APPs now make up more of the provider workforce

For the report, researchers analyzed data from over 200,000 employed providers, including physicians and APPs, in more than 100 different specialties. The data includes information from a range of practices across the United States, including small medical groups, single physician practices, and large academic physician groups.

Currently, APPs make up around 41% of providers in U.S. physician practices. According to industry experts, the ongoing physician shortage, as well as increased demands for primary and surgical care in outpatient settings, have helped to boost growth in the APP workforce.

"Advanced practice providers like physician assistants and nurse practitioners play a vital and increasingly visible role in healthcare," said Matthew Bates, managing director and physician enterprise service line leader with Kaufman Hall.

"When deployed correctly, advanced practice providers let physicians practice at the top of their license. They give doctors more time to focus on diagnosis and treatment, which can make physician practices more efficient and address other challenges, including physician burnout," Bates added.

According to Becker's Hospital Review, previous reports have found that organizations with higher percentages of APPs in their workforces typically outperform peers on productivity and compensation metrics. Findings from the current report further support this dynamic, with the median subsidy per physician increasing 6% to $312,528 between Q1 2024 and Q1 2025.

However, Kaufman Hall noted that physicians' downstream margins may no longer be enough to cover the investment. Between Q1 2024 and Q1 2025, the net patient revenue and total expense per provider full-time equivalent only grew by 5%, which suggests flat margins. 

Advisory Board's APP resources

To gain more insight into the APP workforce and how to best support them, check out these Advisory Board resources.

This toolkit explains four keys to maximizing your ROI with APPs, including deploying APPs autonomously, centralizing onboarding and training, paying the care team performance-based compensation, and involving APPs in group governance.

Similarly, this infographic outlines a scalable model with four components to help organizations get the full value of their APP workforce. The four components include deployment, training, evaluation, and leadership.

As the APP workforce continues to grow, read our take on how to strategically deploy APPs in primary care. This research provides three strategies for APP deployment that can help increase access to primary care in rural markets, improve chronic disease management, and test the viability of new business ideas.

For more information on APPs and other providers, check out our physicians and medical groups and workforce topics.