Preview of 2025 Lab Trend Report: Key Insights & Takeaways
Avalon’s latest webinar offered a first look at the 2025 Lab Trend Report, marking its fifth annual edition and showcasing exclusive data-driven insights into the evolving lab testing landscape. With the rapid expansion of genetic and biomarker testing and increased scrutiny on healthcare policy and pricing, this year’s report highlights both opportunity and complexity in lab benefit management.
Dr. Monane began with key facts and quotable insights. Routine testing, which comprises approximately 90% of all lab tests, remains essential in screening for disease, monitoring drug therapy, and identifying safety concerns. Despite its “routine” label, these tests are anything but ordinary. Approximately 14 billion routine lab tests are conducted annually in the U.S., making lab testing the most utilized medical benefit.
He also noted that 70% of all medical decisions are influenced by lab test results, and 50% of office visits include a lab order. Meanwhile, the number of new genetic tests being marketed has exploded – rising from 10 per month in 2020 to 10 per day today. However, this increase comes with concerns around test quality, cost, and both over- and underutilization.
Routine Lab Testing Insights
- Routine lab overall PMPY spend increased 2% from 2023. COVID testing saw a significant decline (down 27%), while general lab testing spend rose 4%. Avalon’s evidence-based rules and utilization management programs have kept trend growth to 1% over five years – well below the industry average of 2–5%.
- Significant pricing differences continue, with hospital outpatient tests costing up to 5.7 times more than independent lab tests.
Growth in Genetic Testing
- Rising Costs: Genetic testing now represents 30% of lab spending but accounts for only 10% of utilization. From 2020-2024, genetic testing spend rose 66%, driven by more complex and expensive tests.
- Challenges for Health Plans: Health plans face difficulties in managing genetic test utilization and costs due to limited CPT codes available for billing.
Emerging Trends in Biomarker Testing
- The report explores the growing impact of blood biomarkers in early detection, diagnosis, and treatment monitoring for cancer, Alzheimer’s, and rare diseases.
- Multi-cancer early detection (MCED) and polygenic risk scores (PRS) are emerging as key tools in personalized medicine.
- These tests may reduce radiology spend but add complexity to lab benefit strategy.
Federal Policy and Regulatory Updates
- Medicare Advantage is under pressure, with new fraud investigations, upcoding crackdowns, and scrutiny of risk adjustment practices.
- Prior Authorization reforms are accelerating, with electronic PA rules taking effect in 2026–2027.
- Lab M&A activity continues to reshape access and pricing, while FDA regulation of lab-developed tests remains in legal limbo.
- The administration’s Make America Healthy Again initiative and AI-focused reforms signal sweeping changes in healthcare strategy, tech adoption, and chronic disease management.
Conclusion
Avalon’s 2025 Lab Trend Report will officially launch in June, offering an in-depth analysis of lab testing trends and innovations that are reshaping healthcare delivery. Attendees are encouraged to explore additional webinars and resources for further insights.
For a deeper understanding, be sure to access Avalon’s upcoming reports and tools, which seek to ensure the right test reaches the right patient at the right time.