Why more doctors can’t make ends meet

Axios – Tuesday, August 12, 2025
By Tina Reed

America’s doctors are working harder and getting paid less. And that could soon translate into less access for some patients.

The big picture: A new report from consultancy Kaufman Hall shows primary care physicians and specialists are delivering more services since the pandemic. But they’re not making more money because of stagnant reimbursements from public and private insurers and inflation.

• The data helps explain why medical practice bankruptcies hit a six-year high last year — and why some providers are shifting to pricey procedures for cash-paying customers to boost their bottom lines.

By the numbers: There was a roughly 5% increase in net revenue per full-time provider between the second quarters of 2023 and 2025, Kaufman Hall said, based on data from more than 200,000 clinicians across the country.

• But over the same period, the amount of net revenue per unit of work — generally understood to mean how much a physician generates for the volume of work they put in — fell 7%, the report found.

Between the lines: A reckoning may not be far off, with millions of Americans projected to lose coverage due to changes in Republicans’ tax-and-spending bill.

• “In the coming months if more patients lose insurance coverage, this trend will likely get worse,” said Kaufman Hall managing director Matthew Bates.
• The anticipated drop-off in income is compounded by rising labor costs, which already make up 84% of total expenses for medical groups. And some physicians struggle to find and hold on to good help.
• “At some point this growth in productivity starts to be impeded if the doctor has to go out and check in their own patients and take their vitals, they’re not gonna be able to see as many patients,” Bates said.

The end of the COVID-19 crisis didn’t improve business for many practitioners, as troubling trends that surfaced during COVID-19 have persisted.

• The consultancy Gibbins Advisors found there were 57 medical practice bankruptcies with more than $10 million in liabilities last year.
• While the bankruptcy filings have slowed this year, Clare Moylan, a principal at Gibbins, said it doesn’t necessarily signal a turnaround.
• “The health care sector has a lot of macro shifts causing distress for providers,” she said, pointing to persistent workforce shortages, elevated supply expenses and now, the threat of tariff-driven inflation.
• Meanwhile, bankruptcies amid smaller practices of between $500,000 and $2 million in revenue have been steadily rising in the last two to three years, said Daniel Gielchinsky, a partner at DGIM Law in Florida who specializes in bankruptcies.

Between the lines: Among the disturbing trends Gielchinsky has observed are medical practices branching into med spa-like services and investing in Botox supplies and skin-tightening lasers in hopes of capturing wealthy patients seeking elective procedures.

• They’re finding out that consumers have less disposable income than they expected, and the competition is fierce.
• “We had one bankruptcy where the equipment was literally unused. They didn’t get a single patient in the door to do any laser treatments, but they’ve had this $800,000 machine they’re making payments on every month,” he said.

Many doctors have opted to sell their practices to a health system or private equity firm. But critics say that has accelerated the corporatization of medicine and put power in the hands of for-profit entities that have raised prices and put shareholder value above patients’ interests.

The other side: Doctors could see up to a 3.8% increase to their Medicare payments next year under a Trump administration proposal released earlier this summer.

• But to maximize their reimbursements, practices would have to agree to be paid based on patient outcomes instead of the volume of services delivered.
• “There is a little relief on the reimbursement side coming in 2026 to help combat those headwinds,” Moylan said.

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