Health System or Independent Practice? A New Study Says the Decision Runs Deeper Than Finances

Think Like an Owner-Entrepreneur

Health System or Independent Practice? A New Study Says the Decision Runs Deeper Than Finances.

I want to share a piece of research with you that landed on my desk this week and that I think deserves a place in this community's ongoing conversation about employment versus independence. It is a qualitative study published in the July/August 2026 issue of the Annals of Family Medicine -- one of the most respected journals in primary care medicine -- titled "Physician Experiences in Health System-Owned Practices and Independent Practices: Insights From Interviews With Primary Care Physicians." The researchers are from RAND Corporation, funded by the Agency for Healthcare Research and Quality.

I am going to walk through what they found, because it validates, with peer-reviewed data from interviews with real physicians,  the argument at the center of everything this community teaches. And then I want to push the argument further than the study takes it, because the study describes the trade-offs but does not resolve them. That is where physician entrepreneurship does its most important work.

Study at a glance

Title: Physician Experiences in Health System-Owned Practices and Independent Practices: Insights From Interviews With Primary Care Physicians

Published: Annals of Family Medicine, Vol. 24, No. 4, July/August 2026

Authors: McCleskey, DeYoreo, Zhang, O'Hollaren, Timbie (RAND Corporation)

Method: Semistructured interviews with 30 primary care physicians -- 15 employed by health systems, 15 practicing independently, comparing experiences across autonomy, care coordination, infrastructure, and patient relationships

What the Research Found

The researchers identified five major themes across the two groups. I want to name each one and then say what it means for the physician entrepreneur identity conversation we have every Wednesday in this space.

Theme one: autonomy and legal protections.

Health system physicians reported less autonomy in scheduling and day-to-day operations but greater financial and legal protections. Independent physicians valued flexibility and ownership as central to their professional identity. One health system physician put it plainly in the interviews: "Too many administrators telling me what to do, what not to do... micromanaging my practice, demanding that I work harder, charge more... The CEO told a patient I spent too much time with my patients. I'm a family doctor. I enjoy my patients."

Independent physicians described the inverse experience. One said they see fifteen to eighteen patients a day, close the office the last Monday of every month for a staff breather, and reported a high level of satisfaction directly tied to controlling how many patients they see and how long they spend per visit. Several independent physicians said explicitly that they would not trade autonomy for the higher income a health system might offer: "Even if we were making more money in a hospital system, we would not be willing to give up the autonomy."

Theme two: clinical support teams and specialist access.

Health system physicians had access to embedded behavioral health counselors, pharmacists, patient navigators, dieticians, and social workers. Independent physicians operated with smaller teams, mostly nurses and medical assistants, and managed complex patients with limited on-site support. Both groups acknowledged the real infrastructure advantage of health system employment for team-based care.

Theme three: care coordination.

Shared electronic health records in health systems made coordination easier, a single platform showing test results, specialist visits, and hospitalizations across the system. Independent physicians described spending substantial time assembling information from faxed notes, patient reports, and calls to outside specialists. One said: "We waste more time trying to get records and labs, whereas a bigger healthcare system is more seamless, fewer gaps, fewer delays."

Theme four: time, relationships, and productivity culture.

This is the theme that I think matters most for the ownership identity conversation. Health system physicians described an organizational culture focused intensely on quantitative metrics, productivity targets, patient satisfaction scores, quarterly peer comparisons. One said: "We almost feel like a Target cashier who's getting rated. They're focused just on the patient satisfaction numbers not on whether you're practicing good medicine."

Independent physicians described exactly the opposite culture. Long-term relationships. Continuity with families over years. An organizational priority around time per patient rather than patients per hour. One said: "People come here because we spend the time and listen to them... We have extended families that we've seen for a long time... That's why I went into private practice, because I wanted to form that relationship over a period of time."

Theme five: communication and patient access.

Health system centralized call structures created barriers. Physicians described advising patients not to call the office directly because calls would be routed to a central pool and might take three days to reach the physician. Independent physicians described the opposite: patients calling and reaching a known staff member directly, same day. One independent physician said: "Patients like the responsiveness. They like that if they call, they get a live person."

The overall comparison looks like this. I can attest from spending the first half of my career as a health system employee and the 2nd half as an independent physician that these observations are accurate.

Health system employment characteristics

• Financial and legal protections

• Embedded clinical support teams

• Shared EHR coordination

• Specialist access simplified

• Productivity and metric culture

• Centralized, slower patient communication

• Less scheduling autonomy

Independent practice characteristics

• Full scheduling and operational control

• Smaller teams, greater agility

• Manual coordination, relationship-based

• Specialist access through personal networks

• Continuity and relationship culture

• Direct, responsive patient access

• Higher burnout protection through flexibility

Related resources

Blog: Doctors Weren't Designed to Be Healthcare Factory Workers

Blog: You Were Meant for More Than Healthcare Factory Work

Blog: Most Physicians Are Renting Their Careers. Here's What That's Costing You.

Free eBook: Healing the Healers: Overcoming Physician Burnout (subscriber free)

Free book: Doctor Incorporated -- the full case for independence with the financial framework

What the Study Gets Right and Where the Conversation Needs to Go Further

The RAND researchers describe the trade-offs accurately and without bias. Health systems provide real infrastructure advantages. Independent practice provides real autonomy advantages. The conclusion, that primary care physicians in each model face distinct trade-offs influencing care delivery and satisfaction is honest and well-supported by the interview data.

What the study does not fully address is the model that sits between these two poles. The employment lite structure, contracting your professional services through a professional corporation rather than accepting direct employment, is not captured in the study's binary. It is not traditional health system employment. It is not fully independent private practice either. It is the arrangement where a physician continues working in the same clinical environment, for the same institution, serving the same patients, but as a contractor with a professional services agreement rather than as an employee.

