The practice settings of the approximately 75,000 physicians in active practice in California are many and varied, with a wide range of size, ownership, legal structure, and affiliations. Further, those practice settings are rapidly evolving in a changing market and policy environment. At the health system level, market consolidation has accelerated, raising concerns about market power, increasing prices, and the erosion of independent practices. COVID-19 has exacerbated challenges faced by providers, particularly small independent practices, and accelerated physician retirement and exit. The role of private equity has expanded in health care, including among physician practices, generating debate about the implications for costs and patient care. Health care costs continue to increase, crowding out other spending priorities and creating affordability and access challenges for patients. Physician services account for 20% of total health care spending, the second largest category behind hospital care at 31%.6 Despite physicians’ central role in delivering care to California residents, information about the structure, characteristics, business practices, contractual arrangements, and financing of physician practices is piecemeal, siloed, and may not be publicly available. In addition, lack of shared definitions and language about the structure and characteristics of physician practices and organizations can create confusion, exacerbated by the tremendous variation and complexity in contractual relationships and payment arrangements, including delegated responsibilities between payers and providers. The purpose of this paper is twofold. First, to review available information sources on the physician practice landscape in California with a focus on existing regulatory and reporting requirements. Second, to begin to create common language and terminology about physician practices and organizations with the goal of enabling a more substantive discussion of relevant policy issues--highlighting gaps in currently available information, and possibilities and prospects for a potential Office of Health Care Affordability, which may require additional reporting from many actors in the health care system.
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