RE-BROADCAST: An Interview with Fiduciary Bennett Aikin AIF®

Posted on May 18, 2024 by Dr. David Edward Marcinko MBA

On Financial Fiduciary Accountability

[By Dr. David E. Marcinko MBA MEd CMP™]

[By Ann Miller; RN, MHA]

Currently, there is a growing dilemma in the financial sales and services industry. It goes something like this:

What is a financial fiduciary?
Who is a financial fiduciary?
How can I tell if my financial advisor is a fiduciary?

Now, in as much as this controversy affects laymen and physician-investors alike, we went right to the source for up-to-date information regarding this often contentious topic, for an email interview and Q-A session, with Ben Aikin.

About Bennett Aikin AIF® and fi360.com

Bennett [Ben] Aikin is the Communications Coordinator for fi360.com. He oversees all communications for fi360. His responsibilities include messaging, brand management, copyrights and trademarks, and publications. Mr. Aikin received his BA in English from Virginia Tech in 2003 and is currently an MS candidate in Journalism from Ohio University.

Q. Medical Executive Post

You have been very helpful and gracious to us. So, let’s get right to it, Ben. In the view of many; attorneys, doctors, CPAs and the clergy are fiduciaries; most all others who retain this title seem poseurs; sans documentation otherwise.

A. Mr. Aikin

You are correct. Attorneys, doctors and clergy are the prototype fiduciaries. They have a clear duty to put the best interests of their clients, patients, congregation, etc., above their own. [The duty of a CPA isn’t as clear to me, although I believe you are correct]. Furthermore, this is one of the first topics we address in our AIF training programs, and what we call the difference between a profession and an industry. The three professions you name have three common characteristics that elevate them from an industry to a profession:

Recognized body of knowledge
Society depends upon practitioners to provide trustworthy advice
Code of conduct that places the clients’ best interests first

Q. Medical Executive Post

It seems that Certified Financial Planner®, Chartered Financial Analysts, Registered Investment Advisors and their representatives, Registered Representative [stock-brokers] and AIF® holders, etc, are not really financial fiduciaries, either by legal statute or organizational charter. Are we correct, or not? Of course, we are not talking ethics or morality here. That’s for the theologians to discuss.

A. Mr. Aikin

One of the reasons for the “alphabet soup”, as you put it in one of your white papers [books, dictionaries and posts] on financial designations, is that while there is a large body of knowledge, there is no one recognized body of knowledge that one must acquire to enter the financial services industry. The different designations serve to provide a distinguisher for how much and what parts of that body of knowledge you do possess. However, being a fiduciary is exclusively a matter of function.

In other words, regardless of what designations are held, there are five things that will make one a fiduciary in a given relationship:

You are “named” in plan or trust documents; the appointment can be by “name” or by “title,” such as CFO or Head of Human Resources
You are serving as a trustee; often times this applies to directed trustees as well
Your function or role equates to a professional providing comprehensive and continuous investment advice
You have discretion to buy or sell investable assets
You are a corporate officer or director who has authority to appoint other fiduciaries

So, if you are a fiduciary according to one of these definitions, you can be held accountable for a breach in fiduciary duty, regardless of any expertise you do, or do not have. This underscores the critical nature of understanding the fiduciary standard and delegating certain duties to qualified “professionals” who can fulfill the parts of the process that a non-qualified fiduciary cannot.

Q. Medical Executive Post

How about some of the specific designations mentioned on our site, and elsewhere. I believe that you may be familiar with the well-known financial planner, Ed Morrow, who often opines that there are more than 98 of these “designations”? In fact, he is the founder of the Registered Financial Consultants [RFC] designation. And, he wrote a Foreword for one of our e-books; back-in-the-day. His son, an attorney, also wrote as a tax expert for us, as well. So, what gives?

A. Mr. Aikin

As for the specific designations you list above, and elsewhere, they each signify something different that may, or may not, lend itself to being a fiduciary: For example:

• CFP®: The act of financial planning does very much imply fiduciary responsibility. And, the recently updated CFP® rules of conduct does now include a fiduciary mandate:

• 1.4 A certificant shall at all times place the interest of the client ahead of his or her own. When the certificant provides financial planning or material elements of the financial planning process, the certificant owes to the client the duty of care of a fiduciary as defined by CFP Board. [from http://www.cfp.net/Downloads/2008Standards.pdf]

• CFA: Very dependent on what work the individual is doing. Their code of ethics does have a provision to place the interests of clients above their own and their Standards of Practice handbook makes clear that when they are working in a fiduciary capacity that they understand and abide by the legally mandated fiduciary standard.

• FA [Financial Advisor]: This is a generic term that you may find being used by a non-fiduciary, such as a broker, or a fiduciary, such as an RIA.

• RIA: Are fiduciaries. Registered Investment Advisors are registered with the SEC and have obligations under the Investment Advisers Act of 1940 to provide services that meet a fiduciary standard of care.

• RR: Registered Reps, or stock-brokers, are not fiduciaries if they are doing what they are supposed to be doing. If they give investment advice that crosses the line into “comprehensive and continuous investment advice” (see above), their function would make them a fiduciary and they would be subject to meeting a fiduciary standard in that advice (even though they may not be properly registered to give advice as an RIA).

• AIF designees: Have received training on a process that meets, and in some places exceeds, the fiduciary standard of care. We do not require an AIF® to always function as a fiduciary. For example, we allow registered reps to gain and use the AIF® designation. In many cases, AIF designees are acting as fiduciaries, and the designation is an indicator that they have the full understanding of what that really means in terms of the level of service they provide. We do expect our designees to clearly disclose whether they accept fiduciary responsibility for their services or not and advocate such disclosure for all financial service representatives.

Q. Medical Executive Post

Your website, http://www.fi360.com, seems to suggest, for example, that banks/bankers are fiduciaries. We have found this not to be the case, of course, as they work for the best interests of the bank and stockholders. What definitional understanding are we missing?

A. Mr. Aikin

Banks cannot generally be considered fiduciaries. Again, it is a matter of function. A bank may be a named trustee, in which case a fiduciary standard would generally apply. Banks that sell products are doing so according to their governing regulations and are “prudent experts” under ERISA, but not necessarily held to a fiduciary standard in any broader sense.

Q. Medical Executive Post

And so, how do we rectify the [seemingly intentional] industry obfuscation on this topic. We mean, our readers, subscribers, book and dictionary purchasers, clients and colleagues are all confused on this topic. The recent financial meltdown only stresses the importance of understanding same.

For example, everyone in the industry seems to say they are the “f” word. But, our outreach efforts to contact traditional “financial services” industry pundits, CFP® practitioners and other certification organizations are continually met with resounding silence; or worse yet; they offer an abundance of parsed words and obfuscation but no confirming paperwork, or deep subject-matter knowledge as you have kindly done. We get the impression that some FAs honesty do-not have a clue; while others are intentionally vague.

A. Mr. Aikin

All of the evidence you cite is correct. But that does not mean it is impossible to find an investment advisor who will manage to a fiduciary standard of care and acknowledge the same. The best way to rectify confusion as it pertains to choosing appropriate investment professionals is to get fiduciary status acknowledged in writing and go over with them all of the necessary steps in a fiduciary process to ensure they are being fulfilled. There also are great resources out there for understanding the fiduciary process and for choosing professionals, such as the Department of Labor, the SEC, FINRA, the AICPA’s Personal Financial Planning division, the Financial Planning Association, and, of course, Fiduciary360.

We realize the confusion this must cause to those coming from the health care arena, where MD/DO clearly defines the individual in question; as do other degrees [optometrist, clinical psychologist, podiatrist, etc] and medical designations [fellow, board certification, etc.]. But, unfortunately, it is the state of the financial services industry as it stands now.

Q. Medical Executive Post

It is as confusing for the medical community, as it is for the lay community. And, after some research, we believe retail financial services industry participants are also confused. So, what is the bottom line?

A. Mr. Aikin

The bottom line is that lay, physician and all clients have a right to expect and demand a fiduciary standard of care in the managing of investments. And, there are qualified professionals out there who are providing those services. Again, the best way to ensure you are getting it is to have fiduciary status acknowledged in writing, and go over the necessary steps in a fiduciary process with them to ensure it is being fulfilled.

Q. Medical Executive Post

The “parole-evidence” rule, of contract law, applies, right? In dealing with medical liability situations, the medics and malpractice attorneys have a rule: “if it wasn’t written down, it didn’t happen.”

A. Mr. Aikin

An engagement contract accepting fiduciary status should trump a subsequent attempt to claim the fiduciary standard didn’t apply. But, to reiterate an earlier point, if someone acts in one of the five functional fiduciary roles, they are a fiduciary whether they choose to acknowledge it or not. I have attached a sample acknowledgement of fiduciary status letter with copies of our handbook, which details the fiduciary process we instruct in our programs, and our SAFE, which is basically a checklist that a fiduciary should be able to answer “Yes” to every question to ensure the entire fiduciary process is being covered.

Q. Medical Executive Post

It is curious that you mention checklists. We have a post arguing that very theme for doctors and hospitals as they pursue their medial error reduction, and quality improvement, endeavors. And, we applaud your integrity, and wish only for clarification on this simple fiduciary query?

A. Mr. Aikin

Simple definition: A fiduciary is someone who is managing the assets of another person and stands in a special relationship of trust, confidence, and/or legal responsibility.

Q. Medical Executive Post

Who is a financial fiduciary and what, if any, financial designation indicates same?

A. Mr. Aikin

Functional definition: See above for the five items that make you a fiduciary.

Financial designations that unequivocally indicate fiduciary duty: Short answer is none, only function can determine who is a fiduciary.

Q. Medical Executive Post

Please repeat that?

A. Mr. Aikin

Financial designations that indicate fiduciary duty: none. It is the function that determines who is a fiduciary. Now, having said that, the CFP® certification comes close by demanding their certificants who are engaged in financial planning do so to a fiduciary standard. Similarly, other designations may certify the holder’s ability to perform a role that would be held to a fiduciary standard of care. The point is that you are owed a fiduciary standard of care when you engage a professional to fill that role or they functionally become one. And, if you engage a professional to fill a non-fiduciary role, they will not be held to a fiduciary standard simply because they have a particular designation. One of the purposes the designations serve is to inform you what roles the designation holder is capable of fulfilling.

It is also worth keeping in mind that just being a fiduciary doesn’t equate to a full knowledge of the fiduciary standard. The AIF® designation indicates having been fully trained on the standard.

Q. Medical Executive Post

Yes, your website mentions something about fiduciaries that are not aware of same! How can this be? Since our business model mimics a medical model, isn’t that like saying “the doctor doesn’t know he is doctor?” Very specious, with all due respect!

A. Mr. Aikin

I think it is first important to note that this statement is referring not just to investment professionals. Part of the audience fi360 serves is investment stewards, the non-professionals who, due to facts and circumstances, still owe a fiduciary duty to another. Examples of this include investment committee members, trustees to a foundation, small business owners who start 401k plans, etc. This is a group of non-sophisticated investors who may not be aware of the full array of responsibilities they have.

However, even on the professional side I believe the statement isn’t as absurd as it sounds. This is basically a protection from both ignorant and unscrupulous professionals. Imagine a registered representative who, either through ignorance or design, begins offering comprehensive and continuous investment advice. Though they may deny or be unaware of the fact, they have opened themselves up to fiduciary liability.

Q. Medical Executive Post

Please clarify the use of arbitration clauses in brokerage account contracts for us. Do these disclaim fiduciary responsibility? If so, does the client even know same?

A. Mr. Aikin

By definition, an engagement with a broker is a non-fiduciary relationship. So, unless other services beyond the scope of a typical brokerage account contract are specified, fiduciary responsibility is inherently not applicable. Unfortunately, I do imagine there are clients who don’t understand this. Furthermore, AIF® designees are not prohibited from signing such an agreement and there are some important points to understand the reasoning.

First, by definition, if you are entering into such an agreement, you are entering into a non-fiduciary relationship. So, any fiduciary requirement wouldn’t apply in this scenario.

