This bill changes how Medicare sets prices for lab tests so people with Medicare can keep access to needed testing. It aims to use real‑world prices and clearer rules to make payments fair and stable.

For tests that are widely used (run by more than 100 providers), Medicare will pull prices from a large, nationwide claims database run by an independent nonprofit, starting with data collected for 2028 reporting. The database must be high‑quality and privacy‑safe. If Medicare can’t get this data or the database has no prices for a test, it will keep last year’s payment and add inflation until good data is available. For less‑common tests with no data, Medicare will match the price to a similar test or use a standard “gap‑fill” method, and then carry that price forward until new data arrives. Medicare must also publish explanations of how each test’s price was set.

Key points

• Who is affected: people with Medicare who get lab tests, and the clinical labs that run them.
• What changes:
  • Data collection is reset to begin in 2027, with detailed rules issued by the end of 2026.
  • Prices are based on “final payment rates” (the last paid amount) and exclude denied, appealed, mistaken, or recouped payments.
  • If there’s no database contract or no data for widely used tests, payments default to last year’s amount plus the Consumer Price Index (CPI) until data is available.
  • For tests that aren’t widely available, if there’s no data, Medicare uses a comparable test or the gap‑fill process, and then keeps that price until new data appears.
  • Annual cuts to lab fees are capped at 5% starting in 2029.
  • Medicaid managed care prices are excluded from the dataset only before 2028; after that, they may be included.
• When:
  • New data periods start January 1, 2027; the database‑based approach for widely used tests applies to reporting periods beginning on or after January 1, 2028; the 5% cap begins in 2029.