Monthly Archives: September 2015

Don’t Venture Too Far Without Adequate Insurance

Spring is in the air, and summer is right around the corner. Like many Americans, you might be planning a little relaxation time this year. Half the fun is planning the trip which could take weeks laying out details, and shopping for the best rates. It is possible that sickness or serious health issues can come up around the time you plan your vacation. A travel insurance policy can help protect your travel investments if any potential “what-ifs” become an unfortunate reality.

Let’s say you booked passage on a cruise and a week before the trip you receive a call that the cruise has to be cancelled due to mechanical failure. The cruise liner will probably offer a full refund and maybe even a discount on your next trip, but what about the plane ticket that cost you several hundred dollars? Without the protection offered by travel insurance, you could be stuck with the transportation expenses.

Asset Protection for Physicians

Avoiding Financial Hardships While on Vacation

Delayed or missing luggage, cancelled cruises, weather delays for flights and even medical care costs while you are out of network can all spell disaster. While the U.S. embassy or consulate can help find medical services and assist in the transfer of funds from home, they won’t pay for medical care or the cost of repatriation back to the U.S.

For many trips, it may be necessary to rent a vehicle while on vacation. Rules and regulations differ from state to state as well as from country to country. Be sure to have a conversation with your insurance agent before you make any incorrect assumptions, and ask about “loss of use”. This is when the rental car is damaged while in your care, and has to go to the shop for repairs. The rental company may charge you the rental-fee for each day the car is being serviced, and “loss of use” is rarely covered under a standard auto insurance policy.

If in doubt, check with your insurance company to make sure your vacation destination is within their territory. With most insurance policies, the difference between carriers is contained in the fine print and isn’t always easy to understand. Contact your insurance agent for clarification on what is covered by your policy so you aren’t surprised by any financial hardships that could occur during your vacation.

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Advisory services offered through Larson Financial Group, LLC, a Registered Investment Advisor. Securities offered through Larson Financial Securities, LLC, member FINRA/SIPC.

Larson Financial Group, LLC, Larson Financial Securities, LLC and their representatives do not provide tax advice or services. Please consult the appropriate professional regarding your tax planning needs.

How to Create Ultra-Secure Passwords That Keep Hackers Away

By Devin Kropp

With data breaches occurring more and more, it is important to protect personal information stored in online accounts with secure passwords. The majority of passwords do not pass the test. Learn how to create a password that will keep your data safe online.

Would you rather wash the dishes than create a new password for an online account? If you chose the dirty dishes, you are not alone. According to a study by Harris Interactive and Janrain, 38% of those surveyed would prefer doing household chores over creating a secure username and password combination. And when we finally sit down to create these passwords, we don’t seem to be that good at it.

According to Instant Checkmate, 73% of people use the same password for multiple sites. Even scarier, 33% of people use one password for every site they visit.

With weak passwords all over the Internet, researchers at Imperva found that it would take an expert hacker under 20 minutes to break into 1,000 different accounts. That doesn’t leave you with very good odds.

Doctor Financial Advisor

The number of identity theft cases is growing every day, and hackers can gain access to your life by breaking one password. A study done by Javelin Stategy found that one person becomes a victim of a hacked account every two seconds—a total of 13.1 million victims in 2013.

Chances are, once hackers gain access to one of your accounts, they will be able to gain access to many more accounts by trying the same password or resetting your password if they have broken into your email. Take Wired writer Mat Honan: Once a hacker got into his Apple ID account, his Twitter, iPhone, Mac, and Gmail accounts were all compromised. The hacker went so far as the clear Honan’s hard drive clean, deleting pictures of his child’s first year, which are now gone forever.

But there are steps you can take to make your passwords secure and keep the hackers out.

Password Don’ts

  • Avoid common passwords: Researchers at Instant Checkmate found that the most common password of 2012 was “password.” That doesn’t make a hacker’s job very hard. Protect yourself by avoiding passwords that are commonly used and first for hackers to guess, such as “12345” or “abc123.”
  • Avoid passwords that can be easily guessed. Next on a hacker’s list of possible passwords? Your name, your spouse’s name, you child’s name, your pet’s name, your birthdate, etc. Any information you share on social media acts as clues to your password for hackers. For that reason, it is important to stay away from details that could be found easily through your online presence. Even if you do not use social media, you should not use these details as passwords. Others may be able to gain access to this information through other means.
  • Avoid dictionary words. While there a millions of dictionary words to choose from, a simple lowercase word is not a secure password. Hackers know which words are used most often—and if you password is one of these words, it won’t be long before they break in.
  • Don’t use the same password for multiple accounts. By using the same password over and over again, you are making a hacker’s job easy. Once they gain access into one of your accounts, they will likely try that same password to get into other accounts you have. If the password is the same, they can easily wreak havoc on many different aspects of your life.

