Craig-Hallum analyst Kevin Ellich believes the large independent labs, Quest Diagnostics (DGX) and LabCorp (LH), are better prepared to absorb the potential impact from PAMA - Protecting Access to Medicare Act - if it is implemented, as slated, on January 1, 2018 than smaller labs. The analyst does not believe PAMA is fully reflected in the valuations of the stocks, and thinks Quest Diagnostics and LabCorp could benefit from increased testing volume as potential rate cuts attributable to PAMA could push smaller labs out of business while pressuring hospital lab margins such that hospitals might choose to rationalize their lab businesses.