Consolidation of physician practices proceeds apace, corporatizing medicine one acquisition at a time

The days when most doctors worked in independent practice settings are fading from memory like old photoprints in a musty scrapbook.

Taking their place is an era dominated by physician employment. And the employers are not only hospitals but also a “vast array of corporate entities with various financial incentives for employing physicians.”

The quote is from the authors of a new report compiled by Avalere Health for the Physicians Advocacy Institute, also known as PAI.

The shift towards corporatization of physician practice, the PAI analysts add, has “significant implications for costs, patient care and the future practice of medicine.”

The report looks at trends in practice acquisitions as well as physician employment over the eight-year stretch from January 2018 to January 2026. 

For the research, Avalere used the IQVIA OneKey database, which includes solo and single-location small practices as well as large, multispecialty and multilocation group practices.

Seven key findings fleshed out in the report: 

1. More than 4 of every 5 physicians (82.0%) are now employed by hospitals, private equity firms, health insurers or other corporate entities, “continuing a decade-long trend away from private practice,” the authors remark. 
    
2. As of January 2026, 59.7% of physicians were employed by hospitals and 22.3% were employed by corporate entities. Further, the percentage of employed physicians grew by 5.6% from 2024 to 2026, largely due to talent-hungry hospitals.
    
3. More than 6 of every 10 physician practices (63.9%) are now owned by hospitals or other corporate entities, “driven by the marketplace race to acquire physician practices,” the authors note. 
    
4. Physician employment (80.2%) and physician practice ownership (67.8%) in rural areas mirrored national trends, “reflecting the shift in the rural healthcare market.”
    
5. More than a quarter-million physicians (253,000) became employees of hospitals or corporate entities from January 2018 to January 2026. Of these, some 48,100 physicians became employees between 2024 and 2026.
    
6. In the last two years, all regions of the country experienced continued growth in physician employment and practice acquisitions at a moderate pace similar to the overall national trend. Over the eight-year period between 2018 to 2026, non-independent physicians increased between 66.1% (Midwest) and 106.7% (South), while non-physician-owned practices increased between 86.4% (Midwest) and 140.2% (South).
    
7. The number of physicians practicing in rural areas decreased from 2018 to 2024 and started to increase again over the past year. However, the share of physicians and practices “continues to shift toward hospital and corporate employment,” the authors observe. From 2024 to 2026, they add, the percentage of employed physicians grew by 6.8% and non-physician owned medical practices grew by 9.8% in rural areas.

“Historically, a vast majority of physicians practiced in physician-owned practice settings,” the authors point out. Over the eight-year period covered by the report, they underscore, “bedrock feature of independent medical practice unraveled.”

The 52-page report is available for downloading here (PowerPoint format).