Consumer-driven preventive diagnostics are reshaping healthcare and consumer industries
AI summary card
Consumer-driven preventive diagnostics are reshaping healthcare and consumer industries
Morgan Stanley believes that the growing adoption of DTC lab testing, wearable devices, and health tracking could save the U.S. healthcare system approximately $200 billion to $800 billion by 2050E, while benefiting clinical laboratories, health platforms, wearable devices, and wellness-related consumer scenarios.
- The U.S. bears a heavy healthcare spending burden related to preventable diseases, with the report estimating that approximately $1.4 trillion of spending in 2024 was related to preventable diseases.
- Consumer-driven diagnostics testing has become an approximately $4 billion U.S. market opportunity, more than doubling versus 2021, and clinical laboratories such as DGX and LH have scale and partnership advantages.
- AlphaWise survey data show that about 32%-34% of respondents have undergone voluntary lab testing over the past three years, and about 41% currently use wearable health or fitness monitoring devices.
- DGX's consumer testing revenue reached approximately $250 million in 2025, with about $100 million from the direct questhealth.com channel and about $150 million from partner channels.
- Beneficiaries include AAPL, DGX, GRAL, GRMN, HIMS, LH, LTH, and PLNT; some restaurant, food retail, and consumer companies may be affected by shifts in health-oriented preferences.
Report interpretation
Overview
This report discusses how consumer-driven preventive diagnostics and health tracking are changing the U.S. healthcare system and multiple consumer industries. The core backdrop is rising healthcare spending pressure from chronic and preventable diseases, alongside increasing consumer participation in self-pay testing, telemedicine, wearable devices, and health management applications. The report argues that as DTC lab testing, screening, monitoring, and personal biomarker interpretation services become more widespread, consumers will take a more proactive role in managing their health, which is expected to drive earlier intervention and reduce healthcare costs over the long term.
Core views
The report's core views are: first, the broader adoption of preventive testing, screening, and monitoring could significantly reduce long-term healthcare costs, with approximately $200 billion to $800 billion of U.S. healthcare spending related to preventable diseases in 2050E potentially avoidable. Second, consumer-driven diagnostics testing is expanding rapidly, already forming an approximately $4 billion U.S. market, with further room to grow through wearable devices, imaging, DTC channels, and laboratory partnerships. Third, nationwide clinical laboratories such as DGX and LH can become key beneficiaries by leveraging infrastructure, service networks, and high-throughput testing capabilities, with DGX showing more notable progress across partners and consumer platforms. Fourth, health and wellness consumption trends may spill over into consumer, fitness, food retail, restaurant, managed care, and wearable device ecosystems, although financial benefits may be released slowly, and short-term cost pressure may come before long-term utilization improvement.
Analysis framework
The report uses a thematic research and cross-industry mapping approach, combining U.S. healthcare costs, preventable disease spending, consumer surveys, DTC testing market evolution, corporate partnership cases, and stock impact lists for analysis. Data sources include Morgan Stanley Research estimates, AlphaWise consumer surveys, company disclosures, public information, and views from relevant industry teams.
Methodology notes
Treats DTC testing, wearable health tracking, telemedicine, and consumer wellness behavior as components of the same preventive healthcare trend.
This framework is used to assess how proactive consumer testing and health management affect healthcare costs, clinical laboratory revenue, wearable device usage, consumer product preferences, and long-term managed care utilization.
Uses consumer surveys to measure voluntary lab testing, wearable device usage, and changes in health behavior.
The survey shows that about 32%-34% of respondents completed voluntary lab testing in the past three years, and about 41% currently use wearable health or fitness monitoring devices, providing a basis for assessing consumer adoption rates.
Estimates the total U.S. healthcare spending that preventive diagnostics and care could avoid over the long term.
The report estimates that by 2050E, expanded preventive testing, screening, and monitoring could generate approximately $200 billion to $800 billion in total U.S. healthcare spending savings.
Asset mapping & comparison
Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).
- DGXExpected beneficiary; core platform for consumer testing and laboratory partnerships
- Strengths
- Nationwide laboratory scale, the questhealth.com DTC platform, partnerships with Function Health, Everlywell, WHOOP, Oura, HIMS, and others, and approximately $250 million in consumer testing revenue in 2025.
- Weaknesses
- The consumer business still accounts for a small share of overall earnings, and long-term contribution depends on growth rate, margin, and repeat customer sustainability.
- Comparison
- Compared with LH, DGX provides fuller disclosure and has made more active progress with partners, and has already been positioned as the laboratory engine of the wellness industry.
- Risks
- Cooling enthusiasm for DTC testing, regulatory changes, insufficient consumer repurchase, intensified competition, or partner traffic falling short of expectations.
- LHPotential beneficiary; clinical laboratory and women's health application entry point
- Strengths
- Nationwide laboratory infrastructure, Labcorp OnDemand, and Ovia Health's access points in women's and family health.
- Weaknesses
- Consumer testing has not yet reached the critical mass management considers necessary, disclosures are limited, and progress is relatively cautious.
- Comparison
- Has testing capabilities similar to DGX, but is currently less clear than DGX in terms of partnerships and revenue disclosure.
- Risks
- If consumer testing growth proves unsustainable or strategic priority is insufficient, it may miss incremental testing volume.
- AAPL / GRMN / WHOOP / OuraBeneficiaries of the wearable health tracking ecosystem
- Strengths
- Devices can continuously collect data such as heart rate, sleep, recovery, stress, and activity, forming a closed loop with laboratory biomarkers.
- Weaknesses
- Hardware adoption, accuracy of data interpretation, and long-term user stickiness remain key factors.
- Comparison
- Apple Watch is the most popular smartwatch or wrist-based fitness tracking brand in the survey; WHOOP and Oura are more focused on health performance, recovery, and continuous wear scenarios.
