PAI-Avalere Health Report on Physician Employment Trends and Practice Acquisitions: 2018-2026

PAI and Avalere Health have engaged in a long-term research collaboration to study how consolidation trends are impacting physicians. This report adds two additional years’ data (2024 and 2025) to previous research and provides insights into: (1) the trend of acquisitions of physician practices by hospitals/health systems (hereby referred to as “hospitals”) and other types of corporate entities; and (2) the dramatic shift of physicians from independent practice to employment. Trends were considered at various geographic levels: national, regional, state, and rural.

Key Findings

• More than four in five physicians (82.0%) are now employed by hospitals or other corporate entities, continuing a decade-long trend away from private practice.
• More than six in ten physician practices (63.9%) are now owned by hospitals or other corporate entities, driven by the marketplace race to acquire physician practices.
• Physician employment (80.2%) and physician practice ownership (67.8%) in rural areas mirrored national trends, reflecting the shift in the rural healthcare market.

National Physician Employment Trends

More than four in five (82.0%) physicians were employed by hospitals or corporate entities such as private equity firms or health insurers as of January 1, 2026.

• 59.7% of physicians were employed by hospitals; 22.3% were employed by corporate entities.
• The percentage of employed physicians grew by 5.6% from 2024-2026, largely due to hospitals.

253,000 additional physicians became employees of hospitals or corporate entities from January 2018 to January 2026; 48,100 additional physicians were employed between 2024 and 2026.

• 181,200 additional physicians became hospital employees over the eight-year period.
  • 44,000 of the growth occurred from 2024-2026.
• 71,800 additional physicians became corporate employees over the eight-year period.
  • Corporate physician employment leveled off in 2023-2025 but hit a new peak in 2026.
• 152,200 fewer physicians were operating independently over the eight-year period.
  • 23,900 of the shift occurred from 2024-2026.

National Medical Practice Acquisitions and Ownership Trends

Hospitals and other corporate entities acquired 85,000 additional physician practices from 2018-2026, totaling 157,200 (63.9%). Almost 13,900 practices were acquired from 2024-2026, increasing by 9.7%. Corporate ownership (33.2%) continued to outweigh hospital ownership (30.6%).

• Hospitals acquired 32,800 additional physician practices over the eight-year period.
  • 5,800 of these acquisitions occurred from 2024-2026.
• Corporate entities acquired 52,300 additional physician practices over the eight-year period.
  • Only 8,000 acquisitions occurred from 2024-2026, moderating from January 2022.
• 81,100 fewer physician practices were owned by physicians over the eight-year period.
  • 12,500 of the shift occurred from 2024-2026.

Regional Physician Employment and Practice Acquisition Trends

In the last two years, all regions of the country experienced continued growth in physician employment and practice acquisitions at a moderate pace similar to the overall national trend.

Over the eight-year period between 2018-2026:

• Non-independent physicians increased between 66.1% (Midwest) and 106.7% (South).
• Non-physician-owned practices increased between 86.4% (Midwest) and 140.2% (South).

Rural Physician Employment and Practice Acquisition Trends

The number of physicians practicing in rural areas decreased from 2018 to 2024 and started to increase again over the past year; however, the share of physicians and practices continues to shift toward hospital and corporate employment. From 2024 to 2026, the percentage of employed physicians grew by 6.8% and non-physician owned medical practices grew by 9.8% in rural areas.

Over the eight-year period between 2018-2026:

• 11,900 additional rural physicians became hospital employees, reaching a share of 62.4%.
• 4,500 additional rural physicians became corporate employees, reaching a share of 17.8%.
• 4,400 additional rural practices were acquired by hospitals, reaching a share of 42.1%.
• 4,200 additional rural practices were acquired by corporate entities, reaching a share of 25.7%

Download the Full Report, Key Findings, and Press Release