Second, if this same question were applied into a scenario of a fiduciary relationship, such as with an RIA, this would be a method of dispute resolution, not a practice method. So, in the event of dispute, the advisor and investor would be free to agree to the method of resolution of their choosing. In this scenario, however, typically the method would not be discussed until the dispute itself arose.

Finally, it is important to know that AIF/AIFA designees are not required to be a fiduciary. It is symbolic of the individuals training, knowledge and ongoing development in fiduciary processes, but does not mean they will always be acting as a fiduciary.

Q. Medical Executive Post

Don’t the vast majority of arbitration hearings find in favor of the FA; as the arbitrators are insiders, often paid by the very same industry itself?

A. Mr. Aikin

Actual percentages are reported here: http://www.finra.org/ArbitrationMediation/AboutFINRADR/Statistics/index.htm However, brokerage arbitration agreements are a dispute resolution method for disputes that arise within the context of the securities brokerage industry and are not the only means of resolving differences for all types of financial advisors. Investment advisers, for example, are subject to respond to disputes in a variety of forums including state and federal courts. Clients should look at their brokerage or advisory agreement to see what they have agreed to. If you wanted to go into further depth on this question, we would recommend contacting Brian Hamburger, who is a lawyer with experience in this area and an AIFA designee. Bio page: http://www.hamburgerlaw.com/attorneys/BSH.htm.

Q. Medical Executive Post

What about our related Certified Medical Planner® designation, and online educational program for financial advisors and medical management consultants? Is it a good idea – reasonable – for the sponsor to demand fiduciary accountability of these charter-holders? Cleary, this would not only be a strategic competitive advantage, but advance the CMP™ mission to put medical colleagues first and champion their cause www.CertifiedMedicalPlanner.org above all else.

A. Mr. Aikin

I think it is a good idea for any plan sponsor to demand fiduciary status be acknowledged from anyone engaged to provide comprehensive and continuous investment advice. I also think it is a good idea to be proactive in verifying that the fiduciary process is being followed.

Q. Medical Executive Post

Is there anything else that we should know about this topic?

A. Mr. Aikin

Yes, a further note about fi360’s standards. I wrote generically about the fiduciary standard, because there is one that is defined by multiple sources of regulation, legislation and case law. The process defined in our handbooks, we call a Fiduciary Standard of Excellence, because it covers that minimum standard and also best practice standards that go above and beyond. All of our Practices, which comprise that standard, are legally substantiated in our Legal Memoranda handbook, which was written by Fred Reish’s law firm, who is considered a leading ERISA attorney.

Additional resources:

Q. Medical Executive Post

Thank you so much for your knowledge and willingness to frankly share it with the Medical-Executive-Post.

Assessment

All are invited to continue the conversation with Mr. Aikin, asynchronously online, or thru this contact information:

fi360.com
438 Division Street
Sewickley, PA 15143
412-741-8140 Phone
866-390-5080 Toll-free phone
412-741-8142 Fax

Conclusion

Your thoughts and comments on this ME-P are appreciated. Feel free to review our top-left column, and top-right sidebar materials, links, URLs and related websites, too. Then, subscribe to the ME-P. It is fast, free and secure.

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

OUR OTHER PRINT BOOKS AND RELATED INFORMATION SOURCES:

HOSPITALS: http://www.crcpress.com/product/isbn/9781466558731
CLINICS: http://www.crcpress.com/product/isbn/9781439879900
ADVISORS: www.CertifiedMedicalPlanner.org
BLOG: www.MedicalExecutivePost.com

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SUBMITTED ESSAYS: Economics, Management and Finance from Advisors to Physicians

Posted on May 18, 2024 by Dr. David Edward Marcinko MBA

By Staff Reporters

SPONSOR: http://www.MARCINKOASSOCIATES.com

Finance, economics and management essays of most current interest to all physicians and healthcare professionals

READ ESSAYS: https://marcinkoassociates.com/articles-essays/

Check back periodically for practical updates. Our catalogue library of major books, texts, case models and dictionaries is suggested for additional financial, economic, business and medical practice management information and education.

COMMENTS APPRECIATED

Thank You

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PHYSICIANS BEWARE: Traditional Financial Planning “Rules of Thumb”

Posted on May 17, 2024 by Dr. David Edward Marcinko MBA

DOCTORS AND MEDICAL PROFESSIONALS BEWARE?

We ARE Different!

SPONSOR: http://MarcinkoAssociates.com

By Dr. David E. Marcinko MBA CMP®

SPONSOR: http://www.CertifiedMedicalPlanner.org

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While financial planning rules of thumbs are useful to people as general guidelines, they may be too oversimplified in many situations, leading to underestimating or overestimating an individual’s needs. This may be especially true for physicians and many medical professionals. Rules of thumb do not account for specific circumstances or factors occurring at a particular time, or that could change over time, which should be considered for making sound financial decisions.
Great Health Industry Resignation: https://medicalexecutivepost.com/2021/12/12/healthcare-industry-hit-with-the-great-resignation-retirement/

For example, in a tight job market, an emergency fund amounting to six months of household expenses does not consider the possibility of extended unemployment. I’ve always suggested 2-3 years for doctors. Venture capitalist lay-offs of physicians during the pandemic confirm this often criticized benchmark opinion of mine.

As another example, buying life insurance based on a multiple of income does not account for the specific needs of the surviving family, which include a mortgage, the need for college funding and an extended survivor income for a non-working spouse. Again a huge home mortgage, or several children or dependents, may be the financial bane of physician colleagues and life insurance.

CITE: https://www.r2library.com/Resource/Title/082610254

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EXAMPLES: Old/New Rules

A home purchase should cost less than an amount equal to two and a half years of your annual income. I think physicians in practice for 3-5 years might go up to 3.5X annual income; ceteras paribus.
Save at least 10-15% of your take-home income for retirement. Seek to save 20% or more.
Have at least five times your gross salary in life insurance death benefit. Consider 10X this amount in term insurance if young, and/or with several children or other special circumstances.
Pay off your highest-interest credit cards first. Agreed.
The stock market has a long-term average return of 10%. Agreed, but appreciated risk adjusted rates of return..
You should have an emergency fund equal to six months’ worth of household expenses. Doctors should seek 2-3 years.
Your age represents the percentage of bonds you should have in your portfolio. Risk tolerance and assets may be more vital.
Your age subtracted from 100 represents the percentage of stocks you should have in your portfolio. Risk tolerance and assets may still be more vital.
A balanced portfolio is 60% stocks, 40% bonds. With historic low interest rates, cash may be a more flexible alternative than bonds; also avoid most bond mutual funds as they usually never mature.

There are also rules of thumb for determining how much net worth you will need to retire comfortably at a normal retirement age. Here is the calculation that Investopedia uses to determine your net worth:

If you are employed and earning income: ((your age) x (annual household income)) / 10.
If you are not earning income or you are a student: ((your age – 27) x (annual household income)) / 10.
NET WORTH: https://medicalexecutivepost.com/2007/11/26/assets-liabilities-and-personal-net-worth/
INCOME: https://medicalexecutivepost.com/2008/04/22/medical-income-salary-maximization/

Compensation in the Physician Specialties: Mostly Stable - NEJM CareerCenter Resources

RULES 72, 78 and 115: https://medicalexecutivepost.com/2022/01/30/the-rules-of-72-78-and-115/

INVITATION: https://medicalexecutivepost.com/2021/05/08/invite-dr-marcinko-to-your-next-big-event/

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FINANCE: https://www.amazon.com/Comprehensive-Financial-Planning-Strategies-Advisors/dp/1482240289/ref=sr_1_1?ie=UTF8&qid=1418580820&sr=8-1&keywords=david+marcinko

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Filed under: "Doctors Only", Accounting, Career Development, Ethics, Financial Planning, Glossary Terms, iMBA, Inc., Insurance Matters, LifeStyle, Op-Editorials, Portfolio Management, Recommended Books, Retirement and Benefits, Touring with Marcinko | Tagged: debt, FICO, financial rules of thumb, like insurance, Marcinko, mortgages, net worth, physician budgets, rates return, retirement, Risk Adjusted Rate Return, ROI | Leave a comment »

ADVICE: Investment or Medical Practice Management Second Fiduciary Opinions

Posted on May 17, 2024 by Dr. David Edward Marcinko MBA

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MARCINKO & ASSOCIATES, Inc.

SPONSOR: http://www.MARCINKOASSOCIATES.com

Dr. David Edward Marcinko MBA MEd CMP®

Certified Medical Planner®

SPONSOR: http://www.CertifiedMedicalPlanner.org

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FINANCIAL PLANNING

CAREER DEVELOPMENT

MEDICAL PRACTICE BUY IN / OUT

INVESTMENT ANALYSIS

PORTFOLIO MANAGEMENT

MERGERS AND ACQUISITIONS

PRACTICE APPRAISALS AND VALUATIONS

RETIREMENT PLANNING

FEE-ONLY

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CONTACT: Ann Miller RN MHA

EMAIL: MarcinkoAdvisors@msn.com

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2nd OP

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ACOs: Regulatory Environment Scrutiny

Posted on May 16, 2024 by Dr. David Edward Marcinko MBA

By Health Capital Consultants, LLC

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Because of the federal government’s preference for, and reliance on the success of, accountable care organizations (ACOs), some ACOs assume their legal status shields the organization from legal scrutiny on all issues.

However, since the 2010 advent of ACOs, the law has adapted uniquely to these organizations. This fourth installment of a five-part series on the valuation of ACOs will discuss this unique regulatory environment in which ACOs operate. (Read more…)

COMMENTS APPRECIATED

Thank You

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Filed under: "Doctors Only", Accounting, CMP Program, Ethics, Experts Invited, Health Economics, Health Insurance, Health Law & Policy, Healthcare Finance, Practice Management, Practice Worth | Tagged: Accountable Care Organizations, ACO, ACOs, HCC, Health Capital Consultants | Leave a comment »

REIMBURSEMENT: Valuation of Accountable Care Organizations

Posted on May 16, 2024 by Dr. David Edward Marcinko MBA

By Health Capital Consultants, LLC

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Valuation of Accountable Care Organizations: Reimbursement

The U.S. healthcare payment and delivery system is increasingly moving to a value- and quality-based system. Accountable care organizations (ACOs) are at the forefront of delivering high-quality and cost-effective care to millions of Medicare beneficiaries and privately insured patients, incentivized by substantial shared savings for those who increase quality while containing costs.

CITE: https://www.r2library.com/Resource

This third installment of a five-part series on the valuation of ACOs will discuss the reimbursement environment in which ACOs participate.(Read more…)

COMMENTS APPRECIATED

Thank You

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HOSPITALS: https://www.amazon.com/Financial-Management-Strategies-Healthcare-Organizations/dp/1466558733/ref=sr_1_3?ie=UTF8&qid=1380743521&sr=8-3&keywords=david+marcinko
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Parkinson’s Law of Triviality in Time Management, Economics and Finance

Posted on May 16, 2024 by Dr. David Edward Marcinko MBA

The Attention a Problem Gets is Inverse to its’ Importance

Courtesy: http://www.CertifiedMedicalPlanner.org

By Dr. David Edward Marcinko MBA, MEd CMP

Historian Cyril Parkinson’s wrote in his book Parkinson’s Law,

“The time spent on any item of the agenda will be in inverse proportion to the sum [of money] involved.”

EXAMPLE: Parkinson described a fictional finance committee with three tasks: approval of a $10 million nuclear reactor, $400 for an employee bike shed, and $20 for employee refreshments in the break room.

The committee approves the $10 million nuclear reactor immediately, because the number is too big to contextualize, alternatives are too daunting to consider, and no one on the committee is an expert in nuclear power.

Bike Shed Effect: The bike shed gets considerably more debate. Committee members argue whether a bike rack would suffice and whether a shed should be wood or aluminum, because they have some experience working with those materials at home.

Employee refreshments take up two-thirds of the debate, because everyone has a strong opinion on what’s the best coffee, the best cookies, the best chips, etc.

