US Medical and Diagnostic Laboratory Services Market, By Test (Lipid Panel, Liver Panel, Renal Panel, Complete Blood Count, Electrolyte Testing, Infectious Disease Testing, Other), By Product (Instruments, Reagents, Other), By End User (Hospital Laboratory, Diagnostic Laboratory, Point-of-care Testing, Other), By Region, Competition, Forecast & Opportunities, 2020-2030F

Market Overview

The US Medical and Diagnostic Laboratory Services Market was valued at USD 75.25 Billion in 2024 and is expected to reach USD 124.76 Billion by 2030 with a CAGR of 8.75%. The U.S. Medical and Diagnostic Laboratory Services market plays a pivotal role in the nation’s healthcare delivery system, serving as a cornerstone for accurate clinical decision-making, early disease detection, and population-level health management.

This market is experiencing a fundamental transformation shifting away from traditional, high-volume, hospital-based operations toward a more integrated, technology-driven, and patient-focused model. As diagnostic testing becomes increasingly central to value-based care strategies, chronic disease monitoring, and the rise of precision medicine, the industry is well-positioned for long-term growth. This momentum is being fueled by advancements in diagnostics, increased demand for accessible testing solutions, and deeper integration with emerging care delivery frameworks across the healthcare continuum.

Key Market Drivers

Rising Burden of Chronic and Lifestyle-Related Diseases

The increasing prevalence of chronic and lifestyle-related diseases is a critical demand driver for the U.S. Medical and Diagnostic Laboratory Services market. These conditions are responsible for a dominant share of national healthcare expenditures, with total costs encompassing direct medical treatment and indirect economic losses from reduced workforce productivity surpassing USD1 trillion annually. This growing economic strain underscores the urgent need for scalable, data-driven interventions, particularly in diagnostics and early disease management. Chronic conditions require ongoing, routine diagnostics for effective disease management, risk stratification, and treatment monitoring: Patients require regular testing for blood glucose levels, HbA1c, lipid profiles, kidney function (e.g., creatinine, microalbumin), and electrolyte panels. These tests are performed multiple times per year, creating a high-frequency revenue stream for labs. Cardiovascular disease (CVD) remains the foremost cause of mortality in the United States, accounting for one in every five deaths. In 2022 alone, heart disease claimed the lives of 702,880 individuals, according to data from the CDC. Health Affairs estimates that approximately one in three U.S. adults equating to nearly 71.3 million people are currently living with one or more forms of CVD. This widespread prevalence not only highlights a critical public health concern but also signals sustained demand for diagnostic and monitoring services within the nation’s healthcare infrastructure.

Cancer patients depend on diagnostic labs for tumor markers, pathology review, genomic profiling, and post-treatment monitoring, including through liquid biopsies and molecular diagnostics. In 2025, the United States is projected to see a significant rise in cancer incidence, with the American Cancer Society forecasting approximately 2,041,910 new cancer diagnoses over the year. This equates to an average of nearly 5,600 new cases each day. The growing volume of cancer diagnoses underscores the critical role of diagnostic laboratories in early detection, disease staging, and treatment planning reinforcing the sector’s strategic importance within the broader oncology care continuum. This ongoing demand from chronic care supports sustained test volumes, enhances customer retention, and ensures predictable cash flow for service providers.

As healthcare policy shifts toward early detection and prevention to control long-term costs, diagnostics are being used not just for diagnosis, but as a frontline tool for prevention: Lipid panels, blood pressure-related bloodwork, metabolic panels, and liver/kidney function tests are now routinely ordered for individuals at risk due to age, obesity, or family history. Labs are central to identifying at-risk patients early, enabling lifestyle interventions before disease progression. This increases the volume of low-cost, high-frequency tests performed in wellness programs and primary care settings. Insurers and employers promote regular screenings as part of corporate wellness initiatives. Diagnostic labs benefit directly from this trend, particularly in B2B contracts and population health programs. This preventive orientation further widens the diagnostic touchpoint with patients beyond acute clinical need.