Now you know what not to do. So how do you create a secure password? Let’s say right now your password is “finance.” Let’s go through the steps to take that weak password and transform it into a safe and secure password you can use.

Password Do’s

  • Passwords should be at least eight characters long. Longer passwords are generally more difficult to hack. Instant Checkmate found that the average password is only six characters long—not enough characters to keep hackers out. Our example of “finance” is only seven characters long and at the moment is a weak password.
  • Use letters, numbers, and symbols. Using all three characters makes it more difficult for hackers, as there are more variables they have to get right. So instead of “finance,” your password could be: finance/8$. While that is better, we can still improve this password’s strength.
  • Use both uppercase and lowercase. Again, this adds security, as there are more details a hacker would have to guess. With this new rule, “finance/8$” could become: FiNance/8$. Better, but we can still do more.
  • Use a mnemonic phrase. As we discussed earlier, dictionary words are easier to hack. But passwords containing dictionary words are easier for us to remember. There is a way to create a password that is strong—and easy to remember. If you can remember a sentence, you can remember a secure password. Think of your favorite song, poem, prayer, or pledge. Take a line from that and use the first letter of each work to construct your password. For example, take the Beatles’ “Strawberry Fields Forever.” The first line, “Let me take you down, ‘cause I’m going to Strawberry Fields” is memorable and can be transformed into a secure password you can use. Taking the first letter of each word of that line your password becomes “LmtydcIgtSF.” Now, of course, we need to add some numbers and symbols. Your final password could look something like this: Lmtyd_cIgtSF/76. If you are a Beatles fan, this password will be easy to remember but hard for the hackers to break into.
  • Use two-factor authentication. Many sites now offer two-factor authentication when logging into accounts. For example, when logging into a site with two-factor authentication enabled, a code will be sent to your phone that you must enter after your password to gain full access. In order to log in, you must have your password and a special code that is changed every time. If a hacker successfully guesses your password but does not have your phone, they cannot get into your account. Currently, sites such as Gmail, Facebook, Dropbox, Twitter, and more offer this service. Many banks and credit card companies offer this service for online usage as well.

It is important that you apply these rules to all of your passwords and create new, unique passwords for all of your different logins. It is also suggested that you change your passwords at least twice a year.

Password Services

If the thought of creating multiple secure passwords and remembering them all seems daunting, there are services that can help.

  • 1Password is software you can download that will store your login credentials for each site. After downloading the program, you will be prompted each time you log in to a site to save that password into your 1Password account. Your 1Password account is protected by a master password (the only one you have to remember). In order to access any of your other passwords saved in the software, you must enter your master password to retrieve it.This program can also generate strong passwords for you, and since you don’t have to remember them yourself, they can be long and almost impossible to remember—making them extremely difficult to hack. All your passwords are encrypted, meaning that even 1Password doesn’t know what they are. If you forget your master password, you lose access to your password list. 1Password does not offer two-factor authentication at the moment, but your registered device is needed to access your password list, which does add more security. The program is available for Macs, PCs, smartphones, and tablets. 1Password for a desktop costs $49.99; it’s $14.99 for an iPhone/iPad. The app is free for Android phones and tablets.
  • LastPass also uses one master password to store all of your logins. Once you sign up, LastPass will begin to save your logins for each site that you browse. The next time you visit that site, LastPass will automatically log in for you. This service can also help you generate strong passwords. Your passwords are encrypted and then decrypted locally, so they are known only by you.The service also has a multifactor authentication option that adds an extra level of security to your passwords. You can download the basic service for free, or you can get the premium service for $1/month, which gives you unlimited access to LastPass on all your devices, including desktop, laptop, smartphone, and tablet. LastPass is compatible with iOs, Android, Windows Phone, and BlackBerry.
  • KeePass also protects all of your logins with one master password. The service also protects you from keyloggers. A keylogger is malware that a hacker can install on your devices that keeps track of everything you type, making it easier to hack your accounts. KeePass protects against this through its Auto-Type feature, which automatically pastes your password into the password box of a site. There is an additional plug-in you can install within KeePass to set up two-factor authentication to add more security. KeePass is available for PCs and Macs as well as smartphones and tablets. Best of all, this service is completely free to download and use.

An easy way to protect yourself from thieves looking to steal your identity is by creating strong, secure passwords for all of your accounts. Following these tips can help you transform an easily hackable password into a secure password, better protecting your identity and personal information stored online. Don’t let the hackers in—update your passwords today to stay safe.

