From sprawling hospital systems to the growing influence of private equity, the physician landscape is shifting rapidly.
Here are the top five players driving change — and controversy — in physician consolidation.
1. Health systems and employment models
Large, integrated hospital systems remain a dominant force in physician consolidation, and not always to the benefit of patients or physicians, according to many clinicians.
Between 2013 and 2022, the number of hospital-employed physicians rose by 33%, from approximately 157,000 to over 205,000. In contrast, private practice employment grew by only 17% over the same period, according to a May 13 report in the Journal of the Society of Laparoscopic and Robotic Surgeons.
Other data suggests even more dramatic shifts. A joint report by the Physician Advocacy Institute and Avalere Health, a London-based healthcare policy and market research firm, found that 77% of physicians shifted from independent to employed models over the last decade.
Some physicians are deeply critical of this trend. Daniel Decker, MD, a urologist in Mountain House, Ark., told Becker’s that hospital employment can be “short-sighted” and “counterproductive.”
“Hospital employment often leads to a loss of autonomy for physicians, who may find themselves more focused on meeting the administrative demands of the hospital rather than prioritizing patient care,” he said. “Hospitals —despite many with ‘nonprofit’ designation — prioritize financial gain. This shift can create a disconnect between physicians and their patients, undermining the patient-physician relationship.”
Maria Teresa, MD, an OB-GYN in Chicago, added that hospital systems’ scale and negotiating leverage often crowd out smaller providers.
“Their extensive networks can disrupt smaller providers who cannot compete on price,” she said. “Additionally, their size and reach give them significant negotiating power with insurers and suppliers, influencing pricing and contract terms in ways that smaller entities cannot. Through mergers and acquisitions, they expand their reach and consolidate market share, increasing competition and pressuring smaller providers to assimilate or collaborate.”
2. Private equity
Private equity firms have emerged as aggressive consolidators, rapidly acquiring physician groups and outpatient facilities. Their goal is often short-term profitability, a concern for many in the medical field.
In 2024, 6.5% of physicians reported working in private equity-owned practices, up from about 4.5% in both 2020 and 2022, according to the American Medical Association.
“I believe the most disruptive force in physician consolidation today is the rise of private equity,” Bethwel Raore, MD, neurosurgeon at Duluth, Ga.-based Apex Spine and Neurosurgery, told Becker’s. “Their aggressive acquisition strategies and emphasis on short-term profitability are fundamentally reshaping the healthcare landscape — often prioritizing financial performance over long-term clinical value.”
Physician sentiment backs this concern. A MedPage Today survey found that 60% of physicians view PE investment negatively. Similarly, a Becker’s LinkedIn poll revealed that half of the 778 respondents believe private equity ownership is having a “mostly negative” impact on hospitals.
“Private equity continues to purchase groups and invest in numerous domains for care delivery. I remain deeply concerned, as current GDP spend in the U.S. on healthcare is approaching 20%,” Matt Mazurek, MD, assistant clinical professor of anesthesiology at St. Raphael’s Campus of Yale New Haven (Conn.) Hospital, told Becker’s last year. “Private equity investors expect return on investment. With this trend, it is easy to imagine GDP on healthcare to grow to 25% to 30%. These dollars are not necessarily going to translate to better care and quality or access.”
3. Optum
According to some physicians, no single entity is transforming physician employment more than Optum, a subsidiary of UnitedHealthcare.
“The pressure financially in the corporate medical arena often far outweighs the benefit and priority being the patient in the relationship,” Christina Menor, MD, president of California Society of Anesthesiologists, told Becker’s. “Optum has blasted through this with its overarching United Healthcare umbrella and is probably the most disruptive in physician consolidation at this time.”
Optum closed 2023 with 90,000 affiliated physicians, making it the largest physician employer in the U.S. Its rapid growth has sparked industrywide concerns about consolidation and monopolistic dynamics.
4. The macroeconomic environment
Not all disruption stems from corporations. Some experts point to broader economic trends as a major driver of change.
“Specifically, high interest rates and the rising cost of capital have significantly cooled private equity activity, particularly in specialties like ophthalmology,” said Mark Sczepanski, MD, ophthalmologist in Grand Forks, N.D. “The economics of leveraged buyouts have become less attractive, and many deals that might have made sense two years ago are no longer viable.”
This macroeconomic cooling has changed the pace and scale of acquisitions, forcing PE firms to recalibrate their strategies. According to VMG Health’s 2025 healthcare M&A report, firms are recalibrating their approach to scalable platform practices that can command premium valuations. Additionally, as reimbursement risks increase, PE interest is shifting toward less volatile sectors such as dental care and medical spas.
5. Fear of lost autonomy
A less visible but equally powerful force behind physician consolidation is the fear of lost autonomy, Joseph Lamplot, MD, orthopedic surgeon at Endeavor Health Orthopaedic & Spine Institute, told Becker’s.
“There are several modes of consolidation, and ultimately nearly all of them result in a loss of physician autonomy to varying extents,” she said. “As such, the desire for autonomy conflicts with physician consolidation.”
Dr. Lamplot predicts a rise in hybrid models that emphasize shared governance, mitigate financial risk, and offer better work-life balance.
Surveys support this trend. Around 61% of employed physicians said they have moderate or no autonomy to make referrals outside of their practice or ownership system, and 47% said they adjust patients’ treatment options to reduce costs based on practice policies or incentives, according to a survey from NORC at the University of Chicago.
Physician dissatisfaction is also rising. In Medscape’s “Medicine Beats Managing: Medscape Employed Physicians Report 2023,” 56% said reduced autonomy was the aspect they liked least about their job, up from 48% the previous year.Many leaders feel the loss of autonomy is the biggest threat to physicians. Cary Passik, MD, chief of cardiothoracic surgery at Suffern, N.Y.-based Good Samaritan Hospital, told Becker’s the erosion of autonomy is also affecting patient-physician relationships because “the administrative burdens of being a physician have become so onerous.”
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