Modern chronic care management programs rely heavily on diagnostics for informed, data-driven interventions: Diagnostic data is used to segment patient populations, set clinical baselines, and measure health outcomes under bundled payment or capitation models. Labs play a strategic role in achieving quality metrics tied to reimbursement. For chronic patients, especially the elderly and immobile, diagnostic services are being extended into home settings via mobile phlebotomy or self-collection kits, often integrated with RPM platforms. Labs are increasingly partnering with primary care providers, specialists, and health systems to co-manage chronic disease cohorts, providing not just test results, but also interpretive insights and trend analysis. These integrations position labs as clinical enablers, not just transactional service providers, increasing their relevance and embeddedness in care pathways.

Advancement in Diagnostic Technologies

Advancements in diagnostic technologies are fundamentally reshaping the landscape of the U.S. Medical and Diagnostic Laboratory Services industry. These innovations are enhancing the precision, efficiency, and scalability of diagnostic processes, thereby enabling laboratories to meet rising clinical demand, streamline operations, and expanding service offerings. As healthcare shifts toward value-based, data-driven care models, diagnostic labs that embrace technological evolution are increasingly positioned as strategic enablers in the care delivery ecosystem. The rapid adoption of molecular and genetic testing is opening new frontiers in disease detection and personalized medicine: Technologies such as RT-PCR, next-generation sequencing (NGS), and liquid biopsies allow for early and highly accurate identification of diseases particularly in oncology, infectious diseases, and rare genetic disorders. Genomic profiling is now widely used to determine the most effective, targeted therapy for individual cancer patients, making diagnostics an integral part of treatment planning and clinical decision-making. Post-COVID, there has been a sustained demand for molecular testing for respiratory viruses, sexually transmitted infections, and antimicrobial resistance profiling. These high-value tests command premium reimbursement rates and generate significant revenue opportunities for advanced labs, moving diagnostics beyond traditional, volume-based services.

Technological automation is transforming the internal workflows of diagnostic laboratories, reducing costs and improving throughput: High-throughput instruments can now process thousands of samples per hour with minimal human intervention. This increases capacity, minimizes human error, and reduces turnaround times. AI algorithms are being used to assist in reading radiology images, pathology slides, and genomic datasets improving diagnostic accuracy and accelerating reporting. AI and machine learning tools are also being deployed for inventory forecasting, predictive analytics, and process optimization, leading to smarter resource allocation. This operational agility enables labs to scale efficiently while maintaining quality and compliance standards, especially in high-demand scenarios.

The decentralization of diagnostic services, enabled by portable and connected testing devices, is a major market growth lever: Portable devices for COVID-19, glucose, cholesterol, infectious diseases, and more allow patients to receive near-instant results outside of traditional lab settings, including pharmacies, clinics, and workplaces. Companies are offering diagnostic services where consumers can collect samples (e.g., saliva, blood via finger prick, urine) at home and send them to labs for testing enhancing accessibility for underserved and rural populations. Smart diagnostic tools integrated with mobile apps and cloud platforms allow both patients and providers to track real-time health data, contributing to ongoing care management. This shift toward patient-centric, digitally enabled diagnostics expands the lab’s market reach and improves customer engagement, particularly among tech-savvy consumers and employers.

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Key Market Challenges

Reimbursement Pressure and Regulatory Constraints

One of the most significant barriers to growth is the ongoing pressure from federal reimbursement policies and increasing regulatory oversight: The Protecting Access to Medicare Act (PAMA) has led to sharp reductions in reimbursement rates for a wide range of clinical laboratory tests. These rate cuts disproportionately affect independent labs and smaller regional providers that rely heavily on Medicare payments for revenue. Diagnostic laboratories must navigate a highly complex web of Current Procedural Terminology (CPT) codes, medical necessity documentation, and insurance claim validations. Errors or delays in billing processes can result in reimbursement denials and operational inefficiencies. Labs are subject to strict quality and operational standards under frameworks such as CLIA (Clinical Laboratory Improvement Amendments), CAP (College of American Pathologists), and HIPAA. Compliance requires significant investment in administrative overhead, IT systems, and ongoing audits particularly challenging for mid-sized and independent operators.

