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Category Archives: Practice Management

Three Things You Didn’t Know About Taking a Vacation

When was the last time you took a good vacation? Has it been months? Years? A decade or more? You wouldn’t be alone.

According to an article from Medscape, over a third of family physicians and almost as many emergency medicine physicians, internists and general surgeons take off two weeks per year at most.

Planning time away from your practice and daily grind are key to preventing burnout. A study conducted in 2010 found some interesting things about vacationing. Here are a few things you may not have known about taking a vacation.

  • Anticipating a vacation can be as rewarding as actually taking a vacation. Vacationers are generally happier than non-vacationers, but post-vacation happiness was similar among both groups. That could mean that planning and then looking forward to a vacation may be more beneficial to your stress levels than the vacation itself.
  • Quantity over quality. Given that post-vacation happiness levels are similar between vacationers and non-vacationers, the length of the trip you take may matter less than you think. Consider taking a handful of shorter vacations throughout the year as opposed to one or two long vacations to maximize the “pre-trip happiness.”
  • You may not be relaxed unless you’re truly relaxed. Vacations generally don’t add much to your happiness, post-trip. Only those who take “very relaxed” holiday trips benefit most in terms of post-trip happiness. When you decide to take your vacation, truly leave work at work. To gain the maximum benefit, focus on the vacation and getting the most enjoyment and relaxation out of your activities before you return to work.

As a doctor, it can be tough to schedule time away. You’re busy, you have patients to see and you may have a practice to run.

To remain happy in your career and prevent burnout that can be very common among doctors, make it a priority to take some time out for yourself and your family throughout the year. You’ll thank yourself down the road.

Are you inspired to plan your next vacation? Our financial advisors can help you fit it in the budget.

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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.
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What is Business Overhead Expense Disability Insurance?

The disability insurance you may have individually can take care of your basic needs, such as your student loan payment and mortgage, but what happens if you own your own practice and become disabled? Your individual policy likely won’t include funds for hiring someone to replace you. That’s where business overhead expense insurance comes in.

Business overhead expense insurance is a disability policy that can be customized to suit your needs. This policy lets you set aside an amount of money to cover a period of time, no longer than two years, intended to cover a period of time needed to either hire a new doctor for your practice or to heal and come back to work.

Some things to look for in business overhead expense insurance is the amount of coverage, whether you can pay for the salary of another doctor, and the termination period for when the policy will begin paying out.

The amount of coverage is self-explanatory: you choose an amount anywhere from $10,000 per month to $30,000 per month. Choose an amount that can cover your needs.

Hiring another doctor is a piece of the policy you need to be sure is included before you buy it. Many policies will include terms to cover costs of running the practice, like your staff, your rent and all other basic expenses but won’t cover costs of hiring new staff. Be careful that the contract states you can use the funds to pay the salary of another doctor.

The termination period is important because if you choose a period that’s too long, like 60 or 90 days, you may run out of income before that date hits, leaving you in a bad situation. Many doctors who own a practice will have accounts receivable coming in for a period of time from past cases, and you need to ensure your business overhead expense insurance will overlap with that money, rather than leaving yourself with a gap.

With these types of policies, you’ll want to make sure there isn’t a significant drop on money coming into the practice, which is why this type of coverage is so important to those who run their own practice.

Do you need to re-evaluate your disability policy to include business overhead expense insurance?

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.

How EHR Implementation Can Improve Your Practice

Of the many recent changes in the healthcare, one of the most significant has been the adoption of electronic health records. An electronic health record (EHR) is a digital version of a patient’s paper chart that includes a comprehensive patient history from all providers involved in the patient’s care. As a result, EHRs have vastly improved care coordination and helped with reducing medical errors in the healthcare community at large.1

Healthcare Practice Management

Convenience for the Doctor and Patient

Health information technology makes interactions with healthcare systems more convenient, reliable and less time consuming. EHRs allow physicians to share and receive patient data rapidly. All healthcare providers are able to view an up-to-date version of a patient’s medication list, as well as send prescriptions directly to any pharmacy’s system. EHR’s also provide a secure base for physicians to be able to access patient information. These certified systems allow only the proper professionals to have access to this information.2

Both the patient and the doctor’s time is extremely valuable, and EHRs can help improve overall patient satisfaction by providing reminders for the doctor and patient to follow up from an appointment. With EHRs, physicians don’t have to repetitively write down information from all the years of seeing the same patient. Any previous tests a patient has had done is documented on their electronic health record, so doctors and patients save time and money on repeating examinations.3

Converting to Electronic Health Record Systems

Converting from paper charts to EHRs requires careful coordination. Selection and implementation of training, along with the maintenance that comes with it, are just a few of the challenging decisions a healthcare organization will face in the midst of the transition from paper to electronic.