Absurd: The world is filled with these absurdities. In personal finance, Ramit Sethi recently said we should stop asking $3 questions (should I buy coffee?) and ask more $30,000 questions (should I buy a smaller home?). Most people don’t, because it’s hard and intimidating. In any given moment the easiest way to deal with a big problem is to ignore it and fill your time thinking about a smaller one.

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Assessment: Your thoughts and comments related to the post Corona Virus Pandemic, meetings and time management and psychology are appreciated.

THANK YOU

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Filed under: "Doctors Only", Glossary Terms, Investing, LifeStyle, Touring with Marcinko | Tagged: Cyril Parkinson, Marcinko, Parkinson’s Law of Triviality, time management | 2 Comments »

CUSTOMIZABLE e-PODIATRY CONSENT FORMS Now Available for 2024

Posted on May 15, 2024 by Dr. David Edward Marcinko MBA

Electronically CUSTOMIZABLE FOR EVERY FOOT / ANKLE / LEG SURGEON

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http://www.ePodiatryConsentForms.com

CUSTOMIZABLE CMS & AGENCY FOR HEALTHCARE RESEARCH AND QUALITY STYLED PROTOCOLS, CHECKLISTS AND TEMPLATES

.… Specifically for Podiatrists ….

e-Podiatry Consent Forms™ is an innovative new suite of software programs from the Institute of Medical Business Advisors [iMBA, Inc]. Our products solve your informed consent problems and enhance the education, discussion and documentation of the informed consent process for all podiatrists performing foot, ankle and leg reconstructive surgical procedures.

THE PROBLEM

All podiatrists are being pressured by the Centers for Medicare and Medicaid Services [CMS], the Joint Commission on Accreditation of Healthcare Organizations [JCAHO], liability carriers and private insurance payers to make their consent process more patient-friendly, informed and easily understood. And, the pressure to standardize and comply is great.

Most recently, based on the need to make healthcare even safer, the Agency for Healthcare Research and Quality (AHRQ) undertook a major study to identify patient safety issues and develop recommendations for “best practices”.

The AHRQ Evidence Report

The AHRQ report identified the challenge of addressing shortcomings such as missed, incomplete or not fully comprehended informed consent, as a significant patient safety issue and opportunity for improvement.

The authors of the AHRQ report hypothesized that better informed patients:

“are less likely to experience errors by acting as another layer of protection.”

And, the AHRQ study ranked a “more interactive informed consent process” among the top 11 practices supporting more widespread implementation; especially for surgical consent forms.

THE SOLUTION

Why Us: https://epodiatryconsentforms.com/why-us/

One answer to the modern risk-management problem of “informed consent interactivity” may be e-Podiatry Consent Forms™ We license two core interactive surgical products, and a reference library, with related concepts and products in development:

Forefoot, Mid-Foot and Simple Rear-Foot Version
Complex Rear-Foot, Ankle and Lower Leg Version
Comprehensive content library for extreme customization.

Each e-Podiatry Consent Forms™ CD-ROM [secure email delivery is now available] is increasingly trusted as the simple solution to standardized communications across the entire office-enterprise; from managing-risk, informing-patients and complying with modern regulatory requirements through enhanced patient-centric informed consent encounters.

Thus, by improving the consistency, details, documentation and effectiveness of the informed consent process, e-Podiatry Consent Forms™ equips all podiatric surgeons with the tools needed to augment quality standards, reduce litigation potential and improve patient outcomes and safety.

http://www.ePodiatryConsentForms.com

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ORDER NOW: MarcinkoAdvisors@msn.com

DELIVERY: By email only

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Filed under: "Doctors Only", Op-Editorials, Risk Management, Touring with Marcinko | Tagged: e-Podiatry Consent Forms™, foot surgery consent forms, Marcinko, podiatrist, podiatry, Podiatry Consent Forms, surgery consent form | 1 Comment »

PODIATRY PREP: Pass All Your Board Certification Examinations in 2024

Posted on May 15, 2024 by Dr. David Edward Marcinko MBA

Celebrating 30 Years of Your Success!

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Engineers at MIT want to optimize your jog. Some of the brightest minds in math and science have created a predictive model that can tell you what kind of shoe you would run best in. The model assesses a person’s height, weight, and leg length to simulate their gait in sneakers of different materials and mid-soles. It then projects the optimal shoe based on which one produces the most efficient running form (i.e., which uses as little energy as possible per stride).

And so, as 3D printing and related tech continue to drive sneaker innovation, the researchers say their model will be beneficial to designers who want to create new kinds of highly functional kicks (Adidas funded some of the research).

Why? Marketing and product sales, of course. But, some experts suggest improved shoes might increase your running away speed by 8-10% while reducing injuries.

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D.E. MARCINKO & ASSOCIATES: Financial Planning and Business Management Education for Physicians

Posted on May 15, 2024 by Dr. David Edward Marcinko MBA

By Dr. David Edward Marcinko MBA MEd CMP™

CONSULTING ADVICE – NOT MANAGEMENT

“AT YOUR SERVICE”

E-mail: MarcinkoAdvisors@msn.com

SPONSOR: http://www.MarcinkoAssociates.com

Marcinko & Associates is financial guide. We help answer your questions in an empowering way. We educate and guide medical colleagues to understand their financial picture and to make better financial decisions. We strive to simplify everything, clear up confusion, and address specific needs and goals.

Simply put, we’re a financial services company on a mission to empower financial freedom for all healthcare professionals; only. We work with doctors, nurses, medical providers, individuals and all sizes of organizations to offer investment, wealth management and retirement solutions so everyone can have a clear and simple understanding of where their finances and career is today and where it is headed tomorrow.

Whatever your financial situation, we do not shame, criticize, or sell. We enrich, educate and empower. We work only with medical colleagues at every stage of their financial journey [students, interns, residents, practitioners, mid-career and mature physicians], through big life personal changes to annual employment reviews, in order to help them understand, invest, and protect their money and lifestyle.

CITE: https://www.r2library.com/Resource

For example, the following are current issues of review need for each Fall and Winter:

Financial planning reviews: 401-k, insurance, budget plans, investing, debt and savings, etc
Assess, develop, and align financial retirement and estate planning goals
Risk Management: Malpractice, home, life, medical, auto and personal indemnity
Life Insurance Need Reviews: whole, universal and term
Business, operations, HR, employment negotiations and medical practice management
Annuity Need Reviews: Indexed and Fixed [Pros and Cons].

***

At Marcinko & Associates we discuss specific needs and answer specific questions. We educate and make personalized recommendations that you are free to use, incorporate or disregard. Referrals to trusted specialists and strategic alliance partners then occur if – and as – needed [pro re nata].

SPONSOR: http://www.CertifiedMedicalPlanner.org

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CAN: Doctor-Patient Intimacy be Electronic?

Posted on May 15, 2024 by Dr. David Edward Marcinko MBA

e Communication Tales from the Treatment Room

By Dr. David Edward Marcinko MBA MEd CMP®

www.CertifiedMedicalPlanner.org

Today’s electronic media makes physician-patient communication possible; yet there is another kind of intimacy. ICTs—information and communication technologies—enable 24/7 monitoring of basic information such as blood pressure, glucose levels, pulse, and respiration, etc.

Example:

In one study, an ICT not only made it easier for patients to stay in touch with their doctors, the outcomes were also significantly better.[i] Today, Hippocrates is no longer trailing patients around the house to keep track of their snacks and moods. But Hippocrates has gone digital in the form of a wearable device that records subtle changes in biological markers and communicates them instantaneously to a health provider.

While this is obviously a great advance, we suggest you pause for a moment before plugging in.

Why?

ICTs and social media tools can make a difference to one of the most important dimensions—physiological outcomes. But you can have the latest interactive technology at your disposal and still fail to be connected.

Example:

A story that a friend told me shows how.

***

One morning, her elderly father was touching up the paint on his sailboat. Nearby, another boat-owner, who happened to be an emergency medical technician, noticed her father was struggling to breathe and that his lips had turned purple. A trip to the local community hospital led to a barrage of high-tech tests and procedures, a diagnosis of emphysema, later complications with cerebral hematomas, and hospitalizations and re-hospitalizations that brought him into contact with a neurologist, a neurosurgeon, a cardiologist, and a pulmonologist.

Throughout her father’s medical ordeal, the team of specialists stayed in touch with each other and the primary care physician via various electronic media. But one person remained out of the loop—her father. One day, six months into the experience, the primary care physician phoned our friend’s mother to check on his patient. Her father recalls thinking, “Why was he calling her?”

The physician was communicating, but he was emotionally disconnected.

***

The Moral

The moral of the story: communication needs to be patient-centered in both electronic and psychological terms. That means understanding how someone likes to communicate and making sure the medium fits the message. Electronic media are just part of the equation. The other is the doctor-patient relationship. Once a relationship is established, it may be fine to use e-mail to send information about dosage.

But, delivering a new diagnosis may require the extra effort of scheduling a phone call or a face-to-face visit. Today, since you have so many Health 2.0 choices, it takes some effort to select the right way to communicate in a particular situation.

Use the Right Relationship Strategy

A colleague recently shared another story about an encounter with a specialist.

Example:

***

After an examination for a minor ailment, he was told that there might be a medicated lotion that could ameliorate his condition. The doctor thought for a moment, then swiveled around to the computer on his desk. As our colleague watched the screen, his physician typed a few words into a search engine. Up popped a list and he wrote out a script. “Try this,” his doctor concluded. “I think it will help.”

It did, almost overnight.

***

The Moral

Even though his physical problem had disappeared completely, our colleague felt there was something missing in the interaction. “It bothered me that my doctor turned to the Web for help at that moment. He found a cure, but I felt he wasn’t paying attention to me.”

The physician is supposed to be an authority who has a special relationship to the patient. “Anybody can Google,” our colleague complained. Was he being unreasonable? Maybe.

But; this story tells us something important about technology—it cuts both ways.

***

Assessment

Everyone has their own preferences when it comes to how they want to interact with each other and with technology. If these preferences are explicit and aligned, the chances for a productive partnership are high. The preferences, however, are many and complex. You can easily get lost in the tangled thicket of interpersonal styles and virtual mediums.

In the Web 2.0 environment, it helps to narrow down the endless choices to just a few options.

MORE: Is Text Messaging being Overlooked as an Engagement Tool in Healthcare?

Conclusion

OUR OTHER PRINT BOOKS AND RELATED INFORMATION SOURCES:

HOSPITALS: http://www.crcpress.com/product/isbn/9781466558731
CLINICS: http://www.crcpress.com/product/isbn/9781439879900
ADVISORS: www.CertifiedMedicalPlanner.org
FINANCE: Financial Planning for Physicians and Advisors
INSURANCE: Risk Management and Insurance Strategies for Physicians and Advisors
Dictionary of Health Economics and Finance
Dictionary of Health Information Technology and Security
Dictionary of Health Insurance and Managed Care

[i] Hanson, William M. The Edge of Medicine: The Technology That Will Change Our Lives. New York, NY: Palgrave Macmillan, 2008.

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PODCAST: Hospital Price Transparency Website

Posted on May 15, 2024 by Dr. David Edward Marcinko MBA

BILLY EATS MEDICAL BILLS

By Eric Bricker MD

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Filed under: "Doctors Only", Accounting, Experts Invited, Funding Basics, Glossary Terms, Health Economics, Health Insurance, Health Law & Policy, Healthcare Finance, Insurance Matters, Interviews, Videos | Tagged: Billy, Eric Bricker JD, Hospital Price Transparency, hospital prices, hospital transparency | Leave a comment »

MEDICAL COACHING: Physician Burnout and Career Change

Posted on May 14, 2024 by Dr. David Edward Marcinko MBA

SPONSORED BY: http://www.MarcinkoAssociates.com

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Most doctors report feeling overworked and are considering a change in career, according to a new poll.

Doximity, a virtual network for physicians, found that 81% doctors surveyed last fall said they felt overworked—a slight decline from 86% who reported burnout in 2022 but still up from 73% in 2021. Meanwhile, about three in five doctors said they were considering early retirement (30%), looking for another employer (15%), or leaving the profession altogether (14%), the poll found.

