BURLINGTON – Labcorp is warning that preliminary Medicare laboratory rates for 2027 could reduce payment for affected tests by as much as 15% a year, although the company reaffirmed its long-term outlook while evaluating the financial impact.
In a Sept. 22 filing with the Securities and Exchange Commission, the Burlington-based company said the Centers for Medicare & Medicaid Services released preliminary Clinical Laboratory Fee Schedule rates Sept. 21 for calendar years 2027 through 2029. The rates remain preliminary, and CMS is accepting comments through Oct. 21.
CMS uses private-payor data reported under the Protecting Access to Medicare Act to set Medicare payment amounts for many clinical diagnostic laboratory tests. The agency says no phase-in reduction applies during 2026. From Jan. 1, 2027, through 2029, payment for an affected test may not be reduced by more than 15% in a year compared with the preceding year’s rate.
The 15% figure is a statutory annual ceiling, not an across-the-board cut for every test. The CMS reporting and rate-setting page includes the preliminary 2027 data and weighted medians that are open for comment.
Labcorp said the reported data do not fully represent the broader commercial laboratory market and argued that the preliminary rates would impose steep annual payment reductions that could threaten patient access. The company also said it supports the proposed RESULTS Act as a response to the rate-setting issue. Those positions reflect Labcorp’s assessment of the policy, not a final CMS determination.
Labcorp did not quantify the expected effect on revenue or earnings. It said it is still evaluating the preliminary rates and expects to provide more information when it issues 2027 guidance in February.
The company reaffirmed its 2026-through-2029 outlook, including revenue growth of 5% to 8% annually, adjusted operating-margin expansion of 75 to 150 basis points by the end of 2029 and adjusted earnings-per-share growth of 8.5% to 11.5% annually.
The immediate business consequence is prospective reimbursement risk to Labcorp’s core U.S. diagnostics operations. The disclosure does not announce a final payment schedule, a quantified earnings reduction, job cuts or a change to the company’s current outlook.
Featured image: U.S. Air Force Staff Sgt. Brandon Rickard examines a urine culture specimen at Hurlburt Field, Florida. This representative clinical-laboratory image does not depict a Labcorp facility. Senior Airman Alysa Calvarese/U.S. Air Force via DVIDS.