The five main types of medical practice in the United States are solo practice, group practice, hospital-owned (or health system-employed) practice, federally qualified health centers (FQHCs), and academic medical centers. Each model differs in how the practice is owned, how physicians are paid, and what the experience looks like for both doctors and patients. About 55% of U.S. physicians currently work in private practice settings (solo or group), 27% are employed by hospitals, 3% work in academic settings, and the rest are spread across public-sector and community health roles.
Solo Practice
A solo practice is owned and operated by a single physician. The doctor handles (or directly oversees) everything from patient care to billing, staffing, and lease agreements. This model gives the physician maximum autonomy over scheduling, treatment decisions, and how the office runs day to day. Solo practitioners set their own hours, choose their own electronic health record systems, and decide which insurance plans to accept.
The tradeoff is financial risk. Overhead costs, including rent, staff salaries, malpractice insurance, and equipment, all fall on one person’s revenue. Solo practices also tend to have less sophisticated health IT infrastructure compared to larger organizations, which can make quality reporting and data tracking more difficult. Solo practice has been declining for years. Private practice overall has dropped about 3 percentage points over the past decade, and the shift has hit solo practitioners hardest as administrative burdens and insurance complexity push physicians toward larger organizations.
Group Practice
A group practice is any arrangement where two or more physicians share ownership, overhead, and administrative resources under a single business entity. Groups file insurance claims under a common tax identification number, meaning the physicians are part of one financially integrated organization. Group practices come in two main varieties: single-specialty and multi-specialty.
A single-specialty group might be three orthopedic surgeons sharing office space, staff, and billing. A multi-specialty group brings together physicians from different fields, such as primary care, cardiology, and endocrinology, under one roof. The coordination advantage is sometimes called “one-stop shopping”: patients can see multiple specialists within the same organization, which simplifies referrals and keeps records in one system. About 40% of generalists in the U.S. practice alongside at least one specialist, and roughly 32% of specialists share a practice with a generalist.
Physician-owned groups have shown a strong track record of controlling costs. Pre- and post-pandemic benchmarking data from the Medical Group Management Association shows that physician-owned multispecialty groups significantly outperformed hospital-owned practices in managing operating expenses. Because these groups are leaner on staffing and have direct financial accountability, their overhead tends to be lower.
Hospital-Owned Practice
In a hospital-owned or health system-employed practice, the physician works as a salaried employee of a hospital or larger health system rather than owning the business. The hospital handles billing, compliance, electronic health records, malpractice coverage, and most administrative functions. In return, the physician gives up a significant degree of decision-making authority. System-owned practices often have their participation in programs, technology platforms, and quality initiatives decided by organizational administrators who may not even be located at the practice site.
Hospital employment has grown from about 25% of all physicians a decade ago to 27% today, representing roughly 206,000 doctors. The appeal is straightforward: a predictable salary, benefits, and freedom from the business side of medicine. The downside is less control. System-owned practices typically use standardized EHR platforms and reporting infrastructure chosen at the corporate level, and physicians may have limited input on operational decisions. Total labor costs in hospital-owned groups can consume 50% to 60% or more of operating expenditures, partly because these organizations carry heavier administrative layers.
Federally Qualified Health Centers
Federally qualified health centers are nonprofit, community-based organizations that receive federal funding to provide primary care in underserved areas. They are required to serve all patients regardless of ability to pay, using a sliding-fee scale based on income. FQHCs must also be governed by a board of directors where a majority of members are patients of the center, ensuring the community has a direct voice in how the organization operates. Tribal and urban Indian organizations are exempt from some of these governance requirements.
FQHCs account for about 22% of primary care practices in large national surveys. They tend to be larger than physician-owned practices, often employing 11 or more clinicians, and are disproportionately located in rural and medically underserved areas. Their patient populations skew heavily toward Medicaid recipients and uninsured individuals. Like hospital systems, FQHCs typically have robust, standardized electronic health records and reporting infrastructure provided by their parent organizations. Individual physicians working in an FQHC have less autonomy than those in private practice, since operational and quality decisions are often made at the organizational level.
Academic Medical Centers
Academic medical centers sit at the intersection of patient care, medical education, and research. This “tripartite mission” is what distinguishes them from every other practice type. Physicians at academic centers are typically faculty members who split their time between seeing patients, training medical students and residents, and conducting research. Only about 3% of U.S. physicians, roughly 26,000, work primarily in academic settings such as universities and professional schools.
A century ago, the ideal academic physician was a “triple threat” who excelled at all three missions simultaneously. That model has largely disappeared. Each mission has become more demanding, and most faculty now concentrate on one or two areas. A common tension in academic centers is that clinical operations generate the revenue that subsidizes research and education. As government funding for research has tightened and the economics of healthcare have shifted, there is ongoing pressure for the clinical side to carry more financial weight, sometimes at the expense of the educational and research missions that define these institutions.
Emerging Models: Direct Primary Care and Concierge Medicine
Beyond the five traditional types, two newer models have gained traction. Direct primary care (DPC) is a membership-based approach where patients pay their physician a monthly, quarterly, or annual fee directly. DPC doctors do not accept insurance or participate in government programs. Without the overhead of insurance billing, DPC physicians can keep patient panels small and spend 30, 60, or even 90 minutes per visit.
Concierge medicine is similar in structure but works differently with insurance. Concierge physicians charge an annual membership fee, typically ranging from $1,200 to $10,000 per year, and also bill the patient’s insurance for visits. Both models prioritize longer appointments and more personalized relationships, but DPC is designed to bypass the insurance system entirely, while concierge medicine layers a membership fee on top of it.
How Practice Type Affects Your Care
The type of practice your doctor works in shapes your experience in concrete ways. In physician-owned solo and group practices, your doctor typically has more authority over how the office runs, which can mean more flexibility in scheduling and treatment decisions. In hospital-owned and FQHC settings, you benefit from more sophisticated health IT systems, easier specialist referrals within the network, and standardized quality reporting, but your doctor may have less individual discretion.
Wait times, visit length, and continuity of care all vary by setting. Larger systems and public hospitals often deal with higher patient volumes and longer waits. Smaller private practices and membership-based models like DPC tend to offer more face time with your physician. Academic medical centers give you access to cutting-edge treatments and clinical trials, but your care team will often include residents and medical students alongside the attending physician. None of these models is inherently better. The right fit depends on your insurance situation, location, how much you value continuity with a single doctor, and whether you need access to specialized or research-driven care.