The findings, released last year, come amid reports of rising rates of physician burnout and dissatisfaction since after the Covid-19 pandemic.

LEARN MORE: https://tinyurl.com/y3j2t3ab

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PHYSICIAN APPRAISAL ENGAGEMENTS: Investment Banking, FMV and Venture Capital

Posted on May 13, 2024 by Dr. David Edward Marcinko MBA

By Staff Reporters

SPONSOR: http://www.MARCINKOASSOCIATES.com

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There are a myriad of reasons for obtaining a Fair Market Value [FMV], Venture Capital [VC} and/or Investment Banking [IB] funding appraisal engagement:

Outright Selling-Buying
Partnership and Associate buy-in / buy-out
Mergers and Acquisitions
Organic growth tracking
Hospital integrations
Private and public reporting
Financing and Venture Capital
Estate and Tax Planning

And, there are many cautions, too. On July 19, 2023, the Federal Trade Commission (FTC) and the Department of Justice (DOJ) released a draft update of its Merger Guidelines, which guides the regulatory agencies in their review of both mergers and acquisitions in evaluating compliance with federal antitrust laws.

The new Guidelines replace, amend, and consolidate the Vertical Merger Guidelines and Horizontal Merger Guidelines, which were published in 2020 and 2010, respectively.

Our Value Analysis: https://marcinkoassociates.com/fmv-appraisals/

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PODCAST: “In-Elastic Demand” in Healthcare Economics

Posted on May 11, 2024 by Dr. David Edward Marcinko MBA

Economic Implications of Pain, Suffering and Imminent Death

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By Eric Bricker MD

Examples of Inelastic Demand in Healthcare Are:
1) Emergencies
2) Patented Medications for Diseases That Have No Other Alternative Drugs
3) Doctor Specialties Where the Patient Has No Choice in the Services Such As Radiologists, Anesthesiologists and Pathologists [RAP]

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PRISONER’S DILEMMA: In Health Economics

Posted on May 11, 2024 by Dr. David Edward Marcinko MBA

By Dr. David Edward Marcinko MBA MEd CMP

Understanding the Prisoner’s Dilemma

[From Wikipedia, the free encyclopedia]

As all economists and psychologists know, the prisoner’s dilemma is a standard example of a game analyzed in game theory that shows why two completely “rational” individuals might not cooperate, even if it appears that it is in their best interests to do so. It was originally framed by Merrill Flood and Melvin Dresher working at RAND in 1950. Albert W. Tucker formalized the game with prison sentence rewards and named it, “prisoner’s dilemma” (Poundstone, 1992), presenting it as follows:

Two members of a criminal gang are arrested and imprisoned. Each prisoner is in solitary confinement with no means of communicating with the other. The prosecutors lack sufficient evidence to convict the pair on the principal charge. They hope to get both sentenced to a year in prison on a lesser charge.

Simultaneously, the prosecutors offer each prisoner a bargain. Each prisoner is given the opportunity either to: betray the other by testifying that the other committed the crime, or to cooperate with the other by remaining silent.

The offer is:

If A and B each betray the other, each of them serves 2 years in prison
If A betrays B but B remains silent, A will be set free and B will serve 3 years in prison (and vice versa)
If A and B both remain silent, both of them will only serve 1 year in prison (on the lesser charge)

It is implied that the prisoners will have no opportunity to reward or punish their partner other than the prison sentences they get, and that their decision will not affect their reputation in the future. Because betraying a partner offers a greater reward than cooperating with him, all purely rational self-interested prisoners would betray the other, and so the only possible outcome for two purely rational prisoners is for them to betray each other.

***

The interesting part of this result is that pursuing individual reward logically leads both of the prisoners to betray, when they would get a better reward if they both kept silent.

In reality, humans display a systemic bias towards cooperative behavior in this and similar games, much more so than predicted by simple models of “rational” self-interested action. A model based on a different kind of rationality, where people forecast how the game would be played if they formed coalitions and then they maximize their forecasts, has been shown to make better predictions of the rate of cooperation in this and similar games given only the payoffs of the game.

An extended “iterated” version of the game also exists, where the classic game is played repeatedly between the same prisoners, and consequently, both prisoners continuously have an opportunity to penalize the other for previous decisions. If the number of times the game will be played is known to the players, then (by backward induction) two classically rational players will betray each other repeatedly, for the same reasons as the single shot variant. In an infinite or unknown length game there is no fixed optimum strategy, and Prisoner’s Dilemma tournaments have been held to compete and test algorithms.

In Health Economics

Advertising is sometimes cited as a real-example of the prisoner’s dilemma.

When cigarette advertising was legal in the United States, competing cigarette manufacturers had to decide how much money to spend on advertising. The effectiveness of Firm A’s advertising was partially determined by the advertising conducted by Firm B. Likewise, the profit derived from advertising for Firm B is affected by the advertising conducted by Firm A. If both Firm A and Firm B chose to advertise during a given period, then the advertising cancels out, receipts remain constant, and expenses increase due to the cost of advertising. Both firms would benefit from a reduction in advertising.

***

However, should Firm B choose not to advertise, Firm A could benefit greatly by advertising. Nevertheless, the optimal amount of advertising by one firm depends on how much advertising the other undertakes. As the best strategy is dependent on what the other firm chooses there is no dominant strategy, which makes it slightly different from a prisoner’s dilemma. The outcome is similar, though, in that both firms would be better off were they to advertise less than in the equilibrium. Sometimes cooperative behaviors do emerge in business situations.

For instance, cigarette manufacturers endorsed the making of laws banning cigarette advertising, understanding that this would reduce costs and increase profits across the industry. This analysis is likely to be pertinent in many other business situations involving advertising

Without enforceable agreements, members of a cartel are also involved in a (multi-player) prisoners’ dilemma. ‘Cooperating’ typically means keeping prices at a pre-agreed minimum level. ‘Defecting’ means selling under this minimum level, instantly taking business (and profits) from other cartel members. Anti-trust authorities want potential cartel members to mutually defect, ensuring the lowest possible prices for consumers.

More Healthcare Examples:

Assessment

The prisoner’s dilemma game can be used as a model for many real world situations involving cooperative behavior. In casual usage, the label “prisoner’s dilemma” may be applied to situations not strictly matching the formal criteria of the classic or iterative games: for instance, those in which two entities could gain important benefits from cooperating or suffer from the failure to do so, but find it merely difficult or expensive, not necessarily impossible, to coordinate their activities to achieve cooperation.

Conclusion

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OUR OTHER PRINT BOOKS AND RELATED INFORMATION SOURCES:

HOSPITALS: http://www.crcpress.com/product/isbn/9781466558731
CLINICS: http://www.crcpress.com/product/isbn/9781439879900
ADVISORS: www.CertifiedMedicalPlanner.org
FINANCE: Financial Planning for Physicians and Advisors
INSURANCE: Risk Management and Insurance Strategies for Physicians and Advisors
Dictionary of Health Economics and Finance
Dictionary of Health Information Technology and Security
Dictionary of Health Insurance and Managed Care

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PODCAST: History Applied to Health Economics

Posted on May 11, 2024 by Dr. David Edward Marcinko MBA

Divining the Future?

By Eric Bricker MD

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CITE: https://www.r2library.com/Resource/Title/0826102549

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Filed under: "Doctors Only", Book Reviews, Career Development, Ethics, Experts Invited, Health Economics, Health Insurance, Healthcare Finance, Quality Initiatives, Videos | Tagged: Eric Bricker MD, Health Economics, healthcare economics, healthcare history, healthcare trusts, history health economics | Leave a comment »

PODCAST: BUDGET MISTAKES: Kill Employee Health Plans

Posted on May 10, 2024 by Dr. David Edward Marcinko MBA

By Eric Bricker MD

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BUDGETING: For Physicians

Posted on May 10, 2024 by Dr. David Edward Marcinko MBA

Personal Physician Budgeting Thoughts

http://www.MARCINKOASSOCIATES.com

BY DR. DAVID E. MARCINKO MBA CMP®

SPONSOR: http://www.CertifiedMedicalPlanner.org

CITE: https://www.r2library.com/Resource/Title/082610254

Although some doctors might view a budget as unnecessarily restrictive, sticking to a spending plan can be a useful tool in enhancing the wealth of a practice. And so, I will emphasize keys to smart budgeting and how to track spending and savings in these tough economic times; like today with the stock market busts, venture capitalists invading health care, corona virus the pandemic, aging baby boomer physicians and the great resignation; etc.

There is an aphorism that suggests, “Money cannot buy happiness.” Well, this may be true enough but there is also a corollary that states, “Having a little money can sure reduces the unhappiness.”

Unfortunately, today there is still more than a little financial unhappiness in all medical specialties. The challenges range from the commoditization of medicine, aging demographics, Medicare reimbursement cutbacks, ACA, and increased competition to floundering equity markets, the squeeze on credit and declines in the value of a practice. Few doctors seem immune to this “perfect storm” of economic woes. And then Covid-19, corona, and covid.

Far too many physicians are hurting and it is not limited to above-average earning professionals. However, one can strive to reduce the pain by following some basic budgeting principles. By adhering to these principles, physicians can eliminate the “too many days at the end of the month” syndrome and instead develop a foundation for building real wealth and security, even in difficult economic climates like we face today.

There are three major budget types. A flexible budget is an expenditure cap that adjusts for changes in the volume of expense items. A fixed budget does not. Advancing to the next level of rigor, a zero-based budget starts with essential expenses and adds items until the money is gone. Regardless of type, budgets can be extremely effective if one uses them at home or the office in order to spot money troubles before they develop.

For the purpose of wealth building, doctors may think of this budget as a quantitative expression of an action plan. It is an integral part of the overall cost-control process for the individual, his or her family unit or one’s medical practice.1

How To Prepare A Personal Cash Flow Budget

Preparing a net income statement (lifestyle cash flow budget) is often difficult because many doctors perceive it as punitive. Most doctors do not live a disciplined spending lifestyle and they view a budget as a compromise to it. However, a cash flow budget is designed to provide comfort when there is surplus income that can be diverted for other future needs. For example, if you treat retirement savings as just another periodic bill, you are more likely to save for it.

You may construct a personal cash budget by recording each cash receipt and cash disbursement on a spreadsheet. Only the date, amount and a brief description of the transaction are necessary. The cash budget is a simple tool that even doctors who lack accounting acumen can use. Since it is possible to track the cash-in and cash-out in the same format used for a standard check register, most doctors find that the process takes very little time. Such a budget will provide a helpful look at how well you are staying within available resources for a given period.

We then continue with an analysis of your operating checkbook and a review of various source documents such as one’s tax return, credit card statements, pay stubs and insurance policies. A typical statement will show all cash transactions that occur within one year. It is helpful to establish a monthly equivalent to all items of income and expense. For the purposes of getting started, note items of income and expense by the frequency you are accustomed to receiving or spending them.

What You Should Know About The ‘Action Plan’ Cash Budget

For a medial office, the first operations budget item might be salary for the doctor and staff. Operating assets and other big ticket items come next. Some doctors/clients review their office P&L statements monthly, line by line, in an effort to reduce expenses. Then they add back those discretionary business expenses they have some control over.

Now, do you still run out of money before the end of the month? If so, you had better cut back on entertainment, eating dinner out or that fancy, new but unproven piece of medical equipment. This sounds draconian until you remind yourself that your choice is either: live frugally later or live a simpler lifestyle now and invest the difference.

As a young doctor, it may be a difficult trade-off. By mid-life, however, you are staring retirement in the face. That is why the action plan depends on your actions concerning monetary scarcity, a plan that one can implement and measure using simple benchmarks or budgeting ratios. By using these statistics, perhaps on an annual basis, the podiatrist can spot problems, correct them and continue planning actively toward stated goals like building long-term wealth.2

Useful Calculations To Assess Your Budgeting Success

In the past, generic budgeting ratios would emphasize not spending more than 15 to 20 percent of your net salary on food or 8 percent on medical care. Now these estimates have given way to more rigorous numbers. Personal budget ratios, much like medical practice financial ratios, represent comparable benchmarks for parameters such as debt, income growth and net worth. Although these ratios are still broad, the following represent some useful personal budgeting ratios for physicians.

