Independent physicians in rural America fell 43% between January 2019 and January 2024, from 21,956 to 12,467, according to an analysis by Avalere Health for the Physicians Advocacy Institute (PAI). That is a loss of nearly 9,500 independent rural physicians in five years.
The analysis used the IQVIA OneKey database. It marked a physician as rural by provider ZIP code, using the crosswalk from the HRSA Federal Office of Rural Health Policy. Healthcare Innovation reported the findings on April 7, 2025.
What changed between 2019 and 2024
At the start of 2019, rural areas had 52,600 practicing physicians working in 30,000 medical practices, Healthcare Innovation reported from the Avalere data. By January 2024 the physician total was about 50,100, a loss of nearly 2,500 physicians, or 5%. The practice count fell to 26,700, a drop of 3,300 practices, or 11%.
The independent segment fell much faster than the total. Avalere counted about 7,300 fewer independent rural practices, a 42% decline. PAI says more than 40% of independent practices closed or were acquired by hospitals, health systems, or other corporate entities, including insurer-affiliated owners and private equity groups.
| Measure (rural U.S.) | Jan. 2019 | Jan. 2024 | Change |
|---|---|---|---|
| All practicing physicians | 52,600 | about 50,100 | -5% |
| All medical practices | 30,000 | 26,700 | -11% |
| Independent physicians | 21,956 | 12,467 | -43% |
| Independent practices | not stated | not stated | -7,300 (-42%) |
Source: Avalere Health for the Physicians Advocacy Institute, via Healthcare Innovation (April 7, 2025) and the Pennsylvania Office of Rural Health (April 8, 2025).
Dividing the independent count by the rounded physician totals gives a rough share. Independent physicians were about 41.7% of rural physicians in 2019 and about 24.9% in 2024. These two percentages are our calculation, not figures from PAI.
Where the physicians went
Most of the shift went to larger owners. Corporate entities nearly doubled their ownership of rural practices and held 6,168 practices as of January 2024, Healthcare Innovation reported. They employed nearly 3,200 more physicians than in 2019, a 57% increase.
Hospitals and health systems grew more slowly. They employed 15% more rural physicians than in 2019 and owned 11% more practices. By January 2024, 61% of rural medical practices were owned by non-physicians. PAI puts the share of rural physicians employed by hospitals, health systems, or corporate entities at 76%. The Healthcare Innovation summary gives 75% for the same measure.
Avalere compared two snapshots, January 1, 2019 and January 1, 2024. The counts show the net result over five years and do not show the year-by-year path or any practice that opened and closed in between. PAI groups hospitals, health systems, insurer-affiliated owners, and private equity groups together as the owners that absorbed independent practices.
Which states lost the most
Ten states lost more than 50% of their independent rural physicians over the five years: Indiana, Iowa, Maine, Massachusetts, Minnesota, New Hampshire, New Jersey, Ohio, South Carolina, and South Dakota. Healthcare Innovation singled out the Midwest and the Northeast as the regions where the departures from independent practice were most pronounced.
Across the whole country, nearly 9,500 physicians left independent rural practice. The PAI summary page lists the states but does not publish each state's physician count.
Cost data from the same years
The Avalere data does not say why practices closed or sold, so it supports no cause. Cost data from MGMA gives context for the period. In MGMA Stat's analysis of operating costs, cost per full-time-equivalent physician rose more than 63% from 2013 to 2022, while the Medicare conversion factor rose 1.7% over the same years.
The pressure continued into 2026. In an MGMA Stat poll of 251 groups on June 23, 2026, 84% said year-to-date operating costs were higher than at the same point in 2025. Among those groups, the average increase was about 11%. MGMA also reported that 80% of groups say Medicare payment is below their cost to deliver care.
In a July 8, 2025 poll, 65% of leaders named labor as the cost area with the biggest percentage increase that year. MGMA DataDive shows five-year increases of 15% to 22% in median total compensation for medical receptionists, medical assistants, and LPNs. In a September 2025 poll, 64% of groups planned base-pay raises of 1% to 3% for 2026, and 23% planned raises of 4% to 6%.
Outside prices moved too. MGMA cited a 4.2% annual consumer price increase in May 2026, a PwC 2026 medical cost trend of 8.5% for the group market, and a Vizient projection of 2.41% for medical supply costs in 2026.
How a practice manager can use the numbers
The national rural figures work as a baseline for a local check. Count the independent practices and the owned practices in your referral area today and compare them with a list from 2019. If your area lost 42% of its independent practices, it matched the rural average. If it lost far fewer, your market is holding better than the 10 states that fell past 50%.
The ownership split matters for referrals and payer contracts. With 61% of rural practices owned by non-physicians, a majority of the practices a rural group refers to now belong to a larger organization. Any referral map or payer rate comparison built on 2019 data describes a market with 3,300 more practices than the rural U.S. has now.
The count also gives a way to size the change per year. Nearly 9,500 independent physicians over five years averages about 1,900 per year, and 7,300 independent practices averages about 1,460 per year. Both averages are our calculation from the report totals.
Sources
- Physicians Advocacy Institute, PAI-Avalere Report: Rural Areas Face Steep Decline in Independent Physicians and Practices, data for January 1, 2019 to January 1, 2024
- Healthcare Innovation, Study Highlights Steep Decline in Rural Independent Practices, April 7, 2025
- Pennsylvania Office of Rural Health, Rural U.S. Loses 43% of Independent Physicians: 5 Things to Know, April 8, 2025
- MGMA Stat, Operating costs keep climbing for medical practices in 2026, June 24, 2026
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