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For the First Time, Most Practice Physicians Aren’t Owners

CHICAGO – Last year was a turning point for physician ownership of medical practices. For the first time since tracking began, fewer than half of all office physicians had an ownership stake in their practice, points out a new American Medical Association (AMA) study.

The recently updated study on medical practice arrangements points out that 2016 was the first time physician practice owners dropped below half among the nation’s doctors providing direct patient care.

For the report, AMA researchers used data from the organization’s Physician Practice Benchmark Surveys to determine how physician practice arrangements changed from 2012 to 2016. The Benchmark Surveys include physicians who provide at least 20 hours of patient care per week, are not employed by the federal government, and practice in one of the 50 states or the District of Columbia.

Results indicate that the share of patient care physicians with ownership stakes in a medical practice dropped 6%, from 53.2% in 2012 to 47.1% in 2016. At the same time, physicians who were employed by practices grew 5% from 41.8% to 47.1%. The remainder classified themselves as independent contractors.

The trend toward employed positions was especially powerful among younger physicians, with 65.1% of those under age 40 falling into that category. While the share of employed physicians age 40 and older also grew, it was less pronounced than among their younger colleagues.

“Patients benefit when physicians practice in settings they find professionally and personally rewarding, and the AMA strongly supports a physician’s right to practice in the setting of their choice,” pointed out AMA President Andrew W. Gurman, MD.

Medical specialty also was a factor in the ratio of physician owners vs. employees, according to the policy research perspective review. For example, 59.3% of clinicians in the surgical subspecialties were owners; radiology also had a majority of owners at 56.3%.

On the other hand, only 27.9% of emergency medicine physicians worked in their own practice, and 24.8% of the remainder were independent contractors.

The highest share of employed physicians was in pediatrics, at 58.3%, according to the study.

In 2012, 60.1% of doctors worked in medical practices that were entirely physician-owned. That dropped to 55.8% by 2016, with most of the movement occurring between 2012 and 2014, the report notes.

Indicative of a slowing of that trend, the percentage of physicians who worked directly for a hospital, or in practices with at least some hospital ownership — 32.8% — didn’t differ between 2014 and 2016.