Three Out of Four Physicians Now Employed

April 28, 2022

More than 75% of physicians are now employed by hospitals, health systems, and other corporate entities, according to a recent report looking at trends in physician employment and acquisitions of medical practices between 2019 and 2021.  

The research, conducted by the Physicians Advocacy Institute and Avalere Health, shows that the pandemic accelerated the ongoing trend of physicians leaving private practice for employment, spurred by hospitals and other corporate entities acquiring medical practices, part of a wave of consolidation throughout the healthcare industry.  

Other key findings include: 

• 108,700 physicians shifted to employment since January 2019. This growth split nearly evenly between hospital employees (58,200 additional physician employees) and other corporate entities (50,500 additional physician employees). 

• Of those, 83,000 physicians (76%) became employees since the pandemic began. 

• 2021 alone saw a marked increase in employed physicians, growing by 19%, from 69.3% to 73.9% of all physicians. 

• Hospitals and corporate entities, including private equity firms and insurance companies, now own more than half (52.1%) of physician practices (hospitals own 26.4% and other corporate entities own 27.2%).  

• While hospital and health system acquisitions continued at a steady pace (9% growth), the sharpest increase (86% growth) in medical practice acquisitions over the three-year study period was by corporate entities. 

• The COVID-19 pandemic accelerated corporate ownership of physician practices and physician employment by hospital systems and other corporate entities in the last half of 2020 and throughout 2021.  

• Every region of the country saw a steady trend towards increased employment and hospital and corporate ownership of practices, but there are distinct differences among regions. 

• The Midwest continued to have the highest percentage of physicians employed by hospitals and health systems (63.5%, growing 9% over the study period). 

• The South saw the highest rate of acquisitions by corporate entities (94% increase).