The Rise and Potential of Physician Unions
The consolidation of hospital systems and physician practices under a single corporate umbrella has resulted in major structural changes to the practice of medicine. In 2012, 60% of practices in the US were physician-owned, 23.4% of practices had some hospital ownership, and only 5.6% of physicians were direct hospital employees. After a surge in acquisitions of physician practices over the decade, and in response to the COVID-19 pandemic, the fraction of physicians employed by hospitals or health systems reached 52.1% and 21.8% by other corporate entities in 2022, for a total of an estimated 74% of practicing physicians. Many physicians now are employed by consolidated corporate health care systems that span many different communities and increasingly are spread across multiple states.
This rapid transformation has largely followed an aggressive strategy, put forward by hospital and corporate leadership, that seeks scale and exploits market power. However, it is also a strategy that is increasingly at odds with the interests of the physicians working in these organizations. The strategic differences are revealed in a variety of important policy differences, spanning from payer contracting strategies, compensation incentive structures, and service line prioritization. These differences suggest the potential for growing challenges for US medicine.