• Basic liquidity ratio = liquid assets / average monthly expenses. Cash-on-hand should approach 12 to 24 months or more in the case of a doctor employed by a financially insecure HMO or fragile medical group practice. Yes, chances are you have heard of the standard notion of setting enough cash aside to cover three months in a rainy day scenario. However, we have decried this older laymen standard for many years in our textbooks, white papers and speaking engagements as being wholly insufficient for the competitively unstable environment of modern healthcare.

• Debt to assets ratio = total debt / total assets. This percentage is high initially but should decrease with age as the doctor approaches a debt-free existence

• Debt to gross income ratio = annual debt repayments / annual gross income. This represents the adequacy of current income for existing debt repayments. Doctors should try to keep this below 20 to 25 percent.

• Debt service ratio = annual debt repayment / annual take-home pay. Physicians should aim to keep this ratio below 25 to 30 percent or face difficulty paying down debt.

• Investment assets to net worth ratio = investment assets / net worth. This budget ratio should increase over time as retirement approaches.

• Savings to income ratio = savings / annual income. This ratio should also increase over time as one retires major obligations like medical school debt, a practice loan or a home mortgage.

• Real growth ratio = (income this year – income last year) / (income last year – inflation rate). This budget ratio should grow faster than the core rate of inflation.

• Growth of net worth ratio = (net worth this year – net worth last year) / net worth last year – inflation rate). Again, this budgeting ratio should stay ahead of the specter of rising inflation.

In other words, these ratios will help answer the question: “How am I doing?”

Pearls For Sticking To A Budget

Far from the burden that most doctors consider it to be, budgeting in one form or another is probably one of the greatest tools for building wealth. However, it is also one of the greatest weaknesses among physicians who tend to live a certain lifestyle.3

In fact, I have found that less than one in 10 medical professionals have a personal budget. Fear, or a lack of knowledge, is a major cause of procrastination. Fortunately, the following guidelines assist in reversing this microeconomic disaster.

1. Set reasonable goals and estimate annual income. Do not keep large amounts of cash at home or office. Deposit it in an FDIC insured money-market account for safety. Do not deposit it in a money market mutual fund with net asset value (NAV) that may “break the buck” and fall below the one-dollar level. The new limit is $250,000. Track actual bills and expenses.

2. Do not pay bills early, do not have more taxes withheld from your salary than needed and develop spending estimates to pay fixed expenses first. Fixed expenses are usually contractual and usually include housing, utilities, food, Social Security, medical, debt repayments, homeowner’s or renter’s insurance, auto, life and disability insurance, etc. Reduce fixed expenses when possible. Ultimately, all expenses get paid and become variable in the long run.

3. Make it a priority to reduce variable expenses. Variable expenses are not contractual and may include clothing, education, recreational, travel, vacation, gas, cable TV, entertainment, gifts, furnishings, savings, investments, etc. Trim variable expenses by 5 to 20 percent.

4. Use “carve-outs or “set-asides” for big ticket items and differentiate true wants from frivolous needs.

5. Calculate both income and expenses as a percentage of your total budget. Determine if there is a better way to allocate resources. Review the budget on a monthly basis to notice any variance. Determine if the variance was avoidable, unavoidable or a result of inaccurate assumptions. Take corrective action as needed.

6. Know the difference between saving and investing. Savers tend to be risk adverse while investors understand risk and take steps to mitigate it. Watch mutual fund commissions and investment advisory fees, which cut into return-rates. Keep investments simple and diversified (stocks, bonds, cash, index, no-load mutual and exchange traded funds, etc.).4

How To Budget In The Midst Of A [Corona] Crisis

Sooner or later, despite the best of budgeting intentions, something will go awry. A doctor will be terminated or may be the victim of a reduction-in-force (RIF) because of cost containment initiatives of the corona pandemic. A medical practice partnership may dissolve or a local hospital or surgery center may close, hurting your practice and livelihood. Someone may file a malpractice lawsuit against you, a working spouse may be laid off or you may get divorced. Regardless of the cause, budgeting crisis management encompasses two different perspectives: awareness and execution.

First, if you become aware that you may lose your job, the following proactive steps will be helpful to your budget and overall financial condition.

   • Decrease retirement contributions to the required minimum for company/practice match.
   • Place retirement contribution differences in an after-tax emergency fund.
   • Eliminate unnecessary payroll deductions and deposit the difference to cash.
   • Replace group term life insurance with personal term or universal life insurance.
   • Take your old group term life insurance policy with you if possible.
   • Establish a home equity line of credit to verify employment.
   • Borrow against your pension plan only as a last resort.

If you have lost your job or your salary has been depressed, negotiate your departure and get an attorney if you believe you lost your position through breach of contract or discrimination. Then execute the following steps to recalculate your budget and boost your wealth rebuilding activities.

• Prioritize fixed monthly bills in the following order: rent or mortgage; car payments; utility bills; minimum credit card payments; and restructured long-term debt.

• Consider liquidating assets to pay off debts in this order: emergency fund, checking accounts, investment accounts or assets held in your children’s names.

• Review insurance coverage and increase deductibles on homeowner’s and automobile insurance for needed cash.

• Then sell appreciated stocks or mutual funds; personal valuables such as furnishings, jewelry and real estate; and finally, assets not in pension or annuities if necessary.

• Keep or rollover any lump sum pension or savings plan distribution directly to a similar savings plan at your new employer, if possible, when you get rehired.

• Apply for unemployment insurance.

• Review your medical insurance and COBRA coverage after a “qualifying event” such as job loss, firing or even after quitting. It is a bit expensive due to a 2 percent administrative fee surcharge but this may be well worth it for those with preexisting conditions or who are otherwise difficult to insure. One may continue COBRA for up to 18 months.

• Consider a high deductible Health Savings Account (HSA), which allows tax-deferred dollars like a medical IRA, for a variety of costs not normally covered under traditional heath insurance plans. Self-employed doctors deduct both the cost of the premiums and the amount contributed to the HSA. Unused funds roll over until the age of 59½, when one can use the money as a supplemental retirement benefit.

• Eliminate unnecessary variable, charitable and/or discretionary expenses, and become very frugal.

Final Notes

The behavioral psychologist, Gene Schmuckler, PhD, MBA, sometimes asks exasperated doctors to recall the story of the old man who spent a day watching his physician son treating HMO patients in the office. The doctor had been working at his usual feverish pace all morning. Although he was working hard, he bitterly complained to his dad that he was not making as much money as he used to make. Finally, the old man interrupted him and said, “Son, why don’t you just treat the sick patients?” The doctor-son looked at his father with an annoyed expression and responded, “Dad, can’t you see, I do not have time to treat just the sick ones.”5

Always remember to add a bit of emotional sanity into your budgeting and economic endeavors.6

Regardless of one’s age or lifestyle, the insightful doctor realizes that it is never too late to take control of a lost financial destiny through prudent wealth building activities. Personal and practice budgeting is always a good way to start the journey.7

The Author:

Dr. Marcinko is a former university endowed chairman and professor, former certified financial planner and has been a medical management advisor for more than two decades. He is the CEO of www.MedicalBusinessAdvisors.com, a health economics and business finance consulting firm.

References:

1. Marcinko DE (Ed). The Business of Medical Practice (Advanced Profit Maximizing Techniques for Savvy Doctors). Springer Publishers, New York, NY, 2000 and 2004 2. Marcinko DE (Ed). Financial Planning for Physicians and Advisors, Jones and Bartlett Publishers, Sudbury, MA, 2005 3. Marcinko DE (Ed). Risk Management and Insurance Panning for Physicians and Advisors, Jones and Bartlett Publishers, Sudbury, MA, 2006. 4. Marcinko DE, Hetico HR. The Dictionary of Health Insurance and Managed Care. Springer Publishing, New York, 2007. 5. Marcinko DE, Hetico HR. The Dictionary of Health Economics and Finance. Springer Publishing, New York, 2008. 6. Marcinko DE, Hetico HR. Healthcare Organizations (Financial Management Strategies). Standard Technical Publishers, Blaine, WA, 2009. Additional Reference 7. Schmuckler E. Bridging Financial Planning and Human and Human Psychology. In, Marcinko DE (Ed): Financial Planning for Physicians and Healthcare Professionals. Aspen Publications, New York, NY, 2001, 2002 and 2003.

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PODCAST: Accounting for Healthcare Professionals

Posted on May 9, 2024 by Dr. David Edward Marcinko MBA

By Eric Bricker MD

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PODCAST: Accounting Deception in Health Care

Posted on May 9, 2024 by Dr. David Edward Marcinko MBA

Examples of Exploitation and Deception?

BY ERIC BRICKER MD

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TERMS: https://medicalexecutivepost.com/2021/11/02/financial-terms-and-definitions-all-physician-should-know/

Triple Entry Accounting: https://medicalexecutivepost.com/2020/12/28/triple-entry-accounting/

HEALTH ECONOMICS CITE: https://www.r2library.com/Resource/Title/0826102549

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https://www.amazon.com/Business-Medical-Practice-Transformational-Doctors/dp/0826105750/ref=sr_1_9?s=books&ie=UTF8&qid=1287563112&sr=1-9

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https://www.amazon.com/Dictionary-Health-Insurance-Managed-Care/dp/0826149944/ref=sr_1_4?ie=UTF8&s=books&qid=1275315485&sr=1-4

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PODCAST: Secret to Primary Care Profitability

Posted on May 8, 2024 by Dr. David Edward Marcinko MBA

By Eric Bricker MD

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OPEN LETTER: MARCINKO Associates, Inc.

Posted on May 7, 2024 by Dr. David Edward Marcinko MBA

MISSION STATEMENT

Open Letter from the CEO

Dr. David Edward Marcinko MBA CMP™

http://www.MarcinkoAssociates.com

ALL MEDICAL AND HEALTHCARE COLLEAGUES

Did you know that at MARCINKO & Associates, all medical colleagues throughout the United States may contact us when they are considering the sale, purchase, strategic operating improvement, merger, acquisition and/or other financial business or related personal financial planning transaction?

MORE: https://marcinkoassociates.com/welcome-medical-colleagues/

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Our difference is “hard” knowledge and insider financial guidance that helps medical colleagues, nurses, private practitioners, clinics, ambulatory surgery, radiology and outpatient wound care centers realize their ultimate economic goals. This typically includes managerial and cost accounting, financial ratio analysis, fair market valuation business appraisals, business plan creation and personal financial planning.

MORE: https://marcinkoassociates.com/fmv-appraisals/

Our “expert witness” business litigation support service and divorce mediation, arbitration, asset division, settlement and second opinion offerings are always available, as well.

MORE: https://marcinkoassociates.com/expert-witness/

And, our “soft” skill professional career guidance and mentoring center includes executive coaching, consulting and mentoring advisory programs for stressed, conflicted or burned-out physicians and medical practitioners.

COACHING: Careers

Most importantly, our professional fees are reasonable and always transparent.

MARCINKO & Associates also serves universities, medical, business, graduate and nursing schools; physicians, dentists, podiatrists, optometrists and legal societies. This includes accountants, financial service providers, wealth and hedge fund managers, emerging entities, hospitals, CEOs and their BODs, the press, media and related organizations.

MORE: https://marcinkoassociates.com/speaking-seminars/

Contact us for an educational white-paper on most any topic.

MORE: https://marcinkoassociates.com/case-studies/

***

Now, please review our website to learn more.

And, always retain us when needed.

How May We Serve You?

DAVID EDWARD MARCINKO

email: MarcinkoAdvisors@msn.com

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FINANCIAL AND HEALTH ECONOMICS BENCH MARKING

Posted on May 7, 2024 by Dr. David Edward Marcinko MBA

Understanding the operational and financial status of your organization or practice

[By Dr. David Edward Marcinko MBA MEd CMP™]

SPONSOR: http://www.MarcinkoAssociates.com

Financial benchmarking can assist healthcare managers and professional financial advisors in understanding the operational and financial status of their organization or practice.

