I had a doctor mention to me recently that he really couldn't take a 5% cut in income because he has “a lot of bills.” The doc makes at least twice as much money as the average physician and has been in practice at least twice as long as I have. He clearly has a defense problem.
I also communicate with primary care docs, attorneys, veterinarians, optometrists, and others who owe $200k, $300K, or even more in student loans while looking at incomes in the high five-figure or very low six-figure range, often in a high cost of living area. These doctors have an offense problem.
If you are having financial issues, it might help you to characterize whether you have an offense problem, a defense problem, or both. Then you can concentrate your efforts on where you will get the biggest bang for your buck.
Moving The Ball Down The Field
In football, if you never score, you cannot win. The best you can hope for is a zero-zero tie. Now, I don't know about you, but I don't want to have a net worth of zero ever again (yes, I know there are many of you who would love to get back to a net worth of zero.) If you want to win the game, you've got to move the ball down the field and score. In the financial game, that means to earn money. Almost everybody in the world has an income, i.e. an offense, problem. The median income in the world is just $2,920 per person (~$10,000 per household) per year. That doesn't go very far, especially in any kind of a developed country. Even in the USA, median household income is around $50,000 per year. The easiest way for someone earning $50,000 a year to become wealthy is to earn more. That might mean going back to school to learn how to do something else, picking up some overtime, getting a second job, sending a spouse to work, or starting a business.
If you are a physician or other high-income professional with an income under $200,000, your main issue is also likely to be an income issue. You might consider doing one of the following:
Image Credit: Paul Cutler, CC-BY-SA
8 Ways to Increase Your Offense as an Employee
- Asking for a raise
- Picking up additional shifts or call
- Changing jobs
- Starting your own practice on the side
- Starting a non-medical business
- Becoming a real estate investor
- Moving into your own practice permanently
- Sending spouse to work/increasing spouse pay
15 Ways to Increase Your Offense as a Practice Owner
- Cutting work-related expenses
- Lengthening hours of operation
- Opening on Saturdays
- Hiring advanced practice providers
- Hiring employee physicians
- Raising rates for direct-pay services
- Moving to a direct-pay model
- Adding ancillary services
- Renegotiating insurance contracts
- Improving payor mix (i.e. stop taking self-pay, Medicaid, and Medicare patients and drop your worst paying insurance plans.)
- Seeing patients faster/more patients in same time period
- Ensuring top-notch coding and billing
- Start a side business
- Pick up some work as an employee on the side
- Sending spouse to work/increasing spouse pay
In short, there are many ways to increase income. If you are losing on the offensive side of the ball, consider which of those methods would be the easiest to implement.
Stop the Bleeding
However, the problem that most doctors have is a defense problem. To put it bluntly, they spend too much money. They “have bills.” Get rid of bills. You would be amazed how much less offense you need if your defense were shored up sufficiently. One field goal wins a football game if your defense is perfect. Think of all “the bills” you have now or may have later and what you can do to reduce them.
A Mortgage
Don't buy an expensive house. Put 20% or more down. Pay it off early. Move to a smaller house.
A Second Mortgage
Don't buy a second home or pay cash for it.
Timeshare Maintenance Fees
Don't buy a timeshare. Get rid of the one you have.
Auto Payments
Don't buy cars on credit.
Student Loan Payments
Pay them off right out of residency.
Retirement Savings
Front load them. Minimize investing expenses and maximize returns with a smart investing plan. It's possible to be done saving for retirement in your 30s or 40s if you hit it hard early.
Your Children's Weddings, Missions, Cars, Summer in Europe
Save them up in advance.
Your Children's College Costs
Save it up in advance. $10,000 at birth may grow to $10,000 per year of college later. If anyone goes into debt for college, it should be the student. Choose a cheaper school, get scholarships, work during school etc.
Your Boat/Airplane Payment
Pay cash or don't buy it.
Your Credit Card Bills
Seriously? You're a doctor and carry a credit card balance?
