AMA: Physicians Continue to Move Away from Private Practices

On May 29, the American Medical Association (AMA) published the findings of its latest research on physician practice characteristics in 2024. “Physicians reported that inadequate payment rates, costly resources, and burdensome regulatory and administrative requirements are longstanding and important drivers of this change,” according to a press release by the AMA.

In 2024, 42.2 percent of physicians were in private practice, 18 percentage points lower than in 2012, according to the analysis. Furthermore, physicians are less likely to work in small practices. Rather, they tend to work in larger practices, which are more likely to be multi-specialty and often owned by a hospital or a private equity group.

Among independent physicians who sold their practices in the last 10 years to a hospital, private equity firm, or insurer, the most cited reason was inadequate payment rates.

“The share of doctors working in practices wholly owned by physicians is unraveling under compounding pressures,” said AMA President Bruce A. Scott, M.D., in a statement. “The cumulative impact of burdensome regulations, rising financial strain, and relentless cuts in payment poses a dire threat to the sustainability of private practices. After adjusting for inflation in practice costs, Medicare physician payment has fallen 33 percent over the past quarter century, which has severely destabilized private practices and jeopardized patients’ access to care. Payment updates are necessary for physicians to continue to practice independently.”