Independent physicians have spent more than a decade watching the share of their peers who own their own practices shrink.
New data exists that tells the story of what it now costs to stay independent, how much deal-making and closure activity is still working against that choice, and where regulators and a new wave of physician-owned infrastructure are starting to push back.
Taken together, the figures describe less a single trend than a recalculated equation — one where the cost of going it alone, the cost of selling and a growing set of options in between are all moving at once.
The cost of staying independent keeps climbing
- $314,231. That’s the median investment or subsidy a health system or medical group reported per physician full-time equivalent in the second quarter of 2026, according to Kaufman Hall’s Q2 2026 Physician Flash Report, released Aug. 18. The figure was essentially flat from $313,330 a year earlier, but it sits on top of several years of steady increases.
- 3% and 3%. Total direct expense per provider full-time equivalent reached $678,119 in the quarter, up 3% year over year, while net patient revenue per provider full-time equivalent grew at the same rate, to $418,281 — meaning practices are running faster just to hold their margin steady, according to the same Kaufman Hall report.
- 71.3%. Provider labor now makes up 71.3% of total physician enterprise expense, up from 70.5% a year earlier and 69.7% in 2024, even as support staff and non-labor costs shrank as a share of the total, per Kaufman Hall. Compensation per work relative value unit was essentially unchanged, at $62.89.
Deal-making and employment still pull the other way
- 42.4% vs. 60.1%. Just 42.4% of physicians worked in private practice in 2024, down from 60.1% in 2012, according to the American Medical Association’s Physician Practice Benchmark Survey. Physician employment by hospitals, health systems or corporate entities climbed from 62% to 78% between 2019 and 2023, per a December 2025 Progressive Policy Institute analysis.
- More than 40. That’s how many physician practice acquisitions Becker’s tracked in a running tally through the first half of 2026 alone.
- 81% vs. 50%. The trade-off isn’t only financial. In a Bain & Co. survey 81% of physicians in physician-led organizations said they were satisfied with their role in strategic decision-making, compared with just 50% of those in hospital-led practices.
Closures are the sharpest edge of the math
- 30. At least 30 physician practices and ASC shut down or announced closure in the first half of 2026, according to Becker’s reporting.
- 3 recurring causes. Insurance reimbursement that no longer covers the cost of care, staffing shortages severe enough to leave a practice down to a single physician, and rural markets that can’t attract new providers to replace ones who leave or retire, per the same tracking. Consolidation compounds the effect: some of the closures tracked were practices absorbed into health systems rather than shutting down outright.
Regulators are starting to rewrite the equation
- 25 states. That many states have proposed or enacted laws restricting private equity’s involvement in healthcare, according to an Aug. 25 Stateline report.
- $1 trillion. That’s what private equity firms have put into acquiring healthcare companies over the past decade — a scale of investment that helped prompt the state-level response.
- About half. PitchBook data cited in the Stateline report shows private equity-involved healthcare deals declining in the first half of 2026 compared with the first half of 2025, with physician practice management deals specifically expected to fall by about half in 2026.
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