Alimony/Child Support
Avoid divorce if at all possible. Negotiate as low of payments as possible. Nothing keeps you from spending more on your kids if you like.
Taxes
Learn the tax code. Then take advantage of your knowledge. Do as much saving as possible inside tax-protected accounts- 401(k)s, Backdoor Roth IRAs, HSAs, 529s etc. A less expensive house has a smaller property tax bill. Buying less stuff lowers sales taxes. Working less lowers both income and payroll taxes.
Advisory Fees
Learn to do as much as you can yourself. Shop around. Renegotiate fees as appropriate.
Charitable Contributions
Give consciously, where you think it will do the most good and in alignment with your values. Don't be pressured into giving to causes you don't really feel strongly about.
Family Economic Outpatient Care
Give to your family because you want to, not because you have to. Learn to say “no.” Even if your culture is one where some EOC must be given, be sure the amount you're giving is appropriate.
Private School Tuition
Relocate to an area with good public schools.
Insurance
Insure only against financial catastrophe. Don't carry more term life or disability than you need. Cancel it when you no longer need it. Don't buy permanent insurance.
Notice I'm not talking about the usual personal finance stuff. The lattes, the dinners in restaurants, the new car etc. A high-earning physician probably earns enough to pay for the little stuff. If he has a defense problem, it's probably with the big stuff.
How To Tell You've Won
The end game, of course, is financial independence. When you have enough assets or income (they're interchangeable) that you no longer have to work. However, if you've figured out how to make $500K a year while spending $100K a year, then you have my permission to quit working on your offense and your defense. In the meantime, try to determine how much of your issue is offense, and how much is defense. If defense, go down the list of 17 “bills” I listed above and see how many of them you have. (I have four and plans to eliminate 2 of those 4 within the next few years. I've already “right-sized” the other two.)
What do you think? Do you have an offense problem, a defense problem, both or neither? Which of the methods of improving your offense seems most attractive to you at this point in your career? How many of the 17 listed “bills” do you still need to be paying?
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Boo-hoo.
As a doc (PhD, not MD) who made far less than most MDs before retirement, I have little patience. Yes, you have to pay those student loans, but you know that going in. Every piece of advice in this column is on target, but the problems show poor judgement and planning. You do have the cure backwards, however. In a trauma situation, doesn’t bleeding get treated first? If you increase your income, you pay more taxes. If you cut expenses, you get to keep all of the savings. All that education and a shortage of common sense, exacerbated, in many instances, by greed. We who ultimately pay those medical bills are not obligated to guarantee the practitioners the high life.
Many if not most physicians have poor financial judgment and planning, that’s a big reason why this site exists
@OLEDITOR
To go along with your self-described little patience it seems you have a wee-bit of bitterness and jealousy, too. I’ll give you the benefit of the doubt and presume it’s just a little green left over from St. Patrick’s Day…
And, no, he doesn’t have the cure backwards as you suggest. Sure, in a life-threatening trauma situation stopping the bleeding is a priority, but sometimes stopping it is a complex, time-consuming task — so you transfuse the patient to buy time so you can undertake the necessary intervention to definitively stop the bleeding. Likewise, increasing your income can allow you the time and financial flexibility to best definitively manage a spending problem.
I’m glad you raised the issue of poor judgement and planning. Many physicians are certainly guilty of such with regards to their finances, as you note. So, too, is someone who pursues a career path which leaves them evidently financially unfulfilled and embittered by the hard-earned success of others.
Actually, in a trauma situation, bleeding is not the first thing to address, but I digress. Luckily, I have neither a defense nor an offense problem at present. To continue to beat the analogy, it’s hard to win when your opponent scores 70 points in the first quarter (school loans, 7-11 years of no/low income) and continues to rack up points as you go (e.g. malpractice costs, license fees far above other professionals ($400/yr compared to my wife of $70, not counting $40/yr to write a Rx, $200/yr to write narcotic Rx, etc)).
