Gene patents have generally not impeded biomedical research, but some problems that arise in genetic diagnostics can be attributed to exclusively licensed gene patents. Gene patents for therapeutics have often been litigated but have received surprisingly little public outcry. In stark contrast, genetic diagnostics have been highly controversial but rarely litigated: no case has gone to trial and there is little case law to guide policy. Most recently the Secretary’s Advisory Committee for Genetics Health and Society (SACGHS) released a draft report examining how patenting and licensing affect access to clinical genetic testing in the US. The SACGHS reported that patents neither greatly hindered nor facilitated patient access to genetic testing; both the harms and the benefits of patents on genetic diagnostics have been exaggerated. Problems do occur when patents are exclusively licensed to a single provider and no alternative is available. Courts have been changing the thresholds for what can be patented, and how strongly patents can be enforced. Technologies for sequencing, genotyping and gene expression profiling promise to guide clinical decisions in managing common chronic diseases and infectious diseases, and will likely be an integral part of personalized medicine. Developing such genomic tests may require mapping a complex intellectual property landscape and cutting through thickets of patented DNA sequences and related methods. Our preliminary studies have found patent claims that, if strictly enforced, might block the use of multi-gene tests or full-genome sequence data. Yet new technologies promise to reduce the costs of complete genomic sequencing to prices that are comparable to current genetic tests for a single condition. Courts, companies, and policy makers seem unlikely to allow intellectual property to obstruct such technological advance, but prudent policy will depend on careful analysis and foresight. The SACGHS report signals that the US government is paying attention, and increases the odds that policy will foster socially beneficial uses of genetic testing while preserving intellectual property incentives and mitigating the problems that arise from legal monopolies.