Direct Pay
Patient pays New Century Labs directly for lab testing.
PatientNew Century Labs
Can California Clinics Offer Cash-Pay Labs?
California caps what a clinic may charge for an outside lab’s test at what the lab charged (B&P §655.5) — Direct Pay or a disclosed Service Fee; markup is not permitted.
New Century Labs supports all three billing workflows: Direct PayService FeeSelf-Managed Pricing
Educational overview, not legal advice · Last reviewed July 2026 · Choose a starting point here, then confirm it with counsel.
Plain-English answer
Can California clinics offer cash-pay labs? Yes, but California law caps what you can charge at the lab’s own price. No markup. Use Direct Pay or pass the lab charge through at cost, and bill your clinic’s own services separately.
Three billing workflows
Direct Pay, Service Fee, and Self-Managed Pricing
Service Fee
Clinic may charge a transparent fee for professional/admin services.
PatientNew Century Labs + Clinic fee
Self-Managed Pricing
Clinic controls patient pricing where state law and payer context allow.
PatientClinicNew Century Labs
California caps what a clinic may charge for an outside lab’s test at the lab’s own price (B&P §655.5). Start with Direct Pay, where the patient pays New Century Labs directly, and add a disclosed Service Fee for your clinic’s own work.
Recommended starting point for California clinics
Start with Direct Pay. If you rebill, pass the lab charge through at cost. Your margin comes from a Service Fee for your own work, never from the lab test.
California-specific billing considerations
California bars marking up outside lab work, and requires the lab to bill directly for lab services. Use Direct Pay, or pass the lab charge through at cost. Charge for your own services separately. For reference, see California’s statute, Cal. Bus. & Prof. Code § 655.5.
How each workflow fits in California
| Workflow | Fit for California clinics |
|---|---|
| Direct Pay | Recommended, or pass the lab charge through at cost. |
| Service Fee | Fine for the clinic’s own separate work; no profit on the lab service. |
| Self-Managed | Not permitted: California caps the charge at the lab’s own price. |
Medicare-sensitive workflows
In California, Medicare patients usually mean Direct Pay with any clinic fee separate and documented. New Century Labs’ cash-pay workflow is intended for non-covered or patient-requested testing where Medicare is not billed; covered, medically necessary services require a different billing analysis — see our Medicare guide.
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Common lab test mix
Based on frequently ordered tests across New Century Labs practices.
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Common lab test mix
How you bill patients
Patient pays New Century Labs directly
Add a transparent service fee
$
You control patient pricing
%
Estimated patient savings
For your practice
$0
saved per patient
Your patient pays $0 instead of $0 when insurance falls short.
For your practice
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How you can bill for lab work is regulated and varies by state. You're responsible for choosing a model that complies with your state's rules. This is an illustration, not legal advice; we'll help you find the right fit on the call.
Common questions
Can California clinics offer cash-pay lab testing?
Yes. The real question is which billing workflow, not whether. Most clinics start with Direct Pay: the patient pays the lab directly.
Can a California clinic charge patients more than the lab’s price?
No. California law caps your charge at what the lab charged. Bill your own services separately.
What’s the simplest way for a California clinic to start?
Direct Pay. The patient pays New Century Labs directly and there is nothing to set up. Add a separate service fee for your own work where appropriate.
Sources & review notes
Written by New Century Labs and reviewed for operational accuracy by the New Century Labs team — not reviewed as legal advice. Last reviewed July 2026; laws and payer rules may change. Confirm the right workflow for your practice with your healthcare counsel.
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Where to go next
Cash-pay lab billing
Next step
Talk through the right cash-pay lab workflow for your practice.
Pick the workflow that fits your state and your practice. We’ll help you compare Direct Pay, Service Fee, and Self-Managed Pricing, then confirm it with counsel.