WORKER’S COMPENSATION: Physician Insurance

Posted on March 22, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By Staff Reporters

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While some medical practitioners and facilities can operate without Professional Liability Insurance coverage, one business related insurance that cannot / should not be avoided is Worker’s Compensation.  Employers in all but seven states – so-called “monopolistic” states because they have their own state funds, are under statutory obligation to provide coverage for their employees.  Historically, Worker’s Compensation pre-dates Social Security entitlements and well before the emergence of employer sponsored group benefits.

The coverage under worker’s compensation provides for lost income due to on-the-job accidents or work-related disability or death and the amount of benefits vary by state.  In some instances, the coverage will reimburse the employee for medical expenses incurred with the accident. 

The four general benefits covered under Worker’s Compensation are:

Medical Care – for expenses incurred usually without limitations on amount or period of care.

Disability Income – payable for both total and partial disability and is usually based on 66 2/3 percent of their wage base.

Death Benefits – generally fall into two categories; one a flat amount for “burial” insurance; and two, survivor benefits.  Though varying by state, these benefits are similar to the disability payment (a percentage of weekly base wages) but may be capped as to total benefit, such as $50,000 or a period, such as 10 years

Rehabilitation Benefits – includes not only medical rehabilitation, but vocational rehabilitation, vocational counseling, retraining or educational benefits, and job placement

Traditionally, the secondary purpose of Worker’s Compensation was to reduce potential litigation because employees accepting the benefits from a Worker’s Compensation claim generally waived their right to sue their employer. 

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However, in our litigious society, this “protective shelter” has been severely tested and is crumbling.

Employers may provide their Worker’s Compensation three ways:

  • Private commercial insurance
  • State government funds
  • Self-insurance

Very few factors drive the premium structure – the occupation of the workers is the single most important determinant of premiums.  An office worker may have premiums as low as $.10 per hundred of wages and a coal miner may exceed $50.00 per hundred of wages.  Generally speaking, however, Worker’s Compensation premiums for the medical profession or healthcare worker are among the lowest available.

Therefore, for the medical practice, some physicians may consider self-insurance because the weekly benefits are typically below $500, thus making this decision attractive. 

Alternatively, because officers and owners can elect not to be covered by Worker’s Compensation, the decision to purchase coverage from a private insurance company may afford inexpensive assurance that the benefits will be conveniently provided, and administered, by a private insurance company for their employees.

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HEDGE FUND: Terms and Definitions

Posted on March 22, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

By Staff Reporters

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  • Absolute Return – the goal is to have a positive return, regardless of market direction.  An absolute return strategy is not managed relative to a market index.
  • Accredited Investor – wealthy individual or well-capitalized institutions covered under Regulation D of the Securities Act of 1933.
  • Alpha – the return to a portfolio over and above that of an appropriate benchmark portfolio (the manager’s “value added”).
  • Arbitrage – any strategy that invests long in an asset, and short in a related asset, hoping the prices  will converge.
  • Attribution – the process of “attributing” returns to their sources.  For example, did the returns to a portfolio (over and above some benchmark) come from stock selection, industry/sector over- or under-weighting or factor weighting.  Software programs are helpful in reporting an attribution.
  • Beta – a measure of systematic (i.e., non-diversifiable) risk.  The goal is to quantify how much systematic risk is being taken by the fund manager vis-à-vis different risk factors, so that one can estimate the alpha or value-added on a risk-adjusted basis.
  • Correlation – a measure of how strategy  returns  move with one another, in a range of –1 to +1.  A correlation of –1 implies that the strategies move in opposite directions.  In constructing a portfolio of hedge funds, one usually wants to combine a number of non-correlated strategies (with decent expected returns) to be well diversified.
  • Drawdown – the percentage loss from a fund’s highest value to its lowest, over a particular time frame.  A fund’s “maximum drawdown” is often looked at as a measure of potential risk.
  • Hurdle Rate – the return where the manager begins to earn incentive fees.  If the hurdle rate is 5% and the fund earns 15% for the year, then incentive fees are applied to the 10% difference.
  • Leverage – one uses leverage if he borrows money to increase his position in a security.  If one uses leverage and makes good investment decisions, leverage can magnify the gain.  However, it can also magnify a loss.
  • Opportunistic – a general term that describes an aggressive strategy with a goal of making money (as opposed to holding on to the money one already has).

