Independent Doctors’ Offices are Disappearing, and that Could Cost You

Have you noticed it’s harder to find a truly independent doctor’s office these days? You’re not imagining it. A new report from the Government Accountability Office (GAO) shows hospital systems and private equity firms are buying more physician practices.

The numbers tell the story:

• In 2012, fewer than 30% of doctors were tied to hospital systems. By last year, that number had jumped to 47%.
• Private equity ownership is also rising: About 6.5% of physicians now work in practices owned by investment firms, up from 4.5% just a year earlier.

What does this mean for patients?

Studies show consolidation often leads to higher prices without clear improvements in quality. For example, Medicare spending rose by 5% for certain elective surgeries when care shifted from doctors’ offices to hospital outpatient settings. Some physicians report being pressured to see more patients in shorter visits, which can lead to more referrals, more tests and more bills. As independent practices disappear, patients may have less freedom to choose where and from whom they get care.

For physicians, running an independent practice has become increasingly difficult. Rising costs, administrative burdens and looming retirements make selling to a larger system or investor group an attractive option.

Hospitals say owning practices helps them coordinate care and move toward value-based payment models. But the GAO warns the trend could also reduce competition and drive up spending for patients and taxpayers alike.

What about you? Have you noticed changes in how your doctor’s office operates? Shorter visits, more referrals or higher bills? Let us know at Voices for Affordable Health.