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FORWORD

Financial Planning for Physicians and Advisors

Medical management is already one of the most complex businesses, with advances in science, technology, and consumer awareness often eclipsed by regulation, rights, and financial restrictions.

Navigating a course where sound practice management is intertwined with personal financial security requires a blue print designed by subject matter experts. Financial Planning for Physicians and Healthcare Executives [third edition] provides that blueprint.

The timeliness of this book is underscored by the current state of the health care industry in the United States. Healthcare in the United States is, by design, a system of independent and interrelated organizations. Demand for health care services is escalating due to the demographics of an aging population, advances in medical technology and new courses of treatment. Concurrently, financial resources allocated to health care services are not rising as rapidly as the demand for services.

As a consequence of the unusual economics of today’s health care industry, physicians and health care professionals must plan financially successful professional practices and construct financial security in a manner that is markedly different from that of other businesspersons and professionals.

Financial planning for physicians and health care professionals is not intuitive, nor is it a logical extension of professional pursuits. Physicians are usually motivated by a need to serve humankind and by scientific and intellectual curiosity. Economics and finance are secondary to the pursuits of clinical excellence, service and scientific expansion.

Consider some of the financial aspects unique to health care providers: unlike most other businesses or professions, doing more does not necessarily translate into earning more; providing superior quality service does not necessarily translate into better prices for those services; and abandoning service lines or “markets” with inferior financial yield is anathema to the health care professional’s commitment to patients.

Peak earning years may also be shorter for health care providers than other professionals. Consider that physicians typically enter careers at later ages, often with larger debts from training. Some specialties may not lead a case until 10 years of practice, and many specialties have limited longevity. Financial survival skills are paramount for converting the limited earnings time period to personal financial security.

Financial Planning for Physicians and Healthcare Executives confronts the reality that business management in health care is decidedly more complex than most other businesses or professions. To illustrate, in what other industry can participants debate the simple question, “who is the customer?”

The same business management intricacy gives rise to an information model that is exclusive in its complexity. The fragmented-by-design health care delivery system, rising consumer expectations, and rampaging information technology advances all serve to compound the degree of difficulty in effective use of information technology.

The industry’s track record regarding information systems in terms of increased efficiency, ease-of-use and improved margins has been short of expectations. Information systems aimed at improving workflows, connecting to trading partners and taking advantage of new technologies are still in development. The opportunity remains attractive to information technology providers, as evidenced by a near-continual flow of business venture announcements from technology companies and various industry participants. While the information systems puzzle remains unsolved, the need for skillful management of information systems is an immediate imperative.

This book provides a description of communication systems, data storage and retrieval systems, and health care-specific data sets. Chapters declare that patient safety and quality of care depend on accurate, complete information. Moreover, information systems must reflect that the real-world events that are digitally stored are longitudinal in nature and that privacy and security requirements are paramount.

Government and payer-led initiatives to control health care costs and manage care have resulted in a multifarious regulatory environment. New legislation under consideration covering such areas as patient rights could create new liabilities for physicians and other health care providers. This book describes a medical office compliance program to help avoid the perils of non-compliance.

Of particular note is the new section on HIPAA. When fully implemented, HIPAA will require standard transaction sets, as well as privacy and security mandates. HIPAA legislation is rife with penalties for non-compliance. This book enlightens and instructs by providing a framework for operating in the expected HIPAA world.

Selecting a personal financial strategy requires contracting with other professionals. Just as patients are becoming more informed about a growing range of diagnosis and treatment options, physician providers are learning of a growing range of financial vehicles available to them.

In medicine, the “right” course of diagnosis and treatment is one that balances the risk, cost, time horizon, outcome and personal preferences of the patient. In the world of personal finance, the physician plays the role of patient to the professional advisor who may be from one of many sub-disciplines in the financial world – advisor, broker, insurance agent, attorney or accountant.

The physician must be more informed about the growing range of analysis and investment options in order to choose the “right” course that balances risk, cost, time horizon, outcome and his or her own personal style.

Richard D. Helppie
Former: CEO and Founder
Superior Consultant Company, Inc.
[SUPC-NASD]

Speaker: If you need a moderator or a speaker for an upcoming event, Dr. David Edward Marcinko; MBA – Editor and Publisher-in-Chief – is available for speaking engagements. Contact him at: MarcinkoAdvisors@msn.com

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