The American Medical Association (AMA) last year noted that most patient care physicians now work outside of physician-owned medical practices. This marked the first time physicians in private practices dropped below 50%. The AMA study cited contributing factors to the shift, including practice closures and job changes.
Marco Fernandez, MD, founding member of the Association for Independent Medicine (AIM), says healthcare corporations merging and private equity firms acquiring independent practices have caused the steep drop in independent physicians. “A lot of patients don’t realize what’s going on. When these entities come in, they reduce physician autonomy. Sometimes physicians are let go, and patients are being seen by non-physicians to increase throughput or meet quotas.”
In 2021, $151 billion in private equity capital flooded healthcare globally — more than double the prior year, according to a Bain and Company report. Private equity-owned practices tend to focus on achieving investment returns on short timelines, typically within three to seven years. Healthcare researchers, physicians, and journalists warn that this incentive to maximize revenue could negatively impact patient care and healthcare costs, though regulators so far have not scrutinized the practice.
Physician-led medical groups, such as Northbrook-based PediaTrust, Duly Health, and associations like AIM, are examples of doctors banding together to maintain control over their practices and stay competitive.