Vertical Integration Versus Physician Owners: Trends in Practice Structure Among Breast Cancer Surgeons

The objective of this study was to document changes in physician practice structure among surgeons who treat women with breast cancer.

We merged cancer registry records from 5 large states with Medicare Part B claims to identify each surgeon who treated women with breast cancer. We added information from SK&A surveys and extensive internet searches. We analyzed changes in breast surgeons' practice structure over time.

We assigned each surgeon-year a practice structure type: (1) small single-specialty practice; (2) single-specialty surgery or multispecialty practice with ownership in an ambulatory surgery center (ASC); (3) physician-owned hospital; (4) multispecialty; (5) employed.

In 2003, nearly 74% of breast cancer surgeons belonged to small single-specialty practices. By 2014, this percentage fell to 51%. A shift to being employed (vertical integration) accounted for only a portion of this decline; between 2003 and 2014, the percentage of surgeons who were employed increased from 10% to 20%. The remainder of this decline is due to surgeons opting to acquire ownership in an ASC or a specialty hospital. Between 2003 and 2014, the percentage of surgeons with ownership in an ASC or specialty hospital increased from 4% to 17%.

Dramatic changes in surgeon practice structure occurred between 2003 and 2014 across the 5 states we examined. The most notable was the sharp decline in the prevalence of the small single-specialty practice and large increases in the proportion of surgeons either employed or with ownership in ACSs or hospitals.