Trauma situation-ABC’s: Airway with C-spine stabilization, Breathing, then Circulation (stop the bleeding). So actually bleeding is third. In WCI’s analogy, I see offense as the airway and breathing first.
Whutt?
Uhhh…okay. Thanks for stopping by. You do realize this is a blog aimed at HIGH-INCOME folks right? So we talk about HIGH-INCOME problems. These are the financial problems that high-income earners face. Yes, we all know they’re first world problems. That’s okay. We’re going to address them anyway.
I’m sure you were aware when you chose to go into a PhD field that you were aware that most PhDs make less money than most MDs, just like MD students know about the student loans. We all lie in the bed we made.
And no, bleeding doesn’t get treated first, but massive bleeding does get covered in the primary survey and there’s no reason someone can’t put direct pressure on the wound while I intubate.
The foundation of a good offense is built on a solid defense, if you make more but lose it as it comes in just as quickly you end not gaining any yardage yet feel like you are working harder than ever before. In a past post, there was discussion of burnout and this feeds fuel right into that fire.
Its just not wise for people earning in the top quartile to be living pay-check to pay check, its unfortunate that there are those that have chose to place themselves in situation for one reason or another to where if they had to take even a few months off they would not know how to make ends meet, because they are hemorrhaging.
At that point call a time out and sub some players if you have to, you’ve worked too hard not to win.
Great game plan. I am printing these lists for each of the kids!
As a dentist who started a bit late in the game. I am 20 years into my career and finally doing everything I am suppose to do. I paid off the student loans only to buy a practice.
Now I am paying down the practice loan as fast as I can. I am putting money away for retirement, paying taxes and tithing. Problem now is my kids are at a private high school and there aint much left (you and I differ in our view of public and private high school).
So now I have a great offense and unfortunately a pretty stacked defense.
I just think this is just where I am at for a spell. The loan will be paid off next year and that will let me breath a bit before the kids go off to college.
I just feel like if I put away more 20 yrs back then this part of my life wouldn’t have been so stressful. But such is life.
Good job paying off the practice loan and getting control of your finances. How much more will college cost than private high school? It seems to me it is often pretty comparable.
My biggest bills in this order:
1. Federal income taxes
2. Saving for retirement (3 fold larger than any other bill below)
3. Mortgage
4. Saving for the kids College
5. Disability and Term Life
6. School loan debt
If I could just eliminate these damn taxes!
same as you! Except I am still paying off 1 of the family’s 2 cars
Excellent lists; good analogy. Maybe basketball would have been the better sport to choose given what’s going on around us (Go Utes!), but I’m guessing this was written during football season.
I’ve “won”, claiming financial independence, but I still pay 5 of those bills. Retirement funding, taxes, college (529s), charity, and insurance.
If I follow through and retire in my mid-to-late forties, I’ll be able to stop funding retirement, college should be taken care of, and taxes minimized. Insurance will probably go up (health) and I’m already done with disability and term life. Charity is the “bill” that will see the biggest increase, according to plan.
Its psychological as well. If hes earning more than an average doc than he wont notice any changes whatsoever. A 5% income change wouldnt be noticeable after the income tax relief unless you were over leveraged to the hilt.
In concern for a slight downturn in my area this year (due to continued weakness in oil prices) I modeled a 20% decrease in income and it was something like a 5% drop in actual cash flow all things considered. Makes concern for seemingly large numbers over blown.
zaphod – how are you setting up your income model? i ask because after doing my taxes last weekend, i’m thinking about working less, making less, and paying a helluva lot less in taxes. but i am just not sure how to set that up in excel, etc
thanks ion advance
AD
Thanks to al the MDs who updated my 60-year-old Boy Scout first aid training. That does not change the reality, though. If you reduce expenses by $1,000, you have $1,000. If you increase income by $1,000, you’d be lucky to get to keep much more than half, depending on your tax bracket and where you live. Not to mention making it unnecessary to work extra hours and endure extra stress.
