PAMA 2027: When More Cytology Work Brings Less Payment
Article by : Chat GPT
CMS’s preliminary laboratory pricing data for 2027 offer an unexpected lesson in cervical cytology reimbursement. Adding manual review to an automated Pap screening service could result in lower payment. Two conventional manual-screening codes, distinguished principally by reporting terminology, have dramatically different private-payor medians. Meanwhile, an unusual statutory payment floor prevents several low medians from becoming Medicare fees.
The findings illustrate why laboratory prices deserve examination both individually and in relation to neighboring codes.
Automated screening: the price relationship reverses!
CPT 88174 describes automated screening of a cervical or vaginal specimen prepared using an automated thin-layer method. 88175 adds manual rescreening or review. Both operate under physician supervision.
The current Medicare rates follow an intuitive relationship: the service incorporating additional manual work receives slightly more payment. The preliminary 2027 medians reverse that relationship.
| Code | Service, abbreviated | 2026 Medicare rate | Preliminary 2027 median | Change from 2026 |
|---|---|---|---|---|
| 88174 | Automated screening | $25.37 | $27.43 | +8.1% |
| 88175 | Automated screening plus manual rescreening or review | $26.61 | $24.86 | −6.6% |
The additional manual review currently receives a $1.24 premium. Under the new medians, the more extensive service would receive $2.57 less.
This establishes a payment inversion, rather than demonstrating that either service becomes unprofitable. The data do not measure laboratory costs or margins. Nevertheless, the prospect of receiving less payment for the service with additional manual work is striking. And 88175 is more commonly used than 88174.
These figures come from CMS’s preliminary weighted-median workbook, released September 21, 2026. They are preliminary medians, rather than final Medicare payment determinations. However, (1) both exceed the current Pap payment minimum of about $18, and (2) the decrease for 88175 is below the PAMA 15% annual reduction limit. So if CMS retains the medians, the reversal appears likely to carry into payment.
The two medians represent very different populations
The reporting data reveal a substantial imbalance.
| Private-payor data before additional QC | 88174 | 88175 |
|---|---|---|
| Reporting entities, measured by TIN | 19 | 480 |
| Reporting laboratory NPIs | 20 | 730 |
| Reported test volume | 20,956 | 3,711,248 |
The reported volume for 88175 is approximately 177 times greater. These are private-payor tests submitted for PAMA pricing. They are not Medicare claim counts, Medicare expenditures, or estimates of all Pap testing nationwide.
The difference does not establish that either median is wrong. It does show that the two prices arise from substantially different reporting populations. Laboratories, payer contracts, negotiated discounts, and volume distributions could differ between those populations. The summary tables cannot establish which factors produced the reversal.
PAMA calculates a volume-weighted median independently for each code. That process can produce a valid median for each submitted distribution without preserving the expected price relationship between related services. A private-payor median also does not establish the resources required to perform the service.
CMS Quality Control does not resolve the inversion
CMS published medians calculated before and after additional "quality-control exclusions." These are meant to remove duplicate reports from the same TIN/NPI and erase bizarrely high values (100X price). The change in PAMA median is usually 0 or a few pennies. Neither median changes: 88174 remains $27.43, and 88175 remains $24.86.
For 88175, the reporting-TIN count falls from 480 to 479 after QC, but its median again stays the same. The reversal therefore survives the additional data cleaning.
A related screening code, G0145, illustrates how small the QC effect can be. Its median changes from $22.84 to $22.79, a five-cent difference downward. Compared with its 2026 Medicare rate of $26.49, the adjusted median is $3.70 lower, or approximately 14%.
Manual screening introduces further surprises!
The manual-screening codes broaden the story beyond a single automated pair.
| Code | Service, abbreviated | 2026 Medicare rate | Preliminary 2027 median | Change from 2026 |
|---|---|---|---|---|
| 88142 | Liquid-based preparation, manual screening | $20.26 | $20.26 | 0% |
| 88143 | Liquid-based preparation, manual screening and rescreening | $23.04 | $30.00 | +30.2% |
| 88150 | Conventional smear, manual screening | $18.54 | $29.55 | +59.4% |
| 88164 | Conventional smear, manual screening, Bethesda reporting | $18.54 | $10.72 | −42.2% |
These percentages compare preliminary medians with current Medicare rates. They are not necessarily the payment changes Medicare will implement. Note that $10.72 is below the $18.54 legal floor so $18.54 would be used. (See below)
Holding the liquid-based preparation method constant provides another revealing comparison. Manual screening and rescreening, 88143, currently receives less than automated screening with manual review, 88175: $23.04 versus $26.61. Their preliminary medians reverse that relationship to $30.00 versus $24.86.
The reporting populations differ here as well. The 88143 median rests on 2,880 reported tests from 15 TINs, compared with 3.7 million tests from 480 TINs for 88175.
Bethesda reporting: a large price drop for comparable screening work
The conventional-smear comparison is particularly curious. 88150 and 88164 currently receive the same Medicare payment—$18.54—yet their new PAMA medians differ by $18.83.
Both describe manual screening. The distinguishing feature is principally the reporting system. Bethesda standardizes terminology and specimen-adequacy reporting; it does not substitute a fundamentally cheaper screening technology. Separate Bethesda reporting codes are longstanding: AMA’s discussion of the 1999 CPT changes identifies the introduction of codes 88164–88167.
On the unadjusted medians alone (see below!), Bethesda reporting would have been associated with approximately 64% less payment than the neighboring manual-screening code.
That comparison comes with an important population qualification. The $29.55 median for 88150 rests on just 96 reported private-payor tests from nine TINs. The $10.72 median for 88164 rests on 942 tests from 39 TINs.
QC changes neither median.
The statutory minimum limits the disparity—but does not eliminate it
Pap smear laboratory tests have an unusual protection under Social Security Act §1833(h)(7). Congress established a $14.60 national minimum payment in 2000, with annual adjustments. The provision expressly applies notwithstanding §1834A, the PAMA pricing statute. Consequently, the minimum survives private-payor-based pricing.
The 2026 minimum is $18.54, following a 1.9% increase. CMS’s annual payment instructions explicitly include all the screening codes discussed above. The protection spans conventional and liquid-based preparations, manual and automated screening, and Bethesda reporting. Payment remains limited by the actual billed charge.
For 88174 and 88175, the floor appears unlikely to change the outcome because both medians exceed it comfortably. But for 88164, the statutory flow is decisive: the $10.72 median cannot simply become the Medicare fee. Since the code already pays at the floor, its sharply lower median need not produce an actual payment reduction.
Other codes illustrate the same protection. 88148, automated screening with manual rescreening of conventional smears, has a preliminary median of $5.28. P3000, screening Pap smears by a technician under physician supervision, has a median of $7.94. Both currently pay $18.54 and appear on CMS’s minimum-payment list.
The floor prevents the most extreme Bethesda outcome, but leaves a substantial disparity. Using the current minimum as a reference, $18.54 is approximately 37% below $29.55. The eventual difference would depend on the updated 2027 minimum and final pricing decisions. Comparable manual screening services could therefore acquire markedly different payments largely associated with the reporting distinction, even after statutory protection is applied.
What's Next?
CMS expects to publish final 2027 rates in November. The preliminary cytology results deserve awareness across the code family: additional manual review can receive less payment, closely related reporting variants can diverge sharply, and small reporting populations can generate large apparent increases. The statutory floor protects against some reductions, while leaving the unexpected relationships between other prices intact.
Source workbook for the numerical comparisons:
