Is The End Of Private Practice Nigh?

Nearly three in four doctors currently work in hospitals, healthcare systems, or businesses, according to new data from Avalere. This is a 7% increase from a year ago and an almost 20% increase from 2019.

In other words, independent doctors are becoming an endangered species. The commercialization of medicine is eroding competition in the healthcare market. And that leads to higher prices for patients and lower wages for providers.

The pandemic has accelerated a long-standing trend of greater integration in medicine. The large healthcare system received more than 36,000 physician visits between January 1, 2019 and January 1, 2022, the year before the pandemic began. This means that the proportion of company-owned practice has increased by 38%.

Faced with the financial burden and burnout of a pandemic, some independent doctors felt they had no choice but to close their practice and work for a larger medical company. According to Avalere, about 83,000 doctors have been employees of hospitals and other businesses since the pandemic began.

Aside from the factors associated with pandemics, it’s not hard to understand why corporate health care attracts private doctors.

As an employee of a larger system, doctors do not have to deal with the headaches of billing and paperwork associated with personal practice. They are also guaranteed a fixed salary and working hours. Unlike an independent doctor, their income and time often depend on the amount of care he or she provides and the overheads incurred in the practice.

However, as large healthcare systems continue to gain market share, they accumulate more leverage to demand higher prices from patients and insurers. And they are not shy to use it. When hospitals get medical attention, the price of health care services goes up by more than 14%. Health Economics Journal..

These higher costs do not translate into higher salaries for doctors.recently Health problems Studies show that doctors’ salaries actually decrease after being treated in a hospital. Doctors in some disciplines are experiencing salary cuts on average close to $ 10,000 after the hospital takes over.

There is no evidence that higher prices lead to better care for patients. In fact, hospital-owned clinics report higher preventable admission and readmission rates for patients than smaller, independent clinics. Annual report of home medicine..

This is because the integration of the healthcare market limits competition and choice. What are the results, according to the National Bureau of Economic Research working paper? “If the hospital’s medical care is owned by the hospital, patients are more likely to choose a high-cost, low-quality hospital.”

This is because doctors employed by large conglomerates are often prohibited from referencing patients to healthcare providers outside the healthcare system. Therefore, if an expert with specific health expertise is not part of the referral provider’s network, you may not be able to meet that expert.

It is no wonder that patients are less satisfied when they are treated in a hospital in a highly concentrated market.

The healthcare system protects many of these high prices from their integration. Studies show that hospitals surge in revenue by nearly 20% after seeing a doctor.

Patients and healthcare providers should lament the growing commercialization of healthcare. Often this is a low quality, high priced healthcare recipe.