As a result, many labs are experiencing margin compression and are forced to consolidate or partner with larger diagnostic networks to stay financially viable.

Workforce Shortages and Talent Constraints

The U.S. diagnostic services sector is facing an acute shortage of qualified professionals, which directly affects laboratory throughput and service quality: A large portion of the current laboratory workforce is nearing retirement, and there is a lag in the entry of new, adequately trained lab professionals to fill the gap. There are not enough accredited programs or seats to train clinical lab technologists, pathologists, and molecular diagnostics specialists at the pace required to meet rising demand. Post-pandemic fatigue, increased workloads, and administrative burdens have led to elevated burnout levels and attrition in labs nationwide. This is especially critical in high-complexity labs where specialized skills are required.

These talent shortages can delay test processing times, increase error rates, and limit the ability of labs to scale up operations directly impacting customer satisfaction and growth scalability.

Key Market Trends

Shift Toward Preventive and Personalized Medicine

One of the most impactful trends driving future growth is the U.S. healthcare system’s transition from reactive treatment to preventive, predictive, and personalized care. Medical laboratories are at the center of this shift: There is growing emphasis on early detection of diseases such as cancer, cardiovascular conditions, and diabetes. This has led to increased demand for diagnostic panels, genetic screenings, and biomarker testing especially for at-risk populations. Companion diagnostics are gaining traction in oncology, immunology, and rare diseases. Laboratories are increasingly providing precision diagnostic services that help physicians tailor treatments based on individual genetic and molecular profiles. As chronic disease prevalence continues to rise, particularly among aging demographics, labs are seeing expanded roles in ongoing patient monitoring and treatment optimization.

This trend is strengthening the strategic relevance of diagnostic services within the broader care continuum and fueling demand for higher test volumes and specialized capabilities.

Adoption of Advanced Technologies and Automation

Technological innovation is accelerating across all layers of the laboratory value chain, improving efficiency, accuracy, and scalability: There is a sharp rise in the use of next-generation sequencing (NGS), PCR, CRISPR-based diagnostics, and liquid biopsy techniques. These tools enable early and more precise detection of genetic mutations, infectious agents, and rare disorders. AI-driven diagnostic algorithms, image analysis tools, and workflow optimization software are improving diagnostic speed and accuracy while reducing human error. This is especially relevant in pathology, radiology, and microbiology labs.

High-throughput analyzers, automated sample handling, and integrated data systems are streamlining operations and reducing turnaround times, allowing laboratories to handle larger volumes with lower operational costs. The integration of these technologies not only enhances lab performance but also opens new revenue streams through specialized, high-value test offerings.

Segmental Insights

Test Insights

Based on the category of Test, the Infectious Disease Testing segment emerged as the fastest growing segment in the US Medical and Diagnostic Laboratory Services Market in 2024. Infectious Disease Testing holds the largest share due to its wide clinical applicability and the critical role it plays in early detection, outbreak surveillance, and disease management. The COVID-19 pandemic permanently altered the landscape of diagnostic testing in the U.S., normalizing large-scale infectious disease screening and dramatically expanding testing infrastructure. Even post-COVID, demand remains elevated for respiratory panels, influenza, RSV, and novel pathogen detection.

The growing public health threat posed by drug-resistant bacteria and emerging viruses is fueling ongoing investments in next-generation infectious disease diagnostics particularly PCR, antigen, and nucleic acid amplification tests (NAATs). Increased awareness, public health funding, and clinical guidelines promoting routine STI and hepatitis screening especially among high-risk populations have contributed significantly to test volume. Hospitals, long-term care facilities, and urgent care centers increasingly rely on comprehensive infectious disease testing panels to streamline clinical decision-making and manage patient flow. These factors are expected to drive the growth of this segment.

Product Insights

Based on the category of Product, the Reagent segment emerged as the dominating segment in the US Medical and Diagnostic Laboratory Services Market in 2024. Every diagnostic test whether for infectious diseases, cancer markers, or chronic disease panels requires specific reagents. This results in high turnover and continuous restocking, creating a predictable, high-volume revenue stream for suppliers and service providers. The rising use of molecular diagnostics, immunoassays, and next-generation sequencing (NGS) technologies has increased demand for high-performance reagents, particularly nucleic acid amplification reagents, monoclonal antibodies, and fluorescent probes.

