The foundations of healthy living haven’t changed much over the decades: Eat well, exercise, get enough sleep. But consumers are increasingly supplementing these basics with voluntary lab testing, wearable devices, imaging and digital health tools to monitor their well-being and identify potential risks earlier.
In the U.S., preventable illnesses such as diabetes and heart disease cost about $1.4 trillion annually, including the economic cost of lost productivity, according to Morgan Stanley Research estimates based on data from the Centers for Disease Control and Prevention. That figure could rise to $4.6 trillion by 2050. Wider adoption of preventative diagnostics, however, could reduce those costs by as much as $800 billion.
For investors, the growing focus on preventative care has implications across sectors, including managed healthcare, fitness, food retail and restaurants. As consumers increasingly prioritize health and wellness—similar to the adoption trends seen with GLP-1 medications—companies aligned with wellness themes, such as gyms and some casual dining chains, may be better positioned to benefit.
“While health and fitness monitoring technologies are not new, we view the increasing integration of diagnostic results and personal biological data into health tracking as a compelling growth vector,” says Erin Wright, Morgan Stanley Research’s Healthcare Services Analyst.
Diagnostics Gain Momentum
The direct-to-consumer (DTC) diagnostics market has expanded significantly over the past two decades. Beginning in the early 2000s, some U.S. states allowed consumers to order laboratory tests without a physician referral. Since then, regulatory flexibility has increased at both the federal and state levels, while the COVID-19 pandemic accelerated consumer adoption of at-home testing and telehealth.
“The DTC market continues to mature, supported by demand for convenience, the shift toward e-commerce, adoption of telehealth and growing consumer interest in wellness and longevity,” Wright says.
Consumers can now access a range of tests, including general wellness panels, cholesterol and glucose testing, vitamin and hormone assessments, fertility screening, allergy testing and STD/STI panels, and all without a physician order. Testing options range from at-home collection kits to in-person visits, with prices ranging from $50 to $300.
Artificial intelligence is also becoming increasingly integrated into the sector. Some platforms now allow consumers to ask questions about their results and receive personalized explanations instantly, while also analyzing years of lab data to identify patterns and potential health risks.
As a result, the sector is growing rapidly: the DTC market has more than doubled since 2021 to roughly $4 billion. Some industry participants project annual growth of up to 20% in the coming years.
A Morgan Stanley AlphaWise survey conducted in January 2026 found that 34% of U.S. consumers have completed at least one voluntary wellness lab test within the past three years. Adoption was particularly strong among younger and higher-income consumers. The survey also suggested that consumers who use one type of test are often interested in repeating tests or exploring additional categories, which supports continued market growth.
Wearables Become More Personalized
Consumer health and fitness wearables trace back to the 1960s, when athletes started using pedometers and heart-rate chest straps. But the modern consumer market began to take shape in the late 2000s and has since become deeply integrated into daily consumer routines.
Today smartwatches, fitness trackers and wellness apps are widely used to monitor movement, sleep, nutrition and recovery, while increasingly offering personalized recommendations to improve health outcomes. According to the International Data Corporation, global wearable shipments have expanded at an average annual rate of 4% since 2020, accelerating to 7.9% in 2025.
In January, the U.S. Food and Drug Administration determined that wearable devices and associated software designed to support general wellness would not require formal approval or clearance as long as they don’t make medical or clinical claims.
“This new guidance establishes fewer regulatory hurdles to bring new products to market,” Wright says.
At the Consumer Electronics Show in Las Vegas earlier this year, manufacturers showcased a notable shift in wearable technology: from passive data collection, such as tracking steps and sleep, toward on-device AI capable of delivering actionable recommendations on health, activity and behavior. Real-time coaching and personalized insights are becoming increasingly common across devices.
The AlphaWise survey showed that 63% of respondents either currently use a wearable device or are interested in purchasing one. Smartwatches and wrist-based fitness trackers remain the most widely adopted category, used by 35% of respondents.
As with voluntary lab testing, wearable adoption is strongest among younger and higher-income consumers. Importantly, many users reported modifying their behavior based on device-generated insights: 34% said they regularly change behaviors, while another 52% said they sometimes do.
Implications Across Sectors
Greater adoption of preventative health tools could initially increase healthcare utilization as consumers seek follow-up care related to wearable data or lab test results.
“But over time, earlier detection could support lower-cost care and better chronic disease management,” Wright says. “Providers and consumers would then be rewarded for better outcomes and lower total costs, rather than simply higher service utilization.”
The effects could extend well beyond healthcare.
