According to new data by Avalere for the Physicians Advocacy Institute (PAI), 70% of U.S. physicians are now employed by hospital systems and corporate entities.
Avalere, with the IQVIA OneKey database that contains physician and practice locations, examined the period between January 1, 2019, and January 1, 2021. It found that, during this time period, hospital systems and other corporate entities acquired 20,900 additional physician practices.
In addition, the research revealed that the COVID-19 pandemic accelerated the trend of hospitals and corporate entities acquiring physician practices and employing physicians.
Aside from the acquisition of physician practices, 48,000 additional physicians left independent practice for employment by hospital systems or other corporate entities.
“COVID-19 exacerbated financial vulnerabilities of physician practices and forced them to make difficult decisions,” said Kelly Kenney, chief executive officer of PAI. “The practice acquisition trend has potentially serious implications for competition and health care costs, which have been shown to increase with this type of marketplace consolidation.”
Avalere researchers discovered:
- Hospitals, health systems and corporate entities now own nearly half of the nation’s medical practices.
- A 32% increase in physician practice acquisitions and employment among corporate entities, such as private equity firms and health insurers.
- Hospital ownership of practices grew between 6% and 11% and corporate ownership grew between 44% and 59%.
“Regardless of the practice setting, physicians must retain autonomy to make clinical decisions, free from interference by corporate entities motivated primarily by profits,” said Kenney.
