Report: The Death of the Private-Practice Physician is Overstated

by webadmin on September 18, 2013

NAJ-thumb3A frequently discussed topic within the healthcare community revolves around the increasing numbers of physicians who are seeking hospital employment. In fact, this topic is discussed so much by those of us in healthcare media you couldn’t be blamed for thinking self-employed physicians are a dinosaur of the pre-healthcare reform past.

However, when large numbers of people start discussing anything with some semblance of authority, it’s wise to raise your intellectual flags to full-mast and place your brain waves on red alert, because that foe of innovative thought and insight, conventional wisdom, is probably lurking around the corner.

According to John Commins at HealthLeaders Media, the American Medical Association has uncovered some surprising statistics in a recent report.

“To paraphrase Mark Twain, the reports of the death of private-practice medicine have been greatly exaggerated,” Ardis Dee Hoven, M.D., president of the American Medical Association, said.

The report revealed the following: “…while there has been an increase in hospital employment, more than half of physicians (53.2 percent) were self-employed in 2012, and 60 percent worked in practices wholly owned by physicians. Needed innovation in payment and delivery reform must recognize the wide range of practice types and sizes that exist today so all physicians can participate in the move to a more patient-centered system that rewards high-quality care and reduces costs.”

To be fair to conventional wisdom, in all of its groupthink glory, the AMA confirms that hospital employment is indeed trending upwards. It just hasn’t taken over.

Yet.

Commins writes, “In 2012, 29 percent of physicians worked either directly for a hospital (5.6 percent) or for a practice that was at least partially owned by a hospital (23.4 percent). The last AMA survey taken in 2007–2008 did not distinguish between direct hospital employment and employment in a hospital-owned practice, but found that 16.3 percent of physicians worked in one of the two settings.”

Also, from 2007/2008 until 2012, “the percentage of physicians who were practice owners…decreased eight percentage points,” and in the same five-year period of time, the number of solo-practice physicians declined by six percentage points to 18 percent.

Furthermore, the AMA found, interestingly enough, that “single-specialty practice was the most common practice type in 2012, accounting for 45.5 percent of physicians.”

Phil Miller, vice president of communications at Merritt Hawkins, expressed surprise over the AMA’s findings, contending that most physicians want to be employed. According to Miller, the dominance of the employment model is in the tea leaves of healthcare’s future.

“The number of solo settings that we recruit[ed] into 10 years ago was close to 20 percent. Last year it was one percent,” Miller said. “It was the same thing with partnerships. Solo practices and partnerships were the classic independent settings and now we do next to none of those anymore. Pretty much 90 percent or more of the settings we recruit into now feature employment of one kind or another.”

As healthcare executives, how many physicians have you employed in the last year? Have you noticed an uptick in sync with the reported trends of physicians seeking hospital employment? Does your service area still have a significant number of self-employed, private-practice physicians? How do you expect your care team to evolve over the next few years?

-by Pete Fernbaugh

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