The general process of financial benchmarking analysis may include three elements: (1) Historical subject benchmarking; (2) Benchmarking to industry norms; and, (3) Financial ratio analysis.

History

Historical subject benchmarking compares a healthcare organization’s most recent performance with its reported performance in the past in order to: examine performance over time; identify changes in performance within the organization (e.g., extraordinary and non-recurring events); and, to predict future performance.

As a form of internal benchmarking, historical subject benchmarking avoids issues such as: differences in data collection and use of measurement tools; and, benchmarking metrics that often cause problems in comparing two different organizations.

However, it is necessary to common size data in order to account for company differences over time that may skew results.

Benchmarking

Benchmarking to industry norms, analogous to Fong and colleagues’ concept of industry benchmarking, involves comparing internal company-specific data to survey data from other organizations within the same industry. This method of benchmarking provides the basis for comparing the subject entity to similar entities, with the purpose of identifying its relative strengths, weaknesses, and related measures of risk.

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Financial Ratio Analysis

The process of benchmarking against industry averages or norms will typically involve the following steps:

Identification and selection of appropriate surveys to use as a benchmark, i.e., to compare with data from the organization of interest. This involves answering the question, “In which survey would this organization most likely be included?”;
If appropriate, re-categorization and adjustment of the organization’s revenue and expense accounts to optimize data compatibility with the selected survey’s structure and definitions (e.g., common sizing); and,
Calculation and articulation of observed differences of organization from the industry averages and norms, expressed either in terms of variance in ratio, dollar unit amounts, or percentages of variation.

Trends

Financial ratio analysis typically involves the calculation of ratios that are financial and operational measures representative of the financial status of an enterprise. These ratios are evaluated in terms of their relative comparison to generally established industry norms, which may be expressed as positive or negative trends for that industry sector. The ratios selected may function as several different measures of operating performance or financial condition of the subject entity.

The Selected Ratios

Common types of financial indicators that are measured by ratio analysis include:

Liquidity. Liquidity ratios measure the ability of an organization to meet cash obligations as they become due, i.e., to support operational goals. Ratios above the industry mean generally indicate that the organization is in an advantageous position to better support immediate goals. The current ratio, which quantifies the relationship between assets and liabilities, is an indicator of an organization’s ability to meet short-term obligations. Managers use this measure to determine how quickly assets are converted into cash.
Activity. Activity ratios, also called efficiency ratios, indicate how efficiently the organization utilizes its resources or assets, including cash, accounts receivable, salaries, inventory, property, plant, and equipment. Lower ratios may indicate an inefficient use of those assets.
Leverage. Leverage ratios, measured as the ratio of long-term debt to net fixed assets, are used to illustrate the proportion of funds, or capital, provided by shareholders (owners) and creditors to aid analysts in assessing the appropriateness of an organization’s current level of debt. When this ratio falls equal to or below the industry norm, the organization is typically not considered to be at significant risk.
Profitability. Indicates the overall net effect of managerial efficiency of the enterprise. To determine the profitability of the enterprise for benchmarking purposes, the analyst should first review and make adjustments to the owner(s) compensation, if appropriate. Adjustments for the market value of the “replacement cost” of the professional services provided by the owner are particularly important in the valuation of professional medical practices for the purpose of arriving at an ”economic level” of profit.

Data Homogeneity

The selection of financial ratios for analysis and comparison to the organization’s performance requires careful attention to the homogeneity of data. Benchmarking of intra-organizational data (i.e., internal benchmarking) typically proves to be less variable across several different measurement periods.

However, the use of data from external facilities for comparison may introduce variation in measurement methodology and procedure. In the latter case, use of a standard chart of accounts for the organization or recasting the organization’s data to a standard format can effectively facilitate an appropriate comparison of the organization’s operating performance and financial status data to survey results.

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BOOK: Comprehensive Financial Planning Strategies for Doctors and Advisors: Best Practices from Leading Consultants and Certified Medical Planners™

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Operational Performance Benchmarking

Operational benchmarking is used to target non-central work or business processes for improvement. It is conceptually similar to both process and performance benchmarking, but is generally classified by the application of the results, as opposed to what is being compared. Operational benchmarking studies tend to be smaller in scope than other types of benchmarking, but, like many other types of benchmarking, are limited by the degree to which the definitions and performance measures used by comparing entities differ. Common sizing is a technique used to reduce the variations in measures caused by differences (e.g., definition issues) between the organizations or processes being compared.

Common Sizing

Common sizing is a technique used to alter financial operating data prior to certain types of benchmarking analysis and may be useful for any type of benchmarking that requires the comparison of entities that differ on some level (e.g., scope of respective benchmarking measurements, definitions, business processes). This is done by expressing the data for differing entities in relative (i.e., comparable) terms.

Example:

For example, common sizing is often used to compare financial statements of the same company over different periods of time (e.g., historical subject benchmarking), or of several companies of differing sizes (e.g., benchmarking to industry norms). The latter type may be used for benchmarking an organization to another in its industry, to industry averages, or to the best performing agency in its industry. Some examples of common size measures utilized in healthcare include:

Percent of revenue or per unit produced, e.g., relative value unit (RVU);
Per provider, e.g., physician;
Per capacity measurement, e.g., per square foot; or,
Other standard units of comparison.

Assessment

As with any data, differences in how data is collected, stored, and analyzed over time or between different organizations may complicate the use of it at a later time. Accordingly, appropriate adjustments must be made to account for such differences and provide an accurate and reliable dataset for benchmarking.

Conclusion

OUR OTHER PRINT BOOKS AND RELATED INFORMATION SOURCES:

HOSPITALS: http://www.crcpress.com/product/isbn/9781466558731
CLINICS: http://www.crcpress.com/product/isbn/9781439879900
ADVISORS: www.CertifiedMedicalPlanner.org
BLOG: www.MedicalExecutivePost.com
FINANCE: Financial Planning for Physicians and Advisors
INSURANCE: Risk Management and Insurance Strategies for Physicians and Advisors

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PODCAST: “Payvider” Health Insurance Payer and Providers Combined

Posted on May 7, 2024 by Dr. David Edward Marcinko MBA

By Eric Bricker MD

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PODCAST: Cost of Healthcare Bureaucracy

Posted on May 6, 2024 by Dr. David Edward Marcinko MBA

By Eric Bricker MD

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Filed under: "Doctors Only", Career Development, Experts Invited, Glossary Terms, Health Economics, Health Insurance, Health Law & Policy, Op-Editorials, Videos | Tagged: cost bureaucracy, Eric Bricker MD, Healthcare bureaucracy, hospital bureaucracy, hospital costs | Leave a comment »

PODCAST: Doctor Hospital Co-Owned Ambulatory Surgery Centers (ASC)

Posted on May 6, 2024 by Dr. David Edward Marcinko MBA

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By Eric Bricker MD

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MORE: https://www.youtube.com/watch?v=EuzjQcsim20

CITE: https://www.r2library.com/Resource/Title/082610254

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PODCASTS: Hospital Posts Laboratory Prices to Physician EMRs

Posted on May 5, 2024 by Dr. David Edward Marcinko MBA

Doctors Order Less Laboratory Tests

By Eric Bricker MD

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FDA: Regulation of Laboratory Tests

Posted on May 5, 2024 by Dr. David Edward Marcinko MBA

By Staff Reporters

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The Food and Drug Administration wants to make sure that if someone is analyzing your blood and urine, it’s worth your time, so the agency just finalized regulations to govern the $10 billion lab test industry. Tests designed by laboratories have long gone without government scrutiny, but the FDA said the time has come to ensure these tests are accurate—though the new standards will be phased in over several years.

There are currently about 80,000 medical tests available from ~1,200 labs, per the FDA, and those will mostly be grandfathered in. Still, the industry has pushed back, saying the regulations will inhibit innovation, and could sue to block the rules from taking effect.

CITE: https://www.r2library.com/Resource

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PODCAST: “All OR Nothing” Hospital Contracts

Posted on May 4, 2024 by Dr. David Edward Marcinko MBA

By Eric Bricker MD

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CITE: https://www.r2library.com/Resource/Title/082610254

ORDER: https://www.amazon.com/Dictionary-Health-Insurance-Managed-Care/dp/0826149944/ref=sr_1_4?ie=UTF8&s=books&qid=1275315485&sr=1-4

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FTC: Finalizes Ban on Non-Compete Agreements

Posted on May 4, 2024 by Dr. David Edward Marcinko MBA

By Health Capital Consultants LLC

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On April 23rd, 2024, the Federal Trade Commission (FTC) issued a final rule that would ban employers from imposing non-competes on their employees. The FTC asserts that this exploitative practice keeps wages low, and suppresses new ideas. Notably, while the final rule will affect all industries, not just healthcare, this proposal comes at a time when healthcare employers across the U.S. are struggling with staffing shortages.

Existing noncompetes for the majority of workers will no longer be enforceable after the rule goes into effect (i.e., 120 days after publication in the Federal Register); however, the FTC ban appears likely to face a legal challenge, and it could be years before it can take effect.

Under the final rule, noncompetes for senior executives can remain in force under the new ruling, but employers may not enter in or attempt to enforce any new noncompetes, even if that includes a senior executive. The Commission also recognizes that they have no jurisdiction over not-for-profit entities, however they reserve the right to evaluate any entity’s non-profit status. The FTC specifically stated that “some portion of the 58% of hospitals that claim tax-exempt status as nonprofits and the 19% of hospitals that are identified as State or local government hospitals in the data cited by AHA likely fall under the Commission’s jurisdiction and the final rule’s purview.”

While most healthcare employees and workers, including physicians, believe that the ruling is long overdue and that noncompetes “impede patient access to care, limit physicians’ ability to choose their employer, contribute to burnout and stifle competition,” the American Hospital Association (AHA), stated that the “FTC’s final rule banning non-compete agreements for all employees across all sectors of the economy is bad law, bad policy, and a clear sign of an agency run amok.

Look for next month’s (May 2024) Health Capital Topics article that will discuss, in more detail, the final rule, reactions from healthcare industry stakeholders, and potential implications for healthcare valuations (both business and compensation valuations).

MORE: (Read the FTC’s Press Release Here)

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ENDING MEDICARE ADVANTAGE: Humana Dis-advantage

Posted on May 3, 2024 by Dr. David Edward Marcinko MBA

By Staff Reporters

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Millions of Americans on Humana’s Medicare Advantage plans could see their health care benefits cut after the company makes major profit-boosting adjustments to its plans.

Humana said it would be ending some plans and cutting benefits for patients in 2025 as it hopes to boost its financial performance. Altogether, 6 million Americans are insured through Humana’s Medicare Advantage.

CITE: https://www.r2library.com/Resource/Title/082610254

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Filed under: "Ask-an-Advisor", "Doctors Only", Drugs and Pharma, Ethics, Health Economics, Health Insurance, Health Law & Policy, Healthcare Finance | Tagged: Humana, Humana cuts, Humana Medicare Advantage, Humana Part C cuts, Medicare Advantage, Part C | Leave a comment »

What is Hospital WACC?

Posted on May 2, 2024 by Dr. David Edward Marcinko MBA

By Calvin Weise CPA and Dr. David E. Marcinko MBA MEd CMP

SPONSOR: http://www.CertifiedMedicalPlanner.org

The Weighted Average Cost of Capital

It is critical to understand and to measure the total cost of capital. Lack of understanding and appreciation of the total cost of capital is widespread, particularly among not-for-profit hospital executives. The capital structure includes long-term debt and equity; total capital is the sum of these two. Each of these components has cost associated with it. For the long-term debt portion, this cost is explicit: it is the interest rate plus associated costs of placement and servicing.

