For the last 20 years, the consolidation of physician practices has been a growing phenomenon in healthcare.
In 2024, just 42% of physicians worked in private practice, down from 60% in 2012. Nearly half (47%) were employed by or affiliated with hospitals, according to a Government Accountability Office report. Private equity roll-ups, health system acquisition sprees and the rising cost of operations have all played a role in driving physicians away from independent practice and towards employed settings.
Two physicians recently joined Becker’s to discuss their perspectives on how market consolidation is impacting physicians’ sense of autonomy — and how leaders can address it.
Editor’s note: Responses have been lightly edited for clarity and length.
Question: As consolidation continues, what’s the biggest trade-off physicians feel between employment stability and clinical or financial autonomy — and how is your leadership addressing it?
Michael Gomez, MD. Executive Physician Consultant (San Antonio): The biggest or core trade-off is “stability” versus “sovereignty.”
In exchange for a stable income and not needing to manage and maintain a complex medical organization, many physicians, especially younger physicians who have only worked in an employed training-like structure, are comfortable and tolerate an employment model.
More experienced physicians may have had experience with practice “sovereignty” and are either excited by continuing it or disaffected by its constant pressures and challenges. Therefore, the real organizational question to address this trade-off is shifting from, “How do organizations engage in or maintain physician ownership?” to “How do we preserve adequate physician control, legitimacy, and economic alignment (or agency) so doctors do not feel like replaceable employees?” Some organizations do this by emphasizing physician-led employment whereby clinical medicine is kept at the bedside by preserving selected physician prerogatives inside larger corporate structures, while the business of medicine or all the ‘other stuff’ is managed intensely and corporately. Purposeful physician alignment across both employed and independent channels also signals to physicians a respect for the separation between clinical and corporate practice.
Justin Trivax, MD. Cardiologist at Millennium Cardiology (Farmington Hills, Mich.): Protecting each physician’s identity in the group is strategic. When physicians feel like stakeholders, they stay engaged in building referral networks, driving volume and maintaining subspecialty excellence. That engagement is what creates real leverage within a large organization. Without it, productivity becomes transactional and one’s influence can erode quickly. At the same time, autonomy only holds if it is actively used. Referral control, procedural volume, and expertise give the group negotiating power, but only if physicians are involved in decisions that shape those areas. The leadership move is to connect identity to influence, making it clear that clinical ownership and engagement are what preserve operational independence within the system.
Q: As health systems and private equity continue to acquire more practices, how is your organization thinking about maintaining physician ownership?
Dr. Michael Gomez: Most health systems, [private equity]-backed groups, and large corporate practices that employ physicians are not really thinking in terms of preserving broad physician ownership as a dominant or even a partial ownership model. The general direction I perceive is more toward preserving physician leadership, governance or economic participation without ceding full ownership control given the huge investment sourced backing for large complex structures. Publicly, the tools being used are things like physician-led service lines, clinically integrated networks, co-management arrangements, compensation tied to quality/productivity/access, medical directorships and practice/[management services organizations] structures are designed to comply with corporate practice of medicine rules while keeping doctors in key leadership roles and only partially in an ownership state. State policymakers and the [American Medical Association] are pushing back on arrangements that dilute independent clinical judgment, especially through stricter oversight of management influence and stronger protection of physician decision-making.
Maintaining this balance keeps an interest in flowing investment funds into these large organizations with the pressure applied by physicians, physician organizations and policymakers concerned about medicine being over-run by corporate interests looking for investment returns. Given the size of spending versus GDP, the effect of healthcare on the economy, and the plain high complexity of medicine, power dynamics will continue to shift away from physician ownership control. One million U.S. physicians cannot meet patient demand for care and still have time to manage the complexities of ownership in today’s state of affairs in medicine.
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