In recent years, primary care has experienced a profound transformation as hospitals and private equity firms increasingly affiliate with providers, altering the financial and operational dynamics of healthcare delivery.
Primary care is at the center of a sweeping shift as more providers align with hospitals and investors, raising concerns about escalating costs and eroded autonomy. A recent study by Brown University indicates that the proportion of primary care physicians affiliated with hospitals increased from 25.2% in 2009 to 47.9% in 2022, and 1.5% became affiliated with private equity firms. These affiliations are associated with higher healthcare costs, as hospital-affiliated physicians charged 10.7% more for office visits compared to their independent counterparts. Healthcare administrators now face mounting economic pressures as these affiliations redefine fee structures and referral patterns.
As corporate consolidation accelerates, independent primary care practices are experiencing a significant decline, with rural areas losing nearly 2,500 physicians, representing a 5% decrease, and nearly 3,300 medical practices closing between 2019 and 2024. An analysis by the Physicians Advocacy Institute reveals that many small, clinician-owned offices cannot compete on pricing or technology, leading to more than 40% of these practices closing or being acquired by larger entities. This shift not only marginalizes solo and group practices but also narrows the choices available to patients seeking personalized care.
Alongside diminishing autonomy, affiliated practices are adopting standardized operational models that prioritize patient volume and centralized decision-making. This aligns with insights from the Physicians Advocacy Institute, detailing how affiliation with larger corporate entities reconfigures staffing, care protocols, and scheduling systems, often at the expense of local flexibility.
Private equity’s growing footprint adds complexity to this landscape. As noted in the earlier study, investor-backed platforms are driving mergers of multiple practices that amplify consolidation, raising questions about long-term service availability and cost containment in primary care.
Moving into 2025, policymakers and healthcare leaders must weigh the efficiency gains promised by integrated networks against potential trade-offs in access and choice. Strategies such as targeted support for independent clinics, enhanced transparency in affiliation agreements, and incentive structures that preserve clinic-level decision-making could help balance these dynamics. Close monitoring of cost trajectories and patient experience metrics will be essential to ensure that primary care remains both sustainable and responsive to community needs.