Rates of Hospital Acquisition of Physician Practices Have Accelerated Dramatically in Rural Areas

Summary

Avalere recently partnered with the Physicians Advocacy Institute to examine trends in physician employment and practice ownership by hospitals and health systems from 2012 to 2015.

Please note: This is an archived post. Some of the information and data discussed in this article may be out of date. It is preserved here for historical reference but should not be used as the basis for business decisions. Please see our main Insights section for more recent posts.

As follow-up, this analysis specifically explores how the overall trends of greater physician employment and practice ownership vary between urban and rural/micropolitan areas (“rural”).

Historically, physicians working in urban areas have been more likely to be employed by hospitals (27.6% in July 2012) than their counterparts in rural areas (22.9% in July 2012). Similar trends exist for practices that are owned by hospitals. As of July 2012, 15.0% of practices in urban areas were owned by hospitals, compared to 11.8% in rural areas.

Within the past three years, hospital employment and hospital ownership of physician practices has increased in both urban and rural areas. However, the difference between the two categories has narrowed over time. Growth in the number of rural practices owned by hospitals has significantly outpaced those in the urban setting over the past three years—102.6% growth among rural practices compared to 77.8% growth for urban practices.

For more information on rural and urban trends in physician employment and practice ownership, please see our data supplement.