Envy, no. I had a fulfilling career (actually two) and live comfortably in retirement. My ex-wife and I paid cash for my daughter’s education at a pricy eastern school, because we thought financial aid should go to poor kids who need it to get a degree. Never burned out, and had no desire to retire in my 40s, even if it had been possible. Have a secure income enough to maintain my life style, and most of my expenses are predictable and manageable. Except medical — it’s not only a wild card, but one that seems to keep moving up in an economic environment where there is very little inflation. Go figure.
BTW, the WCI is doing a real service, even for those not in the medical field. I read several blogs and columns devoted to personal finance, and it’s one of the best. I know people in every vocation and profession who have difficulty managing their money and could learn from him.
I absolutely agree with your main point- that saving money gives you more bang for your buck than earning that same amount of money-mostly due to taxes, but also due to the fact that you need less for retirement by virtue of your now lower spending level.
Im never certain about this logic. If I lower my spending now to invest and become financially healthy, Im not necessarily going to carry that forward forever. It could be spending tucked away for later for instance. I certainly plan to spend more in retirement, or maybe it’ll be similar but on things like traveling in lieu of student loans.
Yes, it’s all individual, but for the most part, most people spend less in retirement than during peak earnings years, even with additional travel and health care costs. People don’t just change their spending habits after 30 years. If you were happy driving an Accord your whole life, you’re not going to feel particularly pinched driving one in retirement.
@OLEDITOR: Your first post definitely stunk of sour grapes, but your main point is right on. I am blessed to have incredible offense and pretty stout defense. Now that I’ve cracked the 39.6% tax bracket, I really see very little motivation to work harder to earn more, when most of it will get eaten up in taxes. I’d rather focus on improving the defense–as you said its a dollar-for-dollar savings on the bottom line.
33 yo Nephrology, 8 months of fellowship. My wife and I are 6 areas.
In good news to humble brag, today my wife and I reached BoA Platinum Honors level, which is awarded to those with over $100,000 in their bank. This is the exact opposite of earning status by spending on a credit card, or staying at a hotel brand. This is distinction status for SAVING, even though BoA is less than thrilling on its “perks”. It has been a goal of ours for a while and we have been diligent to get here. While we still have expenses and debts to pay off, it feels great to finally have 100K (excluding retirement) as emergency/home down payment/life change. I’d say we are trying our very best to play defense, and I am the best/worst player on the team.
I say this to encourage all physicians young and old to strive for Saving goals and rewards – not just SPG Award status 🙂
Congrats on your success. Feels good to hit the 6 figure club!
Now go for Vanguard Flagship Status.
That comes with all kinds of perks actually, most notably, 100 free trades a month when using Merrill. I have saved loads of money this way. Now we may not be (and shouldnt be) the demo that gets the most out of it but its still pretty nice, I save at least a few hundred dollars a year from this.
One of the best articles ever!! Will be checking the game plan regularly to make sure I’m on target. Currently 4 “bills” but will be 5 soon due to spouse med school debt. But that part will be tackled speedily thanks to her frugality and income. Of the 4, the biggest two by far are saving for retirement/early financial independence and taxes.
WCI’s book and this website should be on the medical school essential reading list!
Defense is #1
Without knowing how to live below your means, no amount of income increase will help. Also as another poster pointed out, thanks to taxes it is much easier to save $1 than it is to make $1.
Physicians make plenty of money. It is our choices that get us in trouble. Each and everyone one of us can have financial security very quickly. We just need to realize what is important in life. I promise you that living in a huge house, driving a fancy car, and sending your kids to private school is not it. Those items can cost millions and they definitely do not buy millions of dollars worth of health and happiness.
Here is an example:
Wake up, make a delicious healthy breakfast for yourself and the kids.
Walk or bike ride them to school.
Do some errands around the house
Read a little
Go to the gym and on the way home pick up some fresh groceries for dinner
Walk or ride a bike to pick up the kids from school.