Equity portion

For the equity portion, the cost is not explicit and is widely misunderstood. In many cases, hospital capital structures include significant amounts of equity that has accumulated over many years of favorable operations. Too many executives wrongly attribute zero cost to the equity portion of their capital structure. Although it is correct that generally accepted accounting principles continue to assign a zero cost to equity, there is opportunity cost associated with equity that needs to be considered. This cost is the opportunity available to utilize that capital in alternative ways.

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In general, the cost attributed to equity is the return expected by the equity markets on hospital equity. This can be observed by evaluating the equity prices of hospital companies whose equity is traded on public stock exchanges. Usually the equity prices will imply cost of equity in the range of 10% to 14%.

Almost always, the cost of equity implied by hospital equity prices traded on public stock exchanges will substantially exceed the cost of long-term debt. Thus, while many hospital executives will view the cost of equity to be substantially less than the cost of debt (i.e., to be zero), in nearly all cases, the appropriate cost of equity will be substantially greater than the cost of debt.

http://www.HealthDictionarySeries.org

Hospitals need to measure their weighted average cost of capital (WACC).

WACC is the cost of long-term debt multiplied by the ratio of long-term debt to total capital plus the cost of equity multiplied by the ratio of equity to total capital (where total capital is the sum of long-term debt and equity).

WACC is then used as the basis for capital charges associated with all capital investments. Capital investments should be expected to generate positive returns after applying this capital charge based on the WACC. Capital investments that don’t generate returns exceeding the WACC consume enterprise value; those that generate returns exceeding WACC increase enterprise value.

Assessment

Hospital executives need to be rewarded for increasing enterprise value.

Conclusion

OUR OTHER PRINT BOOKS AND RELATED INFORMATION SOURCES:

HOSPITALS: http://www.crcpress.com/product/isbn/9781466558731
CLINICS: http://www.crcpress.com/product/isbn/9781439879900
ADVISORS: www.CertifiedMedicalPlanner.org
FINANCE: Financial Planning for Physicians and Advisors
INSURANCE: Risk Management and Insurance Strategies for Physicians and Advisors
Dictionary of Health Economics and Finance
Dictionary of Health Information Technology and Security
Dictionary of Health Insurance and Managed Care

***

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PODCAST: Medicare Advantage [Part C] Fraud?

Posted on May 2, 2024 by Dr. David Edward Marcinko MBA

By Eric Bricker MD

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Filed under: "Doctors Only", Career Development, Ethics, Experts Invited, Health Economics, Health Insurance, Health Law & Policy, Risk Management, Videos | Tagged: Eric Bricker MD, Medicare Advantage, Medicare advantage fraud, Part C, Part C fraud | Leave a comment »

DOJ: Antitrust Reportedly Investigating UnitedHealth Group

Posted on May 2, 2024 by Dr. David Edward Marcinko MBA

By Health Capital Consultants, LLC

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On February 27, 2024, the Wall Street Journal (WSJ) reported that the Department of Justice (DOJ) has launched an antitrust investigation into UnitedHealth Group (UHG), the owner of the biggest health insurer in the U.S. and the leading manager of drug benefits and one of the largest networks of physician groups. This investigation comes as the Biden administration’s antitrust enforcers have ramped up investigations into some of the biggest U.S. companies, including Amazon, Apple, and Google.

CITE: https://www.r2library.com/Resource

This Health Capital Topics article reviews the reported government investigation. (Read more…)

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What is a Hospital CHARGE MASTER?

Posted on May 1, 2024 by Dr. David Edward Marcinko MBA

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By Dr. David Edward Marcinko MBA MEd CMP

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According to George Washington University, a hospital chargemaster is a comprehensive list of a hospital’s products, procedures, and services. Everything from prescription drugs to supplies for diagnostic tests has a unique price listing in the chargemaster, making it a go-to document for hospital administrators such as CFOs, clinical documentation improvement specialists, and revenue directors.

Chargemaster usage dates back to the mid-20th century. At that time, fee-for-service (FFS) health insurance plans, which allow patients to direct their medical care by choosing physicians and facilities and paying a portion of the billed total, had just emerged in the U.S. healthcare system.

The chargemaster originally served as something akin to an FFS dictionary, with an entry for virtually anything billable under that economic model of healthcare.

CITE: https://www.r2library.com/Resource/Title/082610254

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Over time, FFS itself has evolved and been challenged by alternatives like value-based care (VBC). Chargemasters built for FFS have changed accordingly, and they remain fixtures of the modern hospital revenue cycle. A standard chargemaster is a large electronic file containing multiple elements for each entry. These attributes usually include:

The charge for a single unit of the service in question
A Current Procedural Terminology (CPT) code; CPT is the official medical code set of the American Medical Association
Potentially, a Healthcare Common Practice Coding System (HCPCS) code; HCPCS is based on CPT
Alternative CPT and HCPCS codes if needed, e.g. one corresponding only to specific payers
A revenue code associated with the charge
Flag(s) indicating if the entry is scheduled for deletion, active or inactive
An internal reference number within the ledger for accounting purposes

LINK: https://revcycleintelligence.com/features/the-role-of-the-hospital-chargemaster-in-revenue-cycle-management

MORE: https://medicalexecutivepost.com/2013/09/26/some-modern-issues-impacting-hospital-revenue-cycles/

RCC: https://medicalexecutivepost.com/2013/03/06/a-better-approach-to-hospital-cost-estimation/

***

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FINANCE: https://www.amazon.com/Financial-Management-Strategies-Healthcare-Organizations/dp/1466558733/ref=sr_1_3?ie=UTF8&qid=1380743521&sr=8-3&keywords=david+marcinko

BUSINESS: https://www.amazon.com/Business-Medical-Practice-Transformational-Doctors/dp/0826105750/ref=sr_1_9?ie=UTF8&qid=1448163039&sr=8-9&keywords=david+marcinko

HEALTH INSURANCE: https://www.amazon.com/Dictionary-Health-Insurance-Managed-Care/dp/0826149944/ref=sr_1_4?ie=UTF8&s=books&qid=1275315485&sr=1-4

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PODCAST: Cash Flow, Revenue & Entrepreneurial Leadership in Healthcare Business

Posted on May 1, 2024 by Dr. David Edward Marcinko MBA

THE ENTREPRENEURIAL M.D.

In this episode we are joined by Dr. Brent Jackson, Chief Medical Officer for Mercy General in Sacramento, CA to discuss the physician life-cycle, burnout, and transitioning into leadership within healthcare.

Play EpisodeDownload (40.4 MB)

Summary: Dr Brent Jackson discusses the flow of revenue throughout the medical industry.

CITE: https://www.r2library.com/Resource/Title/0826102549

SECOND OPINIONS: https://medicalexecutivepost.com/schedule-a-consultation/

INVITE DR. MARCINKO: https://medicalexecutivepost.com/dr-david-marcinkos-bookings/

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PODCAST: Healthcare Revenue Cycle Management Explained

Posted on May 1, 2024 by Dr. David Edward Marcinko MBA

By Eric Bricker MD

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THE CARTOON: Shrink

Posted on April 30, 2024 by Dr. David Edward Marcinko MBA

Cartoons on Topics in Psychiatry and Medicine

http://www.TheCartoonShrink.com

By Staff Reporters

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Emily Watters, M.D. is an adult psychiatrist. She lives and practices in the bay area. She works in both community psychiatry and in private practice. She loves to teach, especially through sketches and comics.

Questions contribute to understanding and you are welcome to reach out to her at: thecartoonshrink@gmail.com

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MEDICARE PART C: Humana Used A.I. Tool from UnitedHealth to Deny Medicare Advantage Claims

Posted on April 30, 2024 by Dr. David Edward Marcinko MBA

LAWSUIT

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Humana Used AI Tool from UnitedHealth to Deny Medicare Advantage Claims

Humana used an artificial intelligence tool owned by UnitedHealth Group to wrongfully deny Medicare Advantage [Part C] members’ medical claims, according to a class-action complaint filed on Dec. 12th. The lawsuit was filed in the U.S. District Court for the Western District of Kentucky and is the latest legal action against major insurers such as UnitedHealthcare and Cigna for allegedly using automated data tools to wrongfully deny members’ claims.

The complaint against Humana, the country’s second-largest Medicare Advantage insurer, accuses the company of using an AI tool called nH Predict to determine how long a patient will need to remain in post-acute care and overrides physicians’ determinations for the patient. The plaintiffs claim Humana set a goal to keep post-acute facility stay lengths for MA members within 1% of nH Predict’s estimations. Employees who deviate from the algorithm’s estimates are “disciplined and terminated, regardless of whether a patient requires more care,” the lawsuit alleges. When decisions made by the algorithm are appealed, they are allegedly overturned 90% of the time.

Source: Jakob Emerson Becker’s Payer Issues [12/13/23]

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Filed under: "Doctors Only", Ethics, Experts Invited, Health Insurance, Health Law & Policy, Insurance Matters | Tagged: Becker's Payer Issues, c, Cigna, Humana, Jakob Emerson, MA, Medicare Advantage, nH Predict, Part C, uch, United Health Group, UnitedHealth | 1 Comment »

HUMANA: Exits Medicare Part C Plan Markets

Posted on April 30, 2024 by Dr. David Edward Marcinko MBA

By Staff Reporters

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Humana Plans to Leave Some Medicare Advantage Markets in 2025

Humana expects to exit Medicare Advantage (MA) markets in 2025, company executives told investors. The company reported its first quarter earnings April 24th. Humana posted $741 million in net income in the first quarter of 2024, beating investor expectations, but pulled its 2025 earnings guidance.

On an April 24th 2024 call with investors, Humana executives said it will look to pull back benefits and exit some markets, as CMS continues phasing in risk adjustment changes. CMS published its final MA rate notice for 2025 earlier this month. The agency slightly cut benchmark payments and continued phasing in coding changes. Humana previously said the agency’s rates were lower than its expectations.

Other payers have signaled they will likely cut benefits to accommodate the rate notice.

Source: Rylee Wilson, Becker’s Payer Issues [4/25/24]

CITE: https://www.r2library.com/Resource

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ORDER: https://www.amazon.com/Dictionary-Health-Insurance-Managed-Care/dp/0826149944/ref=sr_1_4?ie=UTF8&s=books&qid=1275315485&sr=1-4
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National Supply Chain Management Day: Health Care “White Paper”

Posted on April 29, 2024 by Dr. David Edward Marcinko MBA

By Staff Reporters

Dr. David Edward Marcinko MBA MEd CMP

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National Supply Chain Management Day is celebrated on April 29th every year to mark the binding importance of the global supply chain in the everyday lives of people. National Supply Chain Day brings all stakeholders together to share recent developments in the field. Introduced in 2020 by a Georgia-based packaging outlet, this holiday aims to raise awareness about the way a supply chain affects all of us, and how we can be better partners and benefactors of the global supply chain management system.

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One of the most iconic symbols of the COVID economy was the epic backlog of container ships waiting to dock at the ports of Los Angeles and Long Beach. At one point this year, that backup was longer than the line at Trader Joe’s on a Saturday, stretching 109 ships deep and almost 60 miles from the coast.

But now, the shipping situation is almost back to normal. As of last week, the number of ships waiting to drop off their goods stood at just four, according to the WSJ. Plus, the cost of sending a 40-foot container from Shanghai to LA has plummeted from its peak of more than $12,000 to almost $2,000, nearing its pre-COVID average.

The fact that goods are once again flowing smoothly through US ports is a hopeful sign that inflation, which was instigated in part by supply chain snarls, could start to abate.

CITE: https://www.r2library.com/Resource/Title/082610254

WHITE PAPER: https://medicalexecutivepost.com/wp-content/uploads/2011/06/scm-dr.-dem-sample.pdf

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BANKS: Eight Types; plus 1

Posted on April 28, 2024 by Dr. David Edward Marcinko MBA

DOCTORS NEED TO KNOW

SPONSOR: https://marcinkoassociates.com/

By Dr. David Edward Marcinko MBA CMP™

A general understanding of these bank types is suggested for any medical professional prior to launching a self-directed [ME, Inc] medical practice, clinic, guided investment strategy, personal financial plan or wealth building portfolio effort; etc.