Historical patient information has to be converted safely and correctly into an EHR system. It is best to limit the conversion to only current patients. Deceased patient records must be stored for the appropriate retention period, but should not be scanned into the new system. During this transition, it is imperative your healthcare organization arranges for the proper disposal of paper records after the conversion is complete.4

Converting the data will vary depending on the kind of medical practice, but finding the method that works best will help make this process go smoothly. Whichever method the practice decides must be cost effective while keeping the patient’s personal information secure. This will all depend on the resources available to the practice, timeframe allowed and the amount of information that needs to be transferred.5

Besides cost, there’s a handful of other considerations you should account for in order to ensure a successful conversion:

  • Hardware: database servers, desktop computers, tablets, laptops, printers and scanners
  • EHR software: application, interface modules and upgrades
  • Implementation assistance: IT contractor, attorney, electrician and consult support
  • Training: medical organizations need to train physicians, nurses and office staff before and during implementation
  • Ongoing network fees and maintenance: hardware, software maintenance agreements, continuous staff education and IT support fees

Electronic health record systems are the first step to transformed healthcare. They help provide overall better healthcare by improving efficiencies and lowering costs while promoting better clinical decision making. In addition to financial incentives, it’s reasonable to anticipate that practice operations will be smoother and more organized as a direct result of a successful implementation.

Have Questions?

References:

  1. Dr. Robert E. Hoyt, “Need for Electronic Health Records (EHR)” (July 2014). http://www.practicefusion.com/health-informatics-practical-guide/
  2. U.S. Department of Health and Human Services, “Advantages of Electronic Health Records” (September 2014). https://www.healthit.gov/providers-professionals/faqs/what-are-advantages-electronic-health-records
  3. Bell, B, Thornton, K, “The Need for Better Improved Care Coordination” (2011). https://www.healthit.gov/providers-professionals/improved-care-coordination
  4. AHIMA. “Migrating from Paper to EHRs in Physician Practices.” Journal of AHIMA 81, no.11 (November–December 2010): 60-64. http://library.ahima.org/doc?oid=103171#.V_VykegrKM_
  5. U.S. Department of Health and Human Services, “Health IT Makes Health Care Convenient” (February 2013). https://www.healthit.gov/patients-families/health-it-makes-health-care-convenient

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

Is It More Sensible to Buy or Lease Medical Office Space?

Private practice physicians who are looking to open their own practice face the dilemma of whether to own or lease a medical office space. The decision to lease or buy will depend on your business objectives as a physician, as it will impact your practice finances and possibly affect your relationships with associates.

Buying a building can help physicians build their wealth, but the purchase of a medical space can be risky, and sometimes it’s just not a large enough advantage over renting.1 Three factors are of particular importance when determining whether to lease or buy:

Expenses

Monetary concerns are usually of primary importance when a physician decides to open their own practice. The amount of business expenses you are comfortable incurring will be a primary factor when considering whether to buy or lease.

Forrest Friedow

At an initial comparison, the math is simple – leasing is cheaper in the beginning. To lease, you do not need as much money upfront, as the first payment is typically the building’s first monthly rent check, a security deposit and any extra tenant-improvement dollars over your allowance. However, your monthly rent is a variable cost that could change when the lease expires depending on the climate of the market.

On the other hand, purchasing a practice upfront is a much bigger initial investment. A building purchase could include loan fees, building inspections, an appraisal and several other soft costs. On the upside, purchasing a building means your monthly payments will be fixed, giving you a better understanding of what you’ll pay year after year.2

Tax Advantages

As the owner of a building, you may have the benefit to deduct the depreciative value of real estate, as well as the purchase loan, property taxes and other qualifying expenses. For a lease, most rent and related occupancy costs are deductible currently against taxable income instead of deferred to future periods.3 By and large, the tax advantages of the transaction tend to be a secondary consideration and not a driving factor behind the decision.

Expansion & Location

Every physician wants to be successful in their private practice. What if your business is flourishing and your building is too small to keep up? As an owner, you would have the advantage of adding to your existing space to meet the growing needs of your practice. Unfortunately, if you’re leasing a building, you will likely have to get permission from your landlord for any substantial changes made to the property, depending on the cost of the additional space – if it’s even available at all.

Before deciding to lease or buy, you want to make sure you’re keeping your long-term plans in mind. If you are opening a practice in an area that is not your desired longstanding location, you should consider seeking a rental property and avoid purchasing a building.

