For First Time, More Doctors Employed Than Self-Employed: AMA

Alicia Ault

May 09, 2019

For the first time, the number of employed physicians outstrips the number who are self-employed, according to a new survey by the American Medical Association (AMA).

The organization said that in 2018, 47.4% of doctors involved in patient care were employed, while 45.9% were self-employed.

"Transformational change continues in the delivery of health care and physicians are responding by reevaluating their practice arrangements," said AMA President Barbara L. McAneny, MD, in a statement. "Physicians must assess many factors and carefully determine for themselves what settings they find professionally rewarding when considering independence or employment."

The AMA's latest Benchmark Survey, which has been conducted every 2 years since 2012, includes physicians who provide at least 20 hours of patient care per week, are not employed by the federal government, and practice in one of the 50 states or the District of Columbia. About 3500 physicians participated in the survey.

Self-Employment Declining

According to the latest survey, the number of self-employed doctors has declined by 7% since 2012. But the shift to employment has not occurred as rapidly as had been anticipated, said the AMA.

For instance, previous AMA surveys indicate that the number of self-employed physicians fell by 14% between 1988 and 1994. Still, the overall pattern has been a shift away from doctors owning their practices. In 1983, 76% of doctors were self-employed, according to AMA data. That figure has declined by a third.

The number of physicians who work for themselves or other physician-owned practices — eg, private practices — is also declining. In 2018, a slight majority — 54% — of doctors worked in physician-owned practices, either as owners, employees, or contractors. That's down from 2012, when 60% of doctors worked in a practice they or one of their colleagues owned.

The AMA survey found that younger physicians and women physicians are less likely to be owners than older male colleagues. About a quarter of physicians younger than 40 owned a practice, compared to 54% of doctors aged 55 or older. Only 34% of women own their practices, compared to 52% of men.

Some specialists are more likely to own their practices. Surgical subspecialists make up the largest number of self-employed physicians, with almost 65% reporting ownership. More than half of ob-gyns, internal medicine subspecialists, and radiologists were owners. Only 26% of emergency medicine physicians had ownership in a practice.

Shifting to Hospital-Owned, Larger Practices

More doctors are working for hospitals or hospital-owned practices. The number of employed physicians who work directly for a hospital increased from 5.6% in 2012 to 8% in 2018. The number of doctors working for a hospital-owned practice increased from about 23% in 2012 to nearly 27% in 2018.

Younger doctors and female physicians are more likely to be employed, the AMA found. Almost 70% of doctors younger than 40 were employees in 2018, compared to 38% of physicians aged 55 or older. Fifty-eight percent of women physicians were employed, compared to 42% of male colleagues.

The highest share of employed physicians — 57% — were family medicine specialists, followed by pediatricians, at 56%. Surgical subspecialists were the least likely to be employed.

Physicians are also migrating to larger practices, whether physician-owned or owned by a hospital or other entity. The majority of doctors still work in small practices, but that number is declining.

Psychiatry had the highest share of physicians in solo practice, at 28%.

In 2018, 57% of doctors worked in a practice with 10 or fewer doctors, down from 61% in 2012. More doctors are joining practices that have 50 or more physicians. Almost 15% of doctors are in those 50+ groups, compared to 12% in 2012. The shift to those big practices is most pronounced for multispecialty groups. Almost 40% of multispecialty practices had 50 or more doctors. Almost 40% of single-specialty groups had practices with five or fewer physicians, and just 8% had 50 or more doctors.

The report's author said that it's not a given that the current trends will continue.

In the mid-1990s, it was thought that it wouldn't be long until a majority of physicians would be employees. "Given that only now has the point been reached where the number of employed physicians exceeds the number of owner physicians, caution should be taken in assuming current trends will continue indefinitely," writes report author Carol Kane, PhD.

Current incentives and regulations are driving doctors to consolidate into larger practices and to integrate with hospital systems, she said.

"Should evolving models of care not deliver on their theoretical savings or improvements, that might put a break [sic] on consolidation," Kane writes.

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