When a repeat test is medically necessary, report modifier 91, the code for a repeat clinical diagnostic laboratory test.

To see why this matters, take a lab with $2 million in annual Medicare fee schedule revenue. A flat 15% cut, the most the cap allows in one year, would remove $300,000. Real exposure depends on your test mix, which is why the code-level comparison below is worth doing before October 21.

Action Required for Billing Teams

  • Compare code by code. Pull your 2026 volume by HCPCS code and apply the preliminary 2027 rates to see the dollar change, not just the percentage.
  • Flag the steepest categories. Molecular pathology and genomic sequencing codes are down more than 20%, so review those lines first.
  • Check your reported data. If your lab reported private payer rates, confirm they were counted correctly, and ask CMS to correct errors through the reconsideration process.
  • Submit comments by October 21. Send rate comments to CLFS_Annual_Public_Meeting@cms.hhs.gov with the code, the issue and the data behind it.
  • Review payer contracts tied to Medicare. If a commercial contract pays a percentage of the Medicare CLFS, your rate will move with it.
  • Use modifier 91 correctly. Report it on medically necessary repeat tests and document why the repeat was needed.
  • Model the phase-in. Build 2027, 2028 and 2029 cash flow with the 15% annual cap in mind.

Verifiable References

  1. CMS. Preliminary Calendar Year (CY) 2027 Medicare Clinical Laboratory Fee Schedule Payment Rates (fact sheet). cms.gov/newsroom/fact-sheets/preliminary-calendar-year-cy-2027-medicare-clinical-laboratory-fee-schedule-payment-rates
  2. CMS. CMS Announces New Preliminary Medicare Payment Rates for Laboratory Services (press release). cms.gov/newsroom/press-releases/cms-announces-new-preliminary-medicare-payment-rates-laboratory-services...
  3. CMS. Clinical Laboratory Fee Schedule. cms.gov/medicare/payment/fee-schedules/clinical-laboratory-fee-schedule-clfs
  4. CMS. MLN Connects Newsletter for October 1, 2026 (Laboratory Testing: Medicare Denies Duplicate Tests). cms.gov/training-education/medicare-learning-network/newsletter/mln-connects-newsletter-october-1-2026

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