By Christopher M. Waley, Daniel R. Arnold, Nate Gross, and Anupam B. Jena | Published December 8, 2021 in Health Affairs | Link to Full Article
Physician practices are increasingly being acquired by hospitals and health systems. Despite evidence that this type of vertical integration is profitable for hospitals, the association between these acquisitions and the incomes of physicians in the acquired practices is unknown. We combined national survey data on physician practice ownership with data on physician income to examine whether hospital or health system ownership of physician practices was associated with differences in physician income during 2014–18. During the study period, hospital and health system ownership of physician practices increased by 89.2 percent, from 24.1 percent to 45.6 percent of all physicians in our sample. Among physician practices overall, vertical integration with hospitals or health systems was associated with, on average, 0.8 percent lower income compared with independent physicians after multivariable adjustment. In analyses by physician specialty, vertical integration of physician practices with hospitals or health systems was associated with lower income for nonsurgical specialists, no difference in income for primary care physicians, and slightly higher income for surgical specialists. Although vertical integration of physician practices is a rapidly growing trend, physicians might not directly benefit financially.