Questioning [Physician’s] Upward Social Mobility and the State of the Union Address

Posted on January 29, 2010 by Dr. David Edward Marcinko MBA MEd CMP™

Broad Consensus Seems Impossible for Medical Professionals – and Everyman

By Dr. David Edward Marcinko; MBA, CMP™

[Publisher-in-Chief]

While an undergraduate student at Loyola University in Maryland, I learned from my Jesuit teachers and philosophers that a couple of centuries ago, the decider of all matters of importance in Jerusalem was the Great Sanhedrin, or a council of 71 judges. The council met most every day except on festivals and the Sabbath. It functioned as sort of a combination of the Supreme Court, Congress and a political debate boiler room.

Incorrect Unanimity

As one might imagine, the Sanhedrin’s members normally disagreed as they hammered out their daily opinions; much like today’s political debates over healthcare reform. But occasionally they came to a unanimous decision, and they had an amazing and very wise rule when that occurred: The decision was immediately overturned because the sages believed that a unanimous conclusion among so many individuals just had to be wrong.

THINK: The US Senate and Congress

Rules for Upward Mobility

Anyway, I was thinking about the Sanhedrin’s rule after last night’s 2010 State of the Union address by President Barrack H. Obama while I was considering the current state of the economic union for doctors – specifically. The translation is easy for non-physicians [everyman] as well; so bear with me.

Anyway, I was struck by the fact that if there was one grand unified theory which gets at least 90-100% agreement from current generations of America’s medical and lay punditocracy – it is the rules for upward [medical professional] mobility.

These rules, especially for second generation Americans like me, were:

  • A medical degree [college education] leads to a lucrative profession [job] and a satisfying lifestyle.
  • [Working hard], or practicing long hours, means your income will grow.
  • Devotion to medicine, or your job, will produce a comfortable retirement.
  • Your children will follow your career path [job] and create a lasting legacy

The Paradigm Shift

Today, with a national unemployment rate hovering around 10%, doctors and everyman may need to reconsider the above unwritten rules that have governed our upward mobility since the end of World War II. As the son of a GM auto worker – I did decades ago – and still do.

For example, from 1945 to 2000, various private and public health insurance mechanisms were developed, along with the idea that health insurance was a fringe benefit in lieu of the wage and price controls instituted after the war. Today it is even considered a “right” by some.

Nevertheless, the doctor-class was a surrogate for the affluent American upper middle class lifestyle, and a type of perpetual prosperity machine that created wealth.

There were periodic general economic dislocations of course, like the recessions of the mid-1970s and early 1980s, and the rise of managed care in the early 1990s. But, wealth seemed to compound for physicians, and progress always resumed its upward trajectory. This was especially true for all medical professional during the “golden age of medicine” [circa 1965-1990, approx].

After all, wasn’t [isn’t] healthcare considered a recession proof business? Perhaps no more!

The Physician Net-Worth Numbers

Then: I was involved in study a few years ago [September 16, 2008] which determined that the average 47 year-old physician, earning $180,000 annually, needed to amass a net-worth of about $5.5-M in order to maintain the same lifestyle throughout retirement at age 65.

Link: http://www.hcplive.com/finance/publications/pmd/2005/92/3951

Link: www.CertifiedMedicalPlanner.com

Now: Today, with the DJIA down about 30% from its’ October 2008 high, is this retirement / employment scenario still possible? Are our opinions Sanhedrin-like?

And remember, the estate tax laws sunset back to their original rates in 2011. Moreover, many financial advisors, like me, believe income tax rates and brackets will increase going forward; along with increasingly onerous regulations for small businessmen and women like physicians and private medical practitioners. New business innovations of all stripes will also be adversely affected.

Full Disclosure: I am founder of the Certified Medical Planner™ online education program for financial advisors and medical management consultants.

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Assessment

And so, I ask, do the rules of upward mobility for physicians or everyman still apply; or have they changed?  Why or why not? If so, is the change permanent or temporary, and is it for the positive or negative. Please consider financial, societal and/or generational implications.

IOW: Is President Barack H. Obama correct?

Conclusion

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Speaker: If you need a moderator or speaker for an upcoming event, Dr. David E. Marcinko; MBA – Publisher-in-Chief of the Medical Executive-Post – is available for seminar or speaking engagements. Contact: MarcinkoAdvisors@msn.com

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5 Responses

  1. Clark, on January 29, 2010 at 1:55 AM said:

    Still Talking About the State of the [Healthcare] Union Address

    President Obama was about half way through the State of the Union when he finally addressed health reform. He emphasized the phrase “health insurance reform” a few times — which could indicate a shift away from a complete overhaul of the health care system.

    So, here is the heart of the president’s comments on reform:
    http://www.physiciansnews.com/2010/01/28/state-of-the-union-health-reform/

    And, here are four issues Obama did not talk about in his SUA:
    http://articles.moneycentral.msn.com/Investing/Dispatch/market-dispatches.aspx?post=1586161&_blg=1,1586161

    PS: Since Mr. Market was down today, s/he must not think much of his SUA.

    Clark

    Like

  2. Sam, on January 29, 2010 at 4:50 PM said:

    Too little – too late?

    Good, but not enough. That’s how some academics and financial advisors characterize President Barack Obama’s plans to help Americans save more for retirement; as revealed in his SUA.

    http://www.fa-mag.com/fa-news/5133-obamas-retirement-savings-plans-arent-enough.html

    Samantha

    Like

  3. Sue, on January 30, 2010 at 12:05 PM said:

    Republican Politicians and Medical Professionals

    Please heed Dr. Marcinko’s warning in the current healthcare and related policy debates. The rules have changed.

    Susan

    Like

  4. Brian J. Knabe MD CMP™, on August 25, 2010 at 2:04 PM said:

    There is no doubt that the “golden age of medicine” is over, and with it the presumption that the physician’s standard of living and upward mobility will continue indefinitely.

    Since the 1990’s we have been welcoming in a new age of cost-containment, government oversight and intervention, as well as pay-for-performance and other innovative reimbursement models. Those physicians who continue to prosper will need to have a deep understanding of this business of medical practice, a thorough and well-constructed business plan, and an ability to change and adapt to new circumstances.

    Brian J. Knabe MD CMP™

    Like

  5. Ken Yeung MBA CMP™ candidate, on April 7, 2014 at 10:19 PM said:

    On Social Mobility

    The Paradigm Shift of upward social mobility has certainly made its’ presence felt for the upper middle working class (especially for physicians) who have seen their net worth depleting from the latest healthcare reform, as well as more taxation for high bracket income earners. This is really disturbing to the “USA brand” where people all over the world perceive that it is the greatest country to be in – and where freedom of choice and upward social mobility were thought to be limitless.

    For example, I was recently at a dinner chatting with an attorney who used to help citizens from all over Asia gain residency to the USA. However; his latest practice had become more of his former clients trying to reverse back their citizenship status away from the USA.

    Yes, there is definitely a Paradigm Shift in America.

    Ken Yeung MBA CMP™ candidate
    http://www.CertifiedMedicalPlanner.org

    Like

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