New Technologies and greater insurance coverage will strengthen demand.
Los Angeles, CA (PRWEB) February 26, 2012
Diagnostic and medical laboratories provide healthcare practitioners with information about the presence, severity and cause of patients' physical ailments. While the Diagnostic and Medical Laboratories industry has long been an essential ingredient in healthcare, according to IBISWorld industry analyst Sophia Snyder, the aging population and the ongoing move toward preventative care have further boosted revenue in recent years. Indeed, during the five years to 2012, revenue is expected to grow an average of 2% annually to $48 billion. Growth has started to accelerate after it slowed in 2008 due to the economic recession, and revenue is expected to rise 2.7% in 2012.
According to Snyder, “While the aging population has bolstered demand, it has also threatened the industry. Laboratories are witnessing a shortage of skilled labor as baby boomers, who make up a significant portion of the industry workforce, retire and fewer individuals pursue healthcare professions. This trend is evident in the marginal 0.1% annual increase in employment to 251,382 people over the five years to 2012. The shortage of skilled labor has boosted salaries as operators try to entice people into the field and retain current employees. The escalating use of automation and standardization in laboratories has helped keep overall wage costs down.”
The market for analytic and diagnostic services will continue to grow at a rapid pace in the five years to 2017, says Snyder. Scientific advances are yielding new and improved service capabilities, and the aging US population is requiring more and better laboratory testing and diagnostic imaging services. Additionally, the healthcare reform legislation of 2010 will begin taking effect during the next five years, which will be a net benefit to the industry, mainly due to increased healthcare insurance coverage. Greater access to insurance will boost demand since out-of-pocket costs for laboratory services will shrink. The trade-off for the industry will be Medicare reimbursement cuts.
This industry has a low level of concentration, with the top four players accounting for about 30% of industry revenue; however, the top two players – Quest Diagnostics and Laboratory Corp of America – control many of the markets in which they operate. There has been some consolidation in this industry in recent years, particularly in the laboratory segment, but the industry remains highly fragmented.
For more information visit IBISWorld’s Diagnostic and Medical Laboratories in the US industry page
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IBISWorld industry Report Key Topics
This industry provides analytic services to identify or determine the nature and cause of a disease or injury through evaluation of a patient’s history, examination and data. These services are provided to healthcare providers or to patients on referral from health practitioners.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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