Devin Kropp is a New York- based writer for Horsesmouth.

Devin Kropp is not affiliated with Larson Financial Group.

IMPORTANT NOTICE: This reprint is provided exclusively for use by the licensee, including for client education, and is subject to applicable copyright laws. Unauthorized use, reproduction or distribution of this material is a violation of federal law and punishable by civil and criminal penalty. This material is furnished “as is” without warranty of any kind. Its accuracy and completeness is not guaranteed and all warranties expressed or implied are hereby excluded.

Advisory Services offered through Larson Financial Group, LLC, a Registered Investment Advisor. Securities offered through Larson Financial Securities, LLC, Member FINRA/SIPC.

Copyright © 2015 by Horsesmouth, LLC. All Rights Reserved

Integrating Value-Based Payments in Healthcare

Healthcare reform has led many physicians to express concerns about the future of the industry. Change is difficult, and can often lead to stress. Stress is a heavy burden to bear as a physician and can unintentionally affect the treatment of patients.

The traditional fee-for-service payment system is under criticism for driving up the nation’s healthcare bill by rewarding over use. Under this model, providers are penalized for providing better care that keeps patients from repeatedly interacting with the health system. Various efforts to change productivity incentives for doctors and hospitals are being tested nationwide. One is a value-based payment model that offers bonuses to doctors delivering high-quality care that is cost effective. They would be compensated for the value of the care they provide, rather than the volume of services rendered.

Defining Value

There are various value-based care models for an organization to choose from and it’s up to the provider to determine which is the best fit for their healthcare organization. While most agree that the shift to value-based payments is a positive development for the industry, some healthcare systems simply don’t have the infrastructure in place to evaluate their population’s risk factors yet. Furthermore, there is no broad agreement as to what “value” means and how to measure it, as many value-based arrangements are largely still experimental at this point.

Medical Practice Consulting

For many, value is linked to patient satisfaction. This has led many to increase their focus on hospitality, food quality, décor and other factors conducive to a positive experience for the patient. However, patient satisfaction is not always indicative of quality healthcare and outcomes. There are still some areas of medicine that could lend themselves better to a fee-for-service reimbursement for quantifying productivity.

For value-based payment models to work there has to be a way to motivate patients into taking ownership of their health. In addition to eating well and exercising, patients need to take their prescribed medication and follow instructions from their doctor. Ultimately, value-based payment cannot address all the underlying causes of poor health and many have suggested that a broader public health strategy is necessary.

Decline of Private Practice

A number of employers and insurers are already paying health systems a yearly, all-inclusive payment for each patient regardless of their medical needs or how many tests are dispensed. Insurers have also become more aggressive in demanding lower rates from individual practices with little clout to resist. Providers also worry that the goalposts will always be in flux, and that insurers will simply offer less during the next contract if savings are achieved in the 1st year. Standardizing performance metrics and benchmarks across the many insurer plans and provider groups will be challenging and might require a legislative mandate.

Smaller practices are struggling to keep overhead low in this new era of greater regulations and declining reimbursements because they don’t have the leverage to effectively negotiate terms and fees with an insurer. As a result, the percentage of physicians in solo and partnership practices continues to drop. According to data from Merrit Hawkins, one of the nation’s leading physician placement firms, search requests for soloists fell from 22% of all requests in 2004 to 1% in 2012.

Other factors beyond the decline of government and private health plan payments have many doctors considering consolidation with major health systems, such as the need to invest in electronic health records. Medical systems are also increasing the number of doctors they hire as employees. Large hospitals have a reputation for not negotiating after they’ve made an initial offer, but signing and productivity bonuses can be increased by having a solid grasp of the market value for that area.

While remaining independent is a challenge, many small and solo practices improve their chances of survival by banding together in independent practice associations (IPAs) that share practice management services. These function similar to group practices but allow the physician the flexibility to set their own hours, hire their own staff and opt-out of certain insurers. However, hospital employment doesn’t mean a physician has to totally relinquish control. Many doctors receive leadership and director positions with their new employers that allow them a fair amount of input regarding critical decisions.

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Advisory Services offered through Larson Financial Group, LLC, a Registered Investment Advisor. Securities offered through Larson Financial Securities, LLC, Member FINRA/SIPC.

Gravel Road Investing

By Jim Parker, Vice President DFA Australia Limited

May 20, 2015

Owners of all-purpose motor vehicles often appreciate their cars most when they leave smooth city freeways for rough gravel country roads. In investment, highly diversified portfolios can provide similar reassurance.

