HIDA 2018 Lab Market Report
Market-At-A-Glance
The laboratory testing market was valued at $79 billion in 2017. The largest market segments were hospital labs (59.1%), independent labs (39.1%), and physician office labs (3.7%).
PAMA Rate Reductions Take Effect
Beginning January 2018, the new clinical laboratory fee schedule (CLFS) was implemented. This cut reimbursement for 75% of tests listed, adding additional financial pressure to laboratories nationwide.
Genetic Testing Market More Than Doubles In Size
The U.S. genetic testing market was valued at $5 billion in 2016, up 150% from 2012. This market is rapidly growing due to both increased demand, and advances in technology. From 2003-2018, a notable subsegment, genomic testing, saw advances in technology reduce the price of genome sequencing from $2.7 billion to just $100. As of 2017, there were 69,100 genetic testing products available. These tests covered 4,500 testable disorders, and nearly 19,000 testable genes.
Reference Lab Giants Plan For Acquisition
Nearly half of the $27 billion reference lab market is dominated by two players, LabCorp and Quest. These two companies performed over 300 million tests in 2017. As of 2018, there were 6,584 independent U.S. lab facilities.
Physician Office Labs Vulnerable To Rate Cuts
Physician office labs (POLs) at just $2.9 billion, represent a fraction of the overall laboratory market but total nearly half of U.S. laboratory facilities. This segment of laboratories received 47% of their revenues from Medicare in 2016. As reimbursement cuts arrive in 2018, this segment is particularly susceptible to changes.
- Executive Summary
- Laboratory Market Overview
- Hospital Lab Market Valued At $47 Billion
- Hospital Lab Test Volumes Increase Five Consecutive Quarters
- POL Market Grows $300 Million In 2017
- POLs Make Up Nearly Half Of U.S. Laboratories
- Drug Testing Spurs Growth In Number Of POLs
- Quest Diagnostics, LabCorp Are Nearly Half Of Reference Lab Market By Revenue
- LabCorp Increases Per Test Revenues
- LabCorp Revenues 13.5% Higher Than Quest In 2017
- Number Of Post-Acute Labs Up 12.5% From 2011 - 2018
- CMS Relies Heavily On Reference Lab Data To Set Rates
- Number Of CLFS Codes Up 18.4% From 2010
- 75% Of Tests On CLFS To Receive Medicare Reimbursement Cuts Under PAMA
- 20 Largest Payment Increases Under PAMA
- 20 Largest Payment Decreases Under PAMA
- Labs Work To Support Value Based Care Models
- Medicare Spending On Lab Testing Down $200M From 2015–2016
- Medicare Spending By Test
- Drug, Molecular Pathology Testing Have Largest Medicare Spending Decreases
- Payment, Coding May Differ Between Test Categories
- POLs Most Vulnerable To Changes In Medicare Reimbursement
- Lab Tech Investment Benefits Hospitals
- Lab Work Most Helpful Aspect Of EHR
- Companion Diagnostics Compliment Pharmaceutical Therapy
- Precision Medicine Market Projected To Exceed $2 Billion By 2022
- Molecular Diagnostics Offer Early Detection
- Syndromic Panel Testing: Multiple Diagnoses In One Test
- Syndromic Panels May Lower Testing Costs
- Majority Of Genetic Tests Are Single-Gene
- Rapid Growth In Number Of Genetic Tests
- Genetic Testing Could Reduce Treatment Costs
- Genomic Testing Costs Rapidly Decline
- Top 25 Tests Total 63% Of Medicare Lab Spend
- Lab Supplies Purchased Through Distribution
- Price Transparency Has No Impact On Clinician Test Ordering
- GHX Market Breakdown Of Clinical Laboratory-Related Product Categories Sold Through Distribution
- GHX Lists Clinical Laboratory Products Sold Through Distribution
- Definitions
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