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  • Pairs Trading – usually refers to a long/short strategy where one stock is bought long, and a similar stock is sold short, often within the same industry.  Buying the stock of Home Depot and shorting Lowe’s in an equal amount would be an example.
  • Portfolio Simulation – involves testing an investment strategy by “simulating” it with a database and analytic software.  Often referred to as “backtesting” a strategy.  The simulated returns of the strategy are compared to those of a benchmark over a specific time frame to see if it can beat that benchmark.
  • Sharpe Ratio – a measure of risk-adjusted return, computed by dividing a fund’s return over the risk-free rate by the standard deviation of returns.  The idea is to understand how much risk was undertaken to generate the alpha.
  • Short Rebate – if you borrow stock and then sell it short, you have cash in your account.  The short rebate is the interest earned on that cash.
  • R-Squared – a measure of how closely a portfolio’s performance varies with the performance of a benchmark, and thus a measure of what portion of its performance can be explained by the performance of the overall market or index.  Hedge fund investors want to know how much performance can be explained by market exposure versus manager skill.
  • Transportable Alpha – the alpha of one active strategy can be combined with another asset class.  For example, an equity market-neutral strategy’s value-added can be “transported” to a fixed income asset class by simply buying a fixed income futures contract.  The total return comes from both sources.
  • Value at Risk – a technique which uses the statistical analysis of historical market trends and volatilities to estimate the likelihood that a specific portfolio’s losses will exceed a certain amount.

Cite: https://www.hedgefundmarketing.org/

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ABOUT State Medical Licensing Boards

Posted on March 22, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

A CONTROVERSY?

By Staff Reporters

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DEFINITION

State medical boards are the agencies that license medical doctors, investigate complaints, discipline physicians who violate the medical practice act, and refer physicians for evaluation and rehabilitation when appropriate. The overriding mission of medical boards is to serve the public by protecting it from incompetent, unprofessional, and improperly trained physicians. Medical boards accomplish this by striving to ensure that only qualified physicians are licensed to practice medicine and that those physicians provide their patients with a high standard of care.

The right to practice medicine is a privilege granted by the state. Each state has laws and regulations that govern the practice of medicine and specify the responsibilities of the medical board in regulating that practice. These regulations are laid out in a state statute, usually called a medical practice act. State medical boards establish the standards for the profession through their interpretation and enforcement of this act.

Assembling a quality physician population to meet the needs of the public begins with licensure. During the process of evaluating applicants for medical licensure, state medical boards’ primary focus is on a physician’s qualifications, including undergraduate and graduate medical education, work history, and personal character.

Candidates for licensure also must successfully complete a rigorous examination designed to assess their ability to apply knowledge, concepts, and principles of health and disease that constitute the basis for safe and effective patient care.

The Federation of State Medical Boards of the United States, Inc., and the National Board of Medical Examiners (NBME) have collaborated to establish a single, 3-step examination for medical licensure in the United States, known as the United States Medical Licensing Examination (USMLE). The USMLE provides state medical boards with a common evaluation system for all licensure applicants. To assure the continued relevance of the exam, the NBME uses basic science and clinical faculty from the nation’s medical schools as well as practicing physicians, some of whom serve on state medical boards, to generate the examinations.

Cite: https://journalofethics.ama-assn.org/article/role-state-medical-boards/2005-04

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OPINIONS

“… I am persuaded that licensure has reduced both the quantity and quality of medical practice…It has reduced the opportunities for people to become physicians, it has forced the public to pay more for less satisfactory service, and it has retarded technological development…I conclude that licensure should be eliminated as a requirement for the practice of medicine”

-Milton Friedman, Nobel prize-winning economist

“As a rule, regulation is acquired by the industry and is designed and operated primarily for its benefit”

-George J. Stigler Nobel Prize-winning economist

“Licensing has served to channel the development of health care services by granting an exclusive privilege and high status to practitioners relying on a particular approach to health care, a disease-oriented intrusive approach rather than a preventive approach….By granting a monopoly to a particular approach to health care, the licensing laws may serve to assure an ineffective health care system”

-Lori B. Andrews, Professor of Law, Chicago-Kent College

“Let us allow physicians, hospitals and schools to spring up where they’re needed, abolish the restrictive licensure laws, and simply invoke the laws against fraud to insure honesty among all providers of health care …That will make health care affordable for everyone”

-Ron Paul, MD former Texas Congressman

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DAILY UPDATE: Medicare TeleHealth Coverage as Wall Street Stock Markets Rise

Posted on March 22, 2025 by Dr. David Edward Marcinko MBA MEd CMP™

MEDICAL EXECUTIVE-POST – TODAY’S NEWSLETTER BRIEFING

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Essays, Opinions and Curated News in Health Economics, Investing, Business, Management and Financial Planning for Physician Entrepreneurs and their Savvy Advisors and Consultants

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Stocks on Wall Street shook off a weak start and closed slightly higher Friday, snapping a four-week losing streak.

CITE: https://tinyurl.com/2h47urt5

The S&P 500 edged up 0.1%. The index finished with a 0.5% gain for the week. It’s still down 4.8% so far this month. The Dow Jones Industrial Average eked out a 0.1% gain, while the NASDAQ composite rose 0.5%.

CITE: https://tinyurl.com/tj8smmes

It appears Medicare coverage for tele-health is here to stay—at least for the next six months. When the House of Representatives and Senate passed a budget on March 11t and 14th, respectively, they not only avoided a government shutdown, but also extended a resolution for Medicare to cover non-behavioral health tele-health appointments until September 30th.

Visualize: How private equity tangled banks in a web of debt, from the Financial Times.

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