In blue skies and open highways, flimsy city sedans might cruise along just as well as sturdier sports utility vehicles. But the real test occurs when the road and weather conditions deteriorate.

That’s why people who travel through different terrains often invest in a SUV that can accommodate a range of environments, but without sacrificing too much in fuel economy, efficiency and performance.

Structuring an appropriate portfolio involves similar decisions. You need an allocation that can withstand a range of investment climates while being mindful of fees and taxes.

When certain sectors or stocks are performing strongly, it can be tempting to chase returns in one area. But if the underlying conditions deteriorate, you can end up like a motorist with a flat on a desert road without a spare.

Likewise, when the market performs badly, the temptation might be to hunker down completely. But if the investment skies brighten and the roads improve, you can risk missing out on better returns elsewhere.

One common solution is to shift strategies according to the climate. But this is a tough, and potentially costly, challenge. It is the equivalent of keeping two cars in the garage when you only need one. You’re paying double the insurance, registration, and upkeep costs.

An alternative is to build a single diversified portfolio. That means spreading risk in a way that helps your portfolio capture what global markets have to offer while reducing unnecessary risks. In any one period, some parts of the portfolio will do well. Others will do poorly. You can’t predict which. But that is the point of diversification.

It is important to remember that you can never completely remove risk in any investment. Even a well-diversified portfolio is not bulletproof. We saw that in 2008–09, when there were broad losses in markets.

But you can still work to minimize risks you don’t need to take. These include unduly exposing your portfolio to the influences of individual stocks, sectors, or countries—or relying on the luck of the draw.

An example is those people who made big bets on technology stocks in the late 1990s. These concentrated bets might pay off for a little while, but it is hard to build a consistent strategy out of them. And those fads aren’t free. It’s hard to get your timing right, and it can be costly if you’re buying and selling in a hurry.

By contrast, owning a diversified portfolio is like having an all-weather, all-roads, fuel-efficient vehicle in your garage. This way you’re smoothing out some of the bumps in the road and taking out the guesswork.

Because you can never be sure which markets will outperform from year to year, diversification can help increase the consistency of the outcomes and help you capture what the global markets have to offer.

Add discipline and efficient implementation to the mix, and you may get a structured low-cost, tax-efficient solution.

Just as expert engineers can design fuel-efficient vehicles for all conditions, astute financial advisors know how to construct globally diversified portfolios to help you capture what the markets offer in an efficient way while reducing the influence of random forces.

There will be rough roads ahead, for sure. But with the right investment vehicle, the ride can be a more comfortable one.

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All expressions of opinion are subject to change without notice in reaction to shifting market conditions. This content is provided for informational purposes, and it is not to be construed as an offer, solicitation, recommendation or endorsement of any particular security, products, or services.

Dimensional Fund Advisors LP (“Dimensional”) is an investment advisor registered with the Securities and Exchange Commission.

Copyright © 2014 by Dimensional Fund Advisors LP. All Rights Reserved

The Myth of the Rich Doctor

By Vicki Rackner MD, President of Medical Bridges

Are you in a financial position to do what you want to do when you want to do it? Could you afford to retire, care for ailing parents or reinvent your medical practice?

Healthcare Practice Management

Wealth buys the freedom to decide how you spend your days. My investments gave me the safety net to leave my conventional surgical practice and launch into a career as an author and speaker and consultant promoting better medical outcomes.

Here’s the dirty little secret. Most physicians are economic slaves to their practices. Our high incomes do not reliably translate to high net worth and the freedom wealth buys.

Income Vs. Wealth

Practicing physicians earn top dollars. The U.S.Bureau of Labor Statistics (http://www.bls.gov/oes/2012/may/high_low_paying.htm) culled data from tax records to conclude that nine of the top ten earners in the U.S. call themselves “doctor.”

Indirect evidence supports the assertion that physicians fail to build wealth. In a recent survey (https://www.amainsure.com/2013-report-on-physicians-financial-preparedness.html), half of physicians are behind where they would like to be in retirement planning. Professional medical associations are exploring how to assess competency in older physicians who continue to practice because they cannot afford to retire.

The Reasons Physicians Fail to Build Wealth

What keeps physicians from building wealth? Here are the reasons usually cited:

  • Medical school debt
  • Late start on earning and savings
  • Failure to protect assets against known and overlooked risks
  • Poor tax planning
  • Getting investment advice from the wrong people
  • Fraud and theft

This is like saying patients become obese because they eat too many donuts. It may be true, but it fails to tell the whole story. Further it fails to lead to sustained solutions that deliver different outcomes. Budgets work about as well as diets.

