The independence evolution: Practice threats and innovative pivots

Whether you’ve worked in health care for five or 40 years, chances are it looks quite different than when you began. This is especially true if you’ve spent your career at an independent practice.

According to the American Medical Association (AMA), an estimated 42 percent of physicians worked in private practice in 2024, a sizable drop from 60 percent in 2012. From private equity to traditional health systems, getting acquired may feel increasingly more like a “when,” rather than an “if.” But it doesn’t have to be a given.

Approximately half of patients have no preference between independent and corporate-owned practices, but among those that do, 38 percent prefer independent practices while 8 percent prefer corporate practices.

Demand for independent care remains, but maintaining independence has its challenges.

Staffing sustainably

Rising provider shortages and burnout among the health care workforce are some of the greatest threats to practice independence today. The National Center for Health Workforce Analysis projects a shortage of more than 113,000 physicians by 2028, and that staffing gap is expected to increase through 2038.

This not only contributes to frustration and professional dissatisfaction, but also to patient access challenges. Nationally, new appointment wait times are 26 days, on average.

Where does that leave private practices that are facing the same shrinking talent pool as large corporate entities with full talent acquisition teams and greater resources? With the rise of artificial intelligence (AI), practice owners and administrators need to shift from the mindset of merely “doing more with less” to doing less busywork.

Innovations like ambient listening and AI-driven documentation assistance can help ease staffing and access pressures by shortening the amount of time spent on documentation.

Additionally, and perhaps more importantly, these tools also enable providers to fully focus on patients rather than screens during the visit. Restoring the human connection in medicine is a welcome change across all care settings, but it’s especially advantageous for independent practices and those that value a more personal and less corporate patient experience.

Moving margins

If it seems like the cost of running a practice has become an increasingly steep mountain to climb, you’re not just imagining it. In one 2025 survey of medical groups, 90 percent of respondents reported their year-to-date operating costs were higher than at the same point in time the year prior and rose by 11 percent on average.

And while all types of health care organizations are navigating external factors like rising supply costs and tariffs, independent practices are especially feeling the pressure. Medicare payments to independent physicians have decreased by one-third over an approximately 20-year period when adjusted for inflation. Conversely, payments to non-physician providers and non-independent physicians have kept pace with inflation.

Between thinning margins and the shrinking talent pool, practices must get creative with technology to balance budgets. One practical change is to adopt a digital front door solution that enables patients to self-schedule appointments. These tools can reduce no-shows by up to 50 percent, helping to prevent missed revenue. They can also curb denials by catching errors early, as up to 50 percent of claim denials stem from errors made at registration.

Similarly, ambient listening and documentation assistance also have roles to play in the revenue cycle. AI-driven documentation doesn't just save time; it also helps ensure more precise medical coding to improve billing accuracy and revenue capture.

Forging ahead

Many providers are determined to keep their practices private to maintain scheduling flexibility, clinical autonomy and patient trust. And while every technology implementation incurs a cost, adapting operations through innovation is ultimately an investment in the practice’s independence.

But practice independence isn’t an endpoint. It’s a choice. Practice owners and administrators that choose to commit to continual evolution in service of their patients and providers will come out stronger on the other side.

That’s not just independence. That’s resilience.

Jeanne Armstrong, MD, is chief medical information officer for the TouchWorks EHR at Altera Digital Health.