That structure changes the autonomy and culture dynamic significantly without requiring the physician to build a practice from scratch or sacrifice the institutional infrastructure that the study correctly identifies as a genuine advantage of health system affiliation. The scheduling autonomy that independent physicians described as essential to their professional wellbeing- setting visit lengths, controlling panel size, closing the office for a breather— is recoverable within a properly structured contractor arrangement at the same institution. The productivity metric culture that health systems employed physicians described as the primary threat to their professional identity, the feeling of being a Target cashier rated on satisfaction scores is negotiated differently when you are a contractor whose professional services agreement defines the terms of your engagement rather than an employee subject to policies the institution writes unilaterally.

This is the gap between what the RAND study describes and what physician entrepreneurship actually makes available. The binary the study examines is real. It is just not the only choice.

"The study found that much of what distinguishes the two models relates to the organization of work itself, not clinical decision-making. Integration and shared resources improved technical coordination but did not necessarily enhance the patient-physician relationship or contribute to physician well-being."

That finding from the RAND discussion section is the most important sentence in the paper for this community. The researchers concluded that what makes health system employment feel constraining is not the clinical environment but the organization of work, the scheduling, the productivity metrics, the communication structures, the culture. Those are exactly the dimensions that the employment lite model, properly structured, gives the physician far more control over. The clinical environment stays the same. The organization of work changes.

Related resources

Blog: Physician Employment 2.0: The Secret World of Employment Lite

Blog: Why Employment Lite Is the Best Model for Physician Independence

Free eBook: PSAs and Employment Lite Guide (subscriber free)

Free eBook: Business Mindset Shift: Mapping the Transformation of Your Professional Identity (PEA Explorer)

Blog: Saying Yes to Self-Employment Is Not a Career Move. It's an Identity Decision.

The Part of This Conversation That Is Not About Money

I want to be explicit about something that the research confirms and that I think gets underweighted in how most physicians approach this decision.

The choice between health system employment and independent practice is often presented, including in how this community sometimes discusses it, primarily as a financial question. How much more can I earn? What is the retained income gap? What does the solo 401(k) allow versus the 403(b)? These are real questions with real answers that matter. But the RAND study is a reminder that the financial dimension, while significant, is not what most physicians actually name when they describe why the choice matters to them.

What they name is identity. What kind of physician do I want to be? What kind of relationship do I want to have with my patients? What does practice feel like when I own it versus when I work inside someone else's structure? The independent physicians in the study described their autonomy as inseparable from their sense of professional meaning, not as a financial advantage but as a fundamental dimension of who they are as physicians and what they believe medicine is for. Several said explicitly they would not trade that autonomy for more money.

That is the identity decision I write about every Wednesday. The financial framework matters -- a lot -- and it is what most of the rest of this week's content covers. But the reason most physicians in this community eventually make the move toward independence is not the retained income number. It is a feeling that arrived before the number, a sense that the work had stopped belonging to them, that the institution had gradually claimed ownership of something that was theirs, and that they wanted it back.

The RAND study gives peer-reviewed language to that feeling. I hope you will share it with a colleague who is trying to articulate why the employment situation they are in does not feel right, and who has not yet found the words for it.

Case Study: Dr. Okonkwo's Spreadsheet Moment

Dr. Okonkwo (name protected) is a family physician who spent eleven years in traditional health system employment before he came to a coaching session with me. He was not in financial distress. He was not at a crisis point. He described his situation in exactly the terms the RAND study would predict: limited scheduling control, a productivity culture that felt disconnected from clinical quality, a sense that the institution had gradually taken ownership of decisions that should have been his to make.

What broke the inertia was not a burnout event. It was a spreadsheet his wife built on a Sunday evening comparing his W-2 employment income against what the same gross revenue would produce through an S-Corp micro-corporation. The retained income gap was $34,000 per year. He called me the following week.

But when I asked him what he actually wanted from the transition, his answer had almost nothing to do with the $34,000. He wanted to set his own schedule. He wanted to control how much time he spent per patient. He wanted to stop being evaluated against productivity metrics that he believed had no relationship to the quality of care he provided. The money was the permission slip. The identity was the reason.

Eight months after that coaching session, he was working under a professional services agreement with the same health system, in the same clinic, with the same patients. His retained income exceeded the projection. His scheduling autonomy was contractually protected. He told me the chess match with his employer, the endless move and counter-move cycle the RAND study describes as a defining feature of health system employment culture was over. Not because he had left. Because he had changed his relationship with the institution from employee to owner.

Ready to own the decision?

The RAND study puts peer-reviewed weight behind something this community has known for years: the choice between health system employment and independent practice is not primarily a financial one. It is a question about what kind of physician you want to be, what kind of practice culture you want to work in, and what kind of relationship you want to have with your patients and your professional identity.

The financial case for independence is real and I cover it in detail throughout this blog. But the identity case is what brings most physicians to the decision -- and what sustains the commitment when the transition is hard. If the RAND study's findings about autonomy, culture, and patient relationship quality describe what is missing from your current arrangement, that is the most important data point you have.

The free eBook Business Mindset Shift: Mapping the Transformation of Your Professional Identity is the right starting resource for physicians who recognize the identity dimension of this decision and want to think through it deliberately before making structural moves.

Book a $500 Business Strategy Session and we will map both dimensions of the decision -- the identity and the financial -- in one conversation, so the move you make is grounded in both what you want your professional life to look like and what the structure that delivers it actually requires.

Join the PEA community at $99/year for Explorer membership. The free ESCAPE from Corporate Medicine eBook and the free digital copy of Doctor Incorporated are both available to Explorer members and are where the full argument lives. The RAND researchers described the trade-offs. This community is where physicians come to resolve them.