The Real Causes of Unrealized Wealth

I believe that physicians’ failure to build wealth is a symptom of a deeper financial ill: their dysfunctional relationship with money.

Physicians as a group are intelligent people who:

  • Tend to overestimate their ability to manage money, and underestimate the level of difficulty of the challenge.
  • Lack insight about what they do and do not know.
  • Turn to money to solve non-financial problems, like alleviating their guilt about spending so little time with their families.

The real barrier to financial freedom comes down to a conspiracy of silence around money. For physicians, money is the ultimate taboo topic. You cannot fix problems that you cannot talk about.

Here are three reasons physicians avoid conversations about money:

  • The culture of medicine Just as the government calls for the separation of church and state, medical ethics calls for a separation between the care a patient gets and a patient’s ability to pay. We physicians learn to avoid conversations about money to uphold this ethic. As a practicing physician I often thought that delivering medical services was like ordering a meal off of a restaurant menu without any prices. Small wonder health care costs spiraled out of control!
  • Lack of formal education Physicians get no courses in business or financial management in medical school or in residency
  • Awareness of their vulnerability Physicians experience themselves as financial prey. They turn to people they trust–their colleagues for financial advice. I include myself in the group of physicians who have fallen for “DDD’s”–dumb doctor deals.

The Path to Wealth

Physicians have the ability to build wealth.

As Einstein says, problems are not solved on the level at which they are created. The solution begins with physicians’ willingness to tolerate the discomfort when discussing money.

Here are three steps to help physicians achieve financial freedom:

  1. Coach physicians to proactively engage in conversations with patients about the costs of medical care.
  2. Explore –with compassion– the forces that drive spending. Here are some things that struggling physicians say to themselves.
    • “I deserve nice things.” You know the sacrifices you and your family made to answer this call to medical service. When physicians finally start earning their 6-figure incomes, they feel that it’s time to splurge.
    • “I can save lives and I’m smart; that means I can manage my own money.” You cannot see into your blind spot.
    • “There will always be more than enough money.” This physician fails to plan, trusting that there will be a bright financial future. Without a plan, money tends to wander off.
    • “You invested in a marijuana farm with a 200% return? Count me in!” Physicians can follow trusted colleagues into marginal investments.
    • “Look at me!” This physician wants to maintain the appearance of success at the cost of building true wealth.
    • “Sure, I trust you.” Physicians’ trusting nature makes them easy targets for embezzlement, fraud and ploys.
    • “I’m embarrassed.” Many physicians wonder how smart people like themselves could make such ill-informed choices. Disclosing mistakes can be painful.
    • “Mother Teresa took a vow to poverty; I should, too.” This physician does not feel worthy of wealth.
    • “Show me where to sign.” Physicians are often unaware of their power to negotiate contracts, or lack the skill and experience to execute.
  3. Replace wealth-eroding beliefs and habits with new wealth-building tools and skills. Just as we have mentors to guide us through the art and science of caring for patients, mentors and coaches helped me change my beliefs and behaviors around money. I offer my son– headed for medical school–basic financial literacy lessons I never got. I hope he aligns his spending habits with Einstein’s insight, “Compound interest is the eighth wonder of the world. He who understands it, earns it; he who doesn’t pays it.”

Wealth-building is not a do-it-yourself job for most physicians. If you or a family member had a rare medical condition, you would not treat it yourself; you would seek the help of the expert. Manage your wealth with the same strategies you use when you manage your health.

Financial advisors know about the complexities of “referred financial pain” the same way you know about the association of right shoulder pain and an inflamed gallbladder. Could you acquire this knowledge? Absolutely. The real question is whether you want to invest the time and effort.

Physicians can achieve financial freedom. With the economic stresses posed by the Affordable Care Act, now is the time for physicians to take control of their financial destiny.

Have Questions?

Vicki Rackner MD, President of Medical Bridges, works with physicians who want to thrive. This surgeon, author, speaker and consultant offers a bridge between the world of medicine and the world of business.

The article and opinions contained herein are strictly those of the author. This article is not and should not be construed as an endorsement of or testimonial for Larson Financial Group, LLC

Advisory services offered through Larson Financial Group, LLC, a Registered Investment Advisor. Securities offered through Larson Financial Securities, LLC, member FINRA/SIPC. Larson Financial Group, LLC, Larson Financial Securities, LLC and their representatives do not provide legal or tax advice or services. Please consult the appropriate professional regarding your legal or tax planning needs.

Copyright © 2015 by Vicki Rackner MD. All Rights Reserved