Spend some time with the kids make sure they do homework and do some fun activity together.
Eat the healthy dinner.
Have more family time.
Off to bed for adult entertainment.
What an amazing and great day that costs almost nothing.
I think we all need to stop and realize what makes us happy and stop wasting our time and energy working for useless items of consumption.
Stop living the doctor lifestyle and just live to be happy.
MMM is that you? Or do you use the car to get the groceries?
No, I’m not MMM. I drive my car and I am a physician who is still working. I have been fooled like many of us that having a big house and a nice car is somehow important and will make me happy. Luckily, my mistakes where not massive ones.
Interestingly enough, I have found that as my defense has improved, I don’t need as much offense and now work less. I am actually much happier spending less money. Because I work less, I now enjoy work even more which also adds to my happiness.
Defense is #1
You only need more offense because you screwed up so bad your shovel just isn’t big enough to get you out of the mess you created.
I have to second @Alex and @OLEDITOR on this one. My live is amazing and full of the stuff that really makes us happy (including a great house, kids at big name colleges, travel, etc) but only because we focus on Defense!
As Andrew Tobias wrote, “A Penny Saved is Two Pennies Earned” (or 1.5 pennies or whatever the inverse of your true marginal tax rate is)… but the bottom line is that there is someone out there who makes less than you who is getting richer than you and is still just as happy. The difference is how s/he spends, not how much they earn.
@WCI – you may be only writing about the big ticket items in this post, but if you look at your own life/writings you are thoughtful/frugal about the small stuff as well. (Wakeboats included.) The thoughtfulness about all spending, big and small, allows you to consciously decide what consumer items truly make you happy, what vacation splurges truly make you happy, what lattes truly make you happy, and which ones are just a waste. No one is a perfect spender, but psychologically I think the people who can pick the smaller house, more efficient car, etc are also the ones who think twice about small purchases.
Semiretired PhD here (in a subject field–finance/economics–where many of my grad school classmates earn far more than MDs) and this comment thread really resonates with me. My late husband and I (both in same field–we met in grad school) consciously chose a lower-stress and happier and lower-cost lifestyle away from Wall Street. (By coincidence, we happen to live in the same small town where one of the authors of The Millionaire Next Door lives. We moved here before the book came out.) We have had some very high income years in the past but focusing more on defense rather than offense has brought a great deal of peace and joy in living modestly and sharing what we have with others, and is a tremendous legacy for our daughters. The value of the precious time my late husband and I shared together focusing on defense (figuring out ways to happily live modestly together as a fun challenge) rather than offense is priceless.
I will say that we are blessed to have some wonderful medical professionals in our lives and I am sorry that our current system of educating and compensating MDs and dentists burdens their lives with so many economic/financial concerns (paying off large student loans, paying for equipment and practices, dealing with billing/coding/etc.)
Lots of wisdom there.
Great article and some “tough love” for those who have a porous defense. Having a spouse with a good job is like having Payton Manning and Tom Brady on your team at the same time. Imagine getting two offensive drives for every one time the defense takes the field. It’s virtually unbeatable* and can allow you to survive private school, college funding, an occasional fancy vacation, and even a rare turnover (mishap).
We are into the fourth quarters of our careers and now run the ball a lot on “O” and are playing a lot of prevent defense, not needing to take many chances.
PS I love the football analogy and recognize this and other references to The Millionaire Next Door. 😉
No references were done on purpose in this particular article, but there’s no doubt it is an important work in the personal finance literature and I’m sure shaped my way of thinking long enough ago that I don’t even recognize when I’m referring to what it taught me.
Late to the comment party.
Excellent article Jim- this also relates to your own analysis/post of under-accumulators and over-accumulators of wealth, a concept from Millionaire Next Door, and how it applies to the Physicians. Here is a link your readers may find useful – https://www.whitecoatinvestor.com/a-net-worth-rule-of-thumb-for-doctors/
The Millionaire Next Door will cure anyone of their bad defