Hospital Acquisitions of Physician Practices Rose 128% Since 2012

 By Jacqueline LaPointe

February 21, 2019 – Hospital acquisitions of physician practices continues to be a strong trend in the healthcare space, according to new data from Avalere Health and the Physicians Advocacy Institute (PAI).

In an emailed press release, the organizations reported that hospitals acquired approximately 8,000 physician practices between July 2016 and July 2018. That number is on top of the 5,000 hospital acquisitions of physician practices from July 2015 to July 2016.

Overall, hospital acquisitions of physician practices increased by 128 percent from 2012 to 2018, the updated analysis found. In July 2012, only 35,700 practices were considered hospital-owned, but that number jumped to 80,000 practices by the start of 2018.

While hospitals engaged in robust acquisition activity, physician employment by hospitals and health systems also dramatically increased since 2012, the analysis revealed.

Over the five-and-half-year study period, the number of physicians employed by hospitals or health systems increased by more than 70 percent, growing from 94,700 employed physicians in mid-2012 to 168,800 employed physicians by the start of 2018.

During the most recent 18-month period alone, 14,000 physicians left their private practices to work for a hospital or health system.

Additionally, researchers found that all regions experienced an uptick in hospital-owned practices at every measured time period. The increase of hospital-owned practices in the regions ranged from 91 percent to 303 percent.

“The continued trend of hospital-driven consolidation is dramatically reshaping the healthcare system,” Robert Seligson, PAI’s President and CEO of the North Carolina Medical Society, stated in the press release. “PAI will continue to advocate for fair, transparent policies and champion physician clinical autonomy, regardless of the practice setting, to ensure that physicians can continue to deliver the best possible care to their patients.”

In general, healthcare mergers and acquisitions are taking off. PricewaterhouseCoopers (PwC) recently reported that merger and acquisition activity across the entire industry increased 14.4 percent in 2018, and deals among provider organizations, including hospitals and physician groups, accounted for 28 percent of the total number of transactions.


Chris J. Stewart

Chris currently serves as President and CEO of Surgio Health. Chris has close to 20 years of healthcare management experience, with an infinity to improve healthcare delivery through the development and implementation of innovative solutions that result in improved efficiencies, reduction of unnecessary financial & clinical variation, and help achieve better patient outcomes. Previously, Chris was assistant vice president and business unit leader for HPG/HCA. He has presented at numerous healthcare forums on topics that include disruptive innovation, physician engagement, shifting reimbursement models, cost per clinical episode and the future of supply chain delivery.

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