Independent Practice Isn't Disappearing — But the Operational Gap It Has to Close Is Real

The headline number gets repeated a lot, usually to sell something: physicians in private practice dropped from 60.1% in 2012 to 42.2% in 2024, according to the American Medical Association's Physician Practice Benchmark Survey (American Medical Association). It's real data, and it's a real trend. It's also frequently used to argue that independent practice is a dead end — which isn't what the data actually says, and isn't a framing we think holds up.

What actually changed, according to AMA's own numbers

Over that same twelve years, hospital-owned practices grew from 23.4% to 34.5% of physicians, and direct hospital employment rose from 5.6% to 12.2%. Private equity ownership — a newer category AMA started tracking separately — grew from 4.5% in 2022 to 6.5% in 2024. Practice size shifted in step: physicians in small practices of 10 or fewer doctors fell from 61.4% to 47.4%, while those in practices of 50 or more grew from 12.2% to 18.3% (American Medical Association).

What the number doesn't say

It doesn't say independent practice stopped being viable. Even after twelve years of consistent consolidation pressure, more than 4 in 10 physicians are still in private practice, and that share varies enormously by specialty — ophthalmology sits at 70.4% and orthopedic surgery at 54%, both well above the aggregate. A trend line isn't a verdict on any individual practice's decision to stay independent, and specialty matters more to the real answer than the national average does.

The actual pressure is operational, not existential

What consolidation pressure really reflects is that running billing, credentialing, payer enrollment, and call center operations at hospital-system standards used to require hospital-system scale. A solo or small practice competing for the same reimbursement rates and the same patient expectations as a health-system-owned group, without a comparable back-office operation, is the practice that eventually feels the pressure to sell — not because independence itself failed, but because the operational gap widened faster than a small team without dedicated systems could close it on its own.

Closing that gap doesn't require giving up independence

Standardized revenue cycle systems, credentialing tracking, and reporting discipline aren't exclusive to organizations large enough to build them in-house. A 5-provider independent practice can run the same clean-claim discipline and executive-style reporting as a much larger group, scaled to its actual size and budget — whether that practice is planning to add locations or has no intention of ever being anything other than exactly the size it is today. Both are legitimate outcomes. The AMA trend describes what happens when the gap goes unaddressed; it doesn't describe what has to happen.

See how we support independent and growing practices at whatever size fits — including staying exactly this size, indefinitely.

Industry statistics cited above are drawn from the American Medical Association's Physician Practice Benchmark Survey as noted and are not medbpo360's own client data.