Consolidation of US Physician Practices Continues to Surge

The trend toward consolidation of physician practices in recent decades is accelerating, according to results of a new study published online September 7 in Health Affairs. "The proportion of physicians in groups of nine or fewer dropped from 40.1 percent in 2013 to 35.3 percent in 2015, while the proportion of those in groups of one hundred or more increased from 29.6 percent to 35.1 percent during the same time period," David B. Muhlestein, PhD, JD, and Nathan J. Smith, PhD, from Leavitt Partners, Salt Lake City, Utah, write. "Primary care physicians have made this change at a much faster pace than specialists have."

In the last few decades, the proportion of physicians in larger groups has grown. Several factors have contributed to this move from smaller groups, the authors note. Larger practices offer more administrative support, which can help with adoption and meaningful use of electronic health records as a driver of Medicare incentive payments; they also facilitate physicians' participation in population-based healthcare incentive programs, and in general, younger physicians, who represent an increasing proportion of the physician workforce, tend to prefer working in larger practices.

In their study, Dr Muhlestein and Dr Smith therefore analyzed data from the Centers for Medicare & Medicaid Services' (CMS) Physician Compare data set to examine the rate of US physician consolidation from smaller to larger group practices from June 2013 through December 2015. They found that the makeup of physician groups changed significantly during the study period. Large numbers of physicians moved from smaller to larger groups, with the greatest changes occurring in the smallest and largest group sizes...