Here are five studies examining the costs and risks associated with physician acquisitions and practice consolidations:
1. Despite claims that consolidation can improve efficiency and cut healthcare costs, numerous studies have demonstrated the opposite. Findings from a 2023 study published in JAMA, physician services delivered through health systems and hospitals cost between 12% and 26% more than those delivered through independent practices.
2. Hospitals acquired by private equity were associated with a 25.4% increase in hospital-acquired conditions, according to a report published in JAMA in December 2023. This figure was driven by a 27.3% increase in falls and a 37.7% increase in central line-associated bloodstream infections, although private equity-acquired hospitals placed 16.2% fewer central lines than their counterparts.
3. The potential for burnout within consolidated networks demonstrably increased among physicians. According to the Physician Foundation's annual "Survey of American Current and Future Physicians, 6 in 10 physicians and residents reported experiencing burnout, and 50% of respondents said healthcare consolidation is having a negative impact on their job satisfaction.
4.Consolidated physicians do experience better leverage with payers. According to a 2023 analysis by the American Medical Association studying physician employment status, many physicians left independent practice to gain better bargaining power with payers, as larger health systems and hospitals typically have better leverage over reimbursement rates than smaller, independent practices.
5. In some cases, acquired practices can offer a wider range of procedures. According to an analysis by Kaufman Hall, nearly 40% of affiliated hospitals added one or more services post-acquisition.