- Risks
- Commoditization of health functions, regulatory scrutiny, privacy concerns, or consumer doubts about the effectiveness of recommendations.
- HIMSExpected beneficiary; telemedicine platform expanding into diagnostics and preventive care
- Strengths
- Labs by Hims & Hers offers self-pay, physician-reviewed testing plans, and has partnership or investment links with DGX and GRAIL.
- Weaknesses
- Lab testing, sampling devices, and integration of diagnostic data are still in the expansion stage, and commercialization scale needs to be validated.
- Comparison
- Compared with a standalone testing platform, HIMS can combine test results with prescriptions, lifestyle advice, and platform cross-selling.
- Risks
- User conversion, testing frequency, regulatory compliance, and the quality of medical advice may affect growth.
- LTH / PLNT / CMG / CAVA / WMT / KR / ACIHealth and wellness consumer exposure assets that may benefit
- Strengths
- Health-oriented products, fitness services, food retail, or exposure to younger and wealthier customer groups may benefit from rising consumer health awareness.
- Weaknesses
- The benefit chain is indirect and difficult to quickly convert into quantifiable financial contribution.
- Comparison
- The report compares this trend to the spillover impact of GLP-1 on consumer behavior, emphasizing that the degree of benefit varies by company depending on health-related products and customer mix.
- Risks
- Weakening enthusiasm for health consumption, rising price sensitivity, traffic shifts, or consumer behavior changes falling short of expectations.
- UNH / HUM / ELV / CILong-term potential beneficiaries in managed care
- Strengths
- If preventive testing drives earlier intervention, it may reduce healthcare utilization and outcome volatility over the long term.
- Weaknesses
- In the short term, increased testing and screening may first bring cost pressure, and benefit recognition may be slow.
- Comparison
- Compared with direct testing and wearable device companies, managed care benefits are more long-term and systemic.
- Risks
- Short-term increases in medical costs, changes in reimbursement policy, differences in member mix, and preventive measures proving less effective than expected.
Key data
- U.S. spending related to preventable diseasesApproximately $1.4 trillionThe report estimates U.S. healthcare spending related to preventable diseases in 2024.
- Potential healthcare spending savings in 2050EApproximately $200 billion to $800 billionDerived from the potential impact of preventive testing, screening, and monitoring on total spending related to preventable diseases.
- U.S. consumer-driven diagnostics testing marketApproximately $4 billionMore than double the level of approximately $2 billion in 2021.
- Voluntary lab testing adoption rateApproximately 32%-34%In the AlphaWise survey, the share of respondents who completed voluntary lab testing in the past three years.
- Wearable health or fitness device usage rateApproximately 41%In the AlphaWise survey, the share of respondents currently using wearable health or fitness monitoring devices.
- DGX consumer testing revenueApproximately $250 millionConsumer testing revenue in 2025; approximately $100 million from direct-to-consumer questhealth.com and approximately $150 million from partner channels.
- Potential EPS contribution from DGX consumer business2030E approximately $0.62-$1.87Depends on margin and CAGR scenarios; under 20% CAGR and 20% margin, contributes approximately $0.83 EPS.
- Hims & Hers Labs pricing$349 annual planIncludes two blood tests per year, covering 130+ biomarkers and 10 health areas.
Impact & implications
From an investment perspective, the report believes that consumer health testing and preventive healthcare trends have spillover effects across clinical laboratories, wearable devices, health platforms, fitness, food retail, restaurants, and managed care. DGX is viewed as an important beneficiary of the consumer testing trend due to partnerships with Function Health, Everlywell, WHOOP, Oura, and HIMS; LH also has scale advantages but has disclosed less and is advancing more cautiously. Among consumer companies, those with stronger health orientation and greater exposure to younger or higher-income customer groups are more likely to benefit. Long-term gains for managed care come from earlier intervention and lower utilization, though in the short term it may first bear cost pressure from increased testing, screening, and engagement.
Risks
- Consumer-driven testing may be only a short-term fad; if health and longevity themes cool, demand and repurchase rates may decline.
- The DTC testing market is highly fragmented, with major differences across platforms in pricing, biomarkers, turnaround time, sampling methods, and care options, and competition may compress margins.
- Healthcare cost savings from preventive testing are mainly a long-term scenario; in the short term, testing, screening, and follow-up treatment spending may increase first.
- Regulation, privacy, data security, and liability for medical advice may limit the application of DTC testing, AI interpretation, and wearable health data.
- Partner-driven growth for laboratories such as DGX and LH depends on platform traffic, user repurchase, and expansion of the testing menu; if partnerships underperform, incremental EPS contribution may be lower than scenario estimates.
- For some consumer companies, the connection to this theme is relatively indirect, and changes in health behavior may not necessarily translate into certain revenue or profit growth.
What to watch
- Whether DGX consumer testing revenue, partner channel revenue, and repeat customer mix continue to improve.
- Whether LH begins separately disclosing its consumer testing business and accelerates Labcorp OnDemand, Ovia Health, or external partnerships.
- User growth, testing frequency, and business models of platforms such as Function Health, Everlywell, WHOOP, Oura, and HIMS in their laboratory partnerships.
- Conversion rates, pricing, and regulatory progress of diagnostic services such as HIMS Labs and GRAIL Galleri on consumer platforms.
- Adoption rates of voluntary lab testing, wearable device usage, and the share of users changing behavior based on health data in AlphaWise or other surveys.
- Whether managed care companies reflect the benefits of preventive testing in long-term utilization, member engagement, and value-based care programs.
- Whether food, restaurant, fitness, and retail companies show differences in category mix, traffic, or same-store sales due to shifts in health-oriented consumption.