FORECASTS – IT’S THAT TIME OF THE YEAR FOR [Physician] INVESTORS

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No, not the holidays!

Art

By Arthur Chalekian GEPC

[Financial Consultant]

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It’s the time when physician investors begin to consider pundits’ forecasts for the coming year.

Here are a few of those forecasts:     

1. “Flat is the new up,” was the catch phrase for Goldman Sachs’ analysts last August, and their outlook doesn’t appear to have changed for the United States. In Outlook 2016, they predicted U.S. stocks will have limited upside next year and expressed concern that positive economic news may bring additional Fed tightening. Goldman expects global growth to stabilize during 2016 as emerging markets rebound, and Europe and Japan may experience improvement.

2. Jeremy Grantham of GMO, who is known for gloomy outlooks, is not concerned about the Federal Reserve raising rates, according to Financial Times (FT). FT quoted Grantham as saying,

“We might have a wobbly few weeks … but I’m sure the Fed will stroke us like you wouldn’t believe and the markets will settle down, and most probably go to a new high.”

Grantham expects the high to be followed by a low. He has been predicting global markets will experience a major decline in 2016 for a couple years, and he anticipates the downturn could be accompanied by global bankruptcies.

3. PWC’s Trendsetter Barometer offered a business outlook after surveying corporate executives. After the third quarter of 2015, it found:

“U.S. economic fundamentals remain strong, but markets and executives like predictability, and that’s not what we’ve been getting lately … Trendsetter growth forecasts are down, so are plans for [capital expenditure] spending, hiring, and more. It doesn’t help that we’ve entered a contentious 2016 election season …”

4. The Economist had this advice for investors who are reviewing economic forecasts:

“Economic forecasting is an art, not a science. Of course, we have to make some guess. The average citizen would be well advised, however, to treat all forecasts with a bucket (not just a pinch) of salt.”

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[End 2015 – Begin 2016]

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Assessment

Doctor – What are your stock market predictions for 2016?

Conclusion

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OUR OTHER PRINT BOOKS AND RELATED INFORMATION SOURCES:

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Risk Management, Liability Insurance, and Asset Protection Strategies for Doctors and Advisors: Best Practices from Leading Consultants and Certified Medical Planners™8Comprehensive Financial Planning Strategies for Doctors and Advisors: Best Practices from Leading Consultants and Certified Medical Planners™

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3 Responses

  1. In 2016?

    The biggest healthcare business trend in 2016 will be the acceleration of value-based provider contracts being executed by the commercial sector on behalf of self-insured employers and the employees, retirees and dependents who are beneficiaries. This trend builds on and complements the value-based purchasing being done by CMS, by far the dominant single purchaser for almost any provider, that has set ambitious goals for driving forward in the payment models that will sustain a value-based marketplace.

    These new performance oriented contracts, whether focused on creating “shareable savings” through improved population health management and care coordination, or focused on discreet episodes like joint replacements and cardiac surgery, are particularly notable in their alignment of purchaser and provider interests around a mutual goal. Going forward, as providers and purchasers move towards a shared vision of “value” and how best to contract for it, measure it and deliver it, we all stand to benefit.

    Jeremy Nobel MD MPH
    [Northeast Business Group on Health]
    Executive Director, NEBGH’s Solutions & Innovations Center
    Faculty, Center for Primary Care, Harvard Medical School

    Like

  2. 2016 – Business of Healthcare

    In 2016, the business of healthcare will continue to be impacted by “on grid” and “off grid” trends. Identifying three in each category will illustrate the breadth of the opportunities and the cross currents.

    “On Grid” players will build networks of, or vertically integrate with, post-acute resources to manage value based pricing risks such as episode payments. Second, on-grid market participants will take stronger steps to integrate behavioral health capabilities both to step up to the challenges of actualizing mental health parity and to cost effectively manage populations where mental health comorbidities drive total health care costs. Third, providers will accelerate their interest in sponsoring plans to serve Medicare Advantage and managed Medicaid lives resulting in further Congressional support for the programs but also additional local innovation in care delivery and more holistic patient care to mitigate the cost impacts of social and other determinants of health expenditures.

    “Off Grid” players will capture increasing large portions of what would otherwise be traditional health care spending. The retail sector will expand the range of services from pharmacy, DME and urgent care to lab work and beyond. Second, the Amazon Prime method and experience will find its way into health care supply and soon delivery. Third, the web based or in-person purveyors of diet and fitness regimes will build on consumer loyalty to begin to be the mediator and access point for traditional health care choice and spending.

    Mark E. Lutes
    [Chair, Board of Directors / Member of the Firm]
    Epstein Becker Green

    Like

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