READ HERE: https://marcinkoassociates.com/bank-types/

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Filed under: "Ask-an-Advisor", "Doctors Only", Career Development, Glossary Terms, Healthcare Finance, iMBA, Inc., Investing, Marcinko Associates, Op-Editorials, Sponsors, Touring with Marcinko | Tagged: bank types, banks, Commercial Bank, david marcinko, Dr. Marcinko, investment bank, Marcinko, Marcinko Associates, mutual banks, Retail Bank, savings loan, venture capitalist | Leave a comment »

FTC: Non-Competition Contract Clause Agreements?

Posted on April 27, 2024 by Dr. David Edward Marcinko MBA

By Staff Reporters

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FTC Votes 3-2 to Ban Non-Compete Agreements, but Legal Challenges Expected

The Federal Trade Commission (FTC) just voted 3-2 to issue a final rule striking new non-compete agreements for all workers and phasing out existing non-competes for all but senior executives across “most employers.” The ban does not apply to non-profits including many of the country’s healthcare provider organizations due to the limitations of the FTC’s jurisdiction, one of several points of contention that has been raised by hospital industry groups that have opposed the ban.

The final rule will take effect 120 days after its publication in the Federal Register. To be in compliance, impacted employers will need to stop enforcing existing non-competes with workers other than senior executives, inform those who are no longer bound by existing non-competes and stop initiating new non-competes for all workers going forward, FTC staff said during an open meeting on the final rule held last week.

Source: Dave Muoio, Fierce Healthcare [4/23/24]

Moreover, the stay-or-pay contract practice requires nurses to put in a certain amount of time “or be required to pay money to their employer for an alleged debt, which could be tied to so-called training, a sign-on bonus, or other costs their employer claims are related to their employment,” according to National Nurses United (NNU), a union that represents about a quarter of a million registered nurses (RNs).

“The new FTC rule is a step in the right direction for nurses and those aspiring to take on this critical role in our communities,” NNU President Nancy Hagans said in a statement.

MORE: https://tinyurl.com/bdethdwh

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Filed under: "Doctors Only", Career Development, Experts Invited, Risk Management | Tagged: Dave Muoio, Fierce Healthcare, FTC, Nancy Hagans, National Nurses United, non compete agreements, non-compete, nurses, NUU, Registered Nurses, Risk Management, RNs | Leave a comment »

PODCAST: Artificial Intelligence in Healthcare

Posted on April 26, 2024 by Dr. David Edward Marcinko MBA

By Eric Bricker MD

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Filed under: "Doctors Only", Career Development, Drugs and Pharma, Ethics, Experts Invited, Information Technology, Interviews, Videos | Tagged: AI, AI Healthcare, artifical inteligence, Eric Bricker JD | Leave a comment »

PODCAST: Artificial Intelligence in Medicine

Posted on April 26, 2024 by Dr. David Edward Marcinko MBA

MACHINE LEARNING AND NATURAL LANGUAGE PROCESSING

By Eric Bricker MD

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Filed under: "Doctors Only", Career Development, Experts Invited, Information Technology, Managed Care, Videos | Tagged: AI Medicine, Artificial Intelligence Medicine, Eric Bricker MD, Healthcare AI, Machine Learning, Maching Learning Medicine, Natural Language Processing, NLP | 1 Comment »

US INCOME GAP: A New Reality Check for Doctors NOT Going Broke!

Posted on April 25, 2024 by Dr. David Edward Marcinko MBA

Sobering News for all Medical Professionals

To Be Thankful

By Ann Miller RN MHA CMP

SPONSOR: https://marcinkoassociates.com/

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Poverty in America

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Assessment

Conclusion

Our Other Print Books and Related Information Sources:

Hospitals: http://www.crcpress.com/product/isbn/9781439879900

Physician Advisors: www.CertifiedMedicalPlanner.org

***

Filed under: "Doctors Only", Career Development, Ethics, Experts Invited, Financial Planning, Funding Basics, Investing | Tagged: american poverty, doctor paychecks, income gap workers, Marcinko, physician salaries, The US Income Gap as Reality Check for Doctors, US income | 3 Comments »

DOCTOR: Money “Disorders”

Posted on April 25, 2024 by Dr. David Edward Marcinko MBA

Behavioral Finance – Are You Guilty?

By Rick Kahler MS CFP® ChFC CCIM www.KahlerFinancial.com

As a young adult, what could you spend money on that would be a wise investment in your financial future? A home? Medical school education? A money management class?

Well, all of these may be good ideas, but there’s something else you can buy that could make an even greater difference in your long-term financial health: counseling.

Behavioral Finance

What does psychological counseling have to do with money? Sometimes; a lot!

For example, I was recently interviewed by a reporter for an article about money disorders. The conversation reminded me just how many problems can result from dysfunctional money beliefs and behaviors. Money disorders can impair people’s functioning and disrupt their lives just as significantly as disorders like alcoholism or other addictions.

CITE: https://www.r2library.com/Resource

Common Maladies

Some common money disorders include the following:

Compulsive Spending is a consuming focus on spending. It can include buying things you can’t afford as well as shopping where no money is actually spent
Financial Enabling is a codependent attempt to help others that actually does more harm than good. A pattern of bailing kids out financially is a good example.
Hoarding is compulsively buying and storing things that you don’t need or will never use.
Financial Infidelity is keeping money secrets (such as spending, saving, or investment mistakes) from your partner because you would be ashamed to have them find out.
Financial Incest is inappropriate sharing of worries or financial details in ways that violate the boundaries between children and adults.
Workaholism, especially medical professionals, is a consuming focus on work or earning to a point of damaging your relationships.
Under-spending is frugality taken to extremes, such as inadequate spending on health care, nutrition, shelter, or clothing even when you can afford them.

Not about Money

How many of the above “disorders” are you guilty of?

All these disorders have one thing in common: fundamentally, they aren’t about the money. A given pattern of behavior around money can be someone’s unconscious response to emotional pain, in the same way addiction or anger might be.

For that particular person, the money behavior may just happen to be the medicator that works to cope with deep emotional stress. While one person may find relief in alcohol or drugs and another may find it in work, someone else might use shopping or hoarding as a way to feel better and function in the world.

An Addiction?

Just like addictions, however, money disorders only relieve pain for a short time. In the long term, they only cause more pain. The result is an escalating cycle of destructive behavior that has many negative consequences, including financial ones.

Rag Mags

To see how emotional health and financial health are linked, all you have to do is read a celebrity magazine or look around at the people you know. I’ve seen high-earning doctors and other medical professionals who have a negative self-worth because they can’t control their spending. We all know people who bounce from one financial mess to another, never seeming to learn from their money mistakes. Some very capable and intelligent doctors struggle financially and in their careers because of emotional issues that have nothing directly to do with money.

Counseling

Counseling to resolve emotional issues may seem to be a low-priority expense that comes far down the list after basic needs like housing, food, and transportation. Yet for anyone who struggles to overcome destructive patterns of behavior—even those that aren’t directly about money—counseling can pay off in very real monetary ways.

Assessment

Emotionally healthy and confident people make better choices about relationships, careers, and other major aspects of their lives. They also make better choices about money. This is why counseling is more than an investment in your emotional health. It can also make a measurable difference in your financial health.

Conclusion

Filed under: "Ask-an-Advisor", "Doctors Only", Ethics, Experts Invited, Financial Planning | Tagged: behavioral finance, financial psychology, mental health, money disorders, Rick Kahler CFP® | Leave a comment »

DOCTORS & DENTISTS: Obtain a Financial Planning and Economic Education Consultation

Posted on April 24, 2024 by Dr. David Edward Marcinko MBA

You’ve Earned a Reduced Rate Second-Opinion in 2024

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SPONSOR: http://www.CertifiedMedicalPlanner.org

SPONSOR: http://www.MARCINKOASSOCIATES.com

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We have partnered with fiduciary focused financial advisors and fee-only financial consultants who understand the needs of doctors, dentists and medical professionals. More importantly, they understand how the healthcare industrial complex is currently in flux.

READ: https://marcinkoassociates.com/financial-planning/

INVITATION: So, If you are a colleague, schedule a conversation with one of them to review your goals to see if they can help.

ANN MILLER RN MHA CMP™

Please email us at: MarcinkoAdvisors@msn.com

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Some Retirement Statistics and Questions for Physicians

Posted on April 23, 2024 by Dr. David Edward Marcinko MBA

Transitioning to the End of Your Medical Career

SPONSOR: https://marcinkoassociates.com/

BY DR. DAVID EDWARD MARCINKO MBA MEd CMP®

SPONSOR: http://www.CertifiedMedicalPlanner.org

With the PP-ACA, increased compliance regulations and higher tax rates impending from the Biden administration – not to mention the corona pandemic, venture capital based healthcare corporations and telehealth – physicians are more concerned about their retirement and retirement planning than ever before; and with good reason. After payroll taxes, dividend taxes, limited itemized deductions, the new 3.8% surtax on net investment income and an extra 0.9% Medicare tax, for every dollar earned by a high earning physician, almost 50 cents can go to taxes!

Introduction

Retirement planning is not about cherry picking the best stocks, ETFs or mutual funds or how to beat the short term fluctuations in the market. It’s a disciplined long term strategy based on scientific evidence and a prudent process. You increase the probability of success by following this process and monitoring on a regular basis to make sure you are on track.

General Surveys

According to a survey from the Employee Benefit Research Institute [EBRI] and Greenwald & Associates; nearly half of workers without a retirement plan were not at all confident in their financial security, compared to 11 percent for those who participated in a plan, according to the 2014 Retirement Confidence Survey (RCS).

In addition, 35 percent of workers have not saved any money for retirement, while only 57 percent are actively saving for retirement. Thirty-six percent of workers said the total value of their savings and investments—not including the value of their home and defined benefit plan—was less than $1,000, up from 29 percent in the 2013 survey. But, when adjusted for those without a formal retirement plan, 73 percent have saved less than $1,000.

Debt is also a concern, with 20 percent of workers saying they have a major problem with debt. Thirty-eight percent indicate they have a minor problem with debt. And, only 44 percent of workers said they or their spouse have tried to calculate how much money they’ll need to save for retirement. But, those who have done the calculation tend to save more.

The biggest shift in the 24 years has been the number of workers who plan to work later in life. In 1991, 84 percent of workers indicated they plan to retire by age 65, versus only 9 percent who planned to work until at least age 70. In 2014, 50 percent plan on retiring by age 65; with 22 percent planning to work until they reach 70.

Physician Statistics

Now, compare and contrast the above to these statistics according to a 2018 survey of physicians on financial preparedness by American Medical Association [AMA] Insurance. The statistics are still alarming:

The top personal financial concern for all physicians is having enough money to retire.
Only 6% of physicians consider themselves ahead of schedule in retirement preparedness.
Nearly half feel they were behind
41% of physicians average less than $500,000 in retirement savings.
Nearly 70% of physicians don’t have a long term care plan.
Only half of US physicians have a completed estate plan including an updated will and Medical directives.

Retired MD Doctor Retirement Gift Idea Retiring - Doctor ...

Thoughts to Ponder

And so, to help make your golden years comfortable and worry free, here are ten important retirement questions for all physicians to consider:

How much money do you need to retire?
What is your retirement cash flow?
What is your retirement vision?
How to stay on retirement track?
How to maximize retirement plan contributions such as 401(k) or 403(b)?
How to maximize retirement income from retirement plans?
What are some other retirement plan savings options?
What is your retirement plan and investing style?
What is the role of social security in retirement planning?
How to integrate retirement with estate planning?

The opinion of a competent Certified Medical Planner® can assist.

ASSESSMENT: Your thoughts, comments and input are appreciated.

Comprehensive Financial Planning Strategies for Doctors and Advisors: Best Practices from Leading Consultants and Certified Medical Planners™

ORDER Textbook: https://www.amazon.com/Comprehensive-Financial-Planning-Strategies-Advisors/dp/1482240289/ref=sr_1_1?ie=UTF8&qid=1418580820&sr=8-1&keywords=david+marcinko

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