Reagents are often tailored to specific platforms or proprietary assays, making them indispensable and non-substitutable. This drives brand loyalty and locks in long-term customer relationships for manufacturers. In many diagnostic procedures, the reagent component constitutes a substantial proportion of the total test cost, especially in molecular or specialized testing, which further elevates their market value.

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Regional Insights

Southern Region emerged as the largest market in the US Medical and Diagnostic Laboratory Services Market in 2024, holding the largest market share in terms of value. The South is home to some of the most populous and fastest-growing states in the U.S., leading to an expanded patient base and increased demand for diagnostic services, especially for chronic disease management and preventative screening.

The region has a higher incidence of lifestyle-related conditions such as diabetes, obesity, cardiovascular diseases, cancer, necessitating routine and specialized testing. This has intensified the need for both clinical and pathology laboratories. Southern states feature extensive networks of hospitals and ambulatory care centers, many of which are increasingly outsourcing lab testing services to third-party diagnostic firms to reduce operational costs and increase efficiency. The South hosts regional hubs for leading diagnostic companies such as Quest Diagnostics and Labcorp, enabling faster service delivery, high testing volumes, and integrated digital health platforms.

Recent Developments

• In February 2025- Fresenius Medical Care, and Quest Diagnostics have entered into a definitive agreement under which Quest will acquire specific assets of Spectra Laboratories Fresenius’ U.S.-based subsidiary specializing in renal-focused laboratory diagnostics. This strategic acquisition is set to enhance Quest’s capabilities in the renal diagnostics segment while aligning with Fresenius' focus on core operational priorities.
• In January 2025, Quest Diagnostics, a prominent provider of diagnostic information services, has announced the successful completion of its previously disclosed acquisition of select assets from University Hospitals one of the United States’ premier nonprofit health systems and academic medical centers. While financial details remain confidential, the transaction significantly expands Quest’s footprint in Ohio by enhancing access to its advanced diagnostic testing portfolio, extensive network of patient service centers, and wide-ranging health plan affiliations across the state.   
• In July 2024, Danaher Corporation announced the opening of two newly certified laboratories under the Clinical Laboratory Improvement Amendments (CLIA) and the College of American Pathologists (CAP). These state-of-the-art facilities are designed to advance the development of Companion Diagnostics (CDx) and Complementary Diagnostics (CoDx), reinforcing Danaher’s commitment to accelerating precision medicine and strengthening its position in the personalized healthcare space.

Key Market Players

• Quest Diagnostics Incorporated
• Thermo Fisher Scientific Inc.
• BIOMÉRIEUX
• Siemens Medical Solutions USA, Inc.
• Laboratory Corporation of America® Holdings
• Sonic Healthcare USA
• Bio-Rad Laboratories, Inc.
• Charles River Laboratories
• Danaher Corp.

Report Scope:

In this report, the US Medical and Diagnostic Laboratory Services Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:

• US Medical and Diagnostic Laboratory Services Market, By Test:

o   Lipid Panel

o   Liver Panel

o   Renal Panel

o   Complete Blood Count

o   Electrolyte Testing

o   Infectious Disease Testing

o   Other

• US Medical and Diagnostic Laboratory Services Market, By Product:

o   Instruments

o   Reagents

o   Other

• US Medical and Diagnostic Laboratory Services Market, By End User:

o   Hospital Laboratory

o   Diagnostic Laboratory

o   Point-of-care Testing

o   Other

• US Medical and Diagnostic Laboratory Services Market, By Region:

o   North-east

o   Mid-west

o   West

o   South

Competitive Landscape

Company Profiles: Detailed analysis of the major companies present in the US Medical and Diagnostic Laboratory Services Market.

Available Customizations:

 US Medical and Diagnostic Laboratory Services market report with the given market data, TechSci Research offers customizations according to a company's specific needs. The following customization options are available for the report:

Company Information

• Detailed analysis and profiling of additional market players (up to five).