The Big Picture

The verdict to lease or buy basically comes down to a financial decision, so it’s important to understand all of the potential costs of both scenarios. Being the owner of a building will require more expenses to maintain your practice, but it will allow you to build equity and spread out the costs of building improvements and operating expenses over a longer period of time. However, if you expect to outgrow your space within the next five to 10 years, leasing a building would probably be the more suitable option. This will allow you to spend more time focusing on building your patient base without having to worry about unexpected building costs and repairs.4

Ownership of a medical space can be a great investment, but it may not be an ideal arrangement for every physician. Do your research and don’t hesitate to get help from commercial brokers, building inspectors, accountants, financial lenders, contractors, etc. for further information. Establish and review your objectives, and run your numbers to guide you toward the most informed final decision.

Have Questions?

References:

  1. Janet Kidd Stewart, “Should You Own Your Building?” (July 2009). http://www.physicianspractice.com/articles/should-you-own-your-building
  2. Leo Griffin, “Buy or Rent Medical Office Space – Consider These Points” (November 2014). https://www.linkedin.com/pulse/20141104123549-36311453-buy-or-rent-medical-office-space-consider-these-points
  3. James B. Calnan, CPA, “Decisions, Decisions Medical Office Space: Buy, Lease or Walkaway” (May 2008). http://healthcarenews.com/decisions-decisions-medical-office-space-buy-lease-or-walk-away/
  4. Marley McMillen, MBA and Jim Arend, MBA, “Before You Sign That Office Lease” (November-December 2010). http://www.aafp.org/fpm/2010/1100/p17.html

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Launching a Successful Practice

For physicians seeking the autonomy and flexibility that comes with being your own boss, the appeal of private practice is understandable. Branching out from the hospital community to take a step into private practice can be one of the most rewarding, yet challenging experiences of your career. Despite all of the changes happening in healthcare, studies from Physicians Foundation and the AMA have shown that doctors in physician-owned practices are more satisfied than those working for hospitals or larger delivery systems.

There are several locations throughout the U.S. where a private practice could be successful and profitable. Many doctors don’t comprehend the amount of work and effort that goes into starting your own practice. Consider these guidelines as a starting point to launching your own practice.

Covering the Basics

For starters, find a location that is suitable for your personal preference, but is also highly visible and in a heavily-marketed area. In addition to your budget, whether you are looking for a small or large practice could also make certain locations less viable. Take the time to calculate your budget and figure out if you want to slowly build up your practice or purchase everything all at once. If you choose to get the support of a lender, many banks have specialty departments that lend exclusively to doctors and offer attractive rates and terms.

Disability Insurance for Doctors

As a physician, you are probably cognizant of lawsuit risks and property damage that come with running your own practice. Take action well in advance and invest in a business insurance plan that will protect your personal and commercial assets. This plan could include, but is not limited to: general liability insurance, property insurance, malpractice insurance, workers’ compensation insurance, business liability insurance, and personal disability income insurance.

Building a Lively Culture for Your Practice

An essential part of your practice is your medical staff. When the hiring process begins, look for highly-motivated candidates that are as invested as you are. It is common for a private practice to have a receptionist, medical assistants, nurses and legal/financial management. Surround yourself with the right people that will make you and your patients’ experience a positive one.

Having a good accountant is especially important, preferably somebody who has past experience handling business taxes, record keeping and payroll for a medical practice. As a business owner, you’ll likely be entering into multiple contractual agreements at some point. Having a competent attorney at your disposal to review all of your contracts and accommodate any legal issues that may come along is also a wise decision for any business owner.

Standing Out from the Crowd

If you want to establish and develop a successful business, you must sell yourself and your practice. Create a marketing strategy that will pinpoint ways for you to stand out among the rest of private practitioners. Get your name out there by meeting people face to face. Introduce your company to members of the community such as pharmacists, the township and the police department.

Not only is it important to get your business to stand out, you also want to make sure your office has updated décor, supplies and equipment. Furniture and room décor may not seem like a huge factor, but a welcoming environment is actually quite significant for a patient’s overall experience and satisfaction. Up-to-date medical equipment is also just as important.

Through all the work, stress and time you will put into starting up your private practice, be sure to take some time for yourself. Practice management can be exhausting and cause burnout, so it is important you set aside time to do the activities you enjoy. Keep in mind that private practice is not for everyone, that’s why it is best to understand the process of launching your own practice before moving forward with it.

Have Questions?

References:

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

The information provided is for informational purposes only and should not be construed as a recommendation or advice. Further, this is not an offer to buy or sell securities or other products and services of Larson Financial Group or its affiliates. Please consult an appropriate investment professional regarding your specific needs.