New Health Affairs Report on Physician Consolidation Shows Rapid Movement from Small to Large Group Practices

A recent report in Health Affairs titled “Physician Consolidation: Rapid Movement from Small to Large Group Practices, 2013–15” identified an accelerating trend of physicians moving from small to large group practices, with more pronounced effects among primary care physicians. The authors used information from Medicare’s Physician Compare dataset to examine changes in the makeup of physician practices between June 2013 and December 2015. According to their findings, the proportion of physicians in small groups (9 or fewer) dropped from 40.1 percent of all physicians in 2013 to 35.3 percent in 2015. Groups with more than 100 physicians increased from 29.6 percent to 35.1 percent over that same time period.

The report also found that the greatest changes in consolidation occurred among the smallest and largest group practices. The proportion of physicians employed in practices with one or two physicians dropped from 22.5 percent of all physicians in 2013 to 15.5 percent in 2015. Likewise, the proportion of physicians employed in a practice of 500 or more increased from 12.6 percent in 2013 to 15.4 percent by December 2015.

Explanations for why this is happening include the significant technical and financial challenges associated with managing a medical practice as well as the ability for larger practices to attract younger physicians with more administrative support. The proliferation of population- based contracting agreements might also play a role in facilitating the movement towards larger practices.

Notably absent from the report is a discussion of whether this trend towards group practice consolidation will lead to better healthcare outcomes and lower costs. The authors caution that the evidence is mixed and further research is required.

To read the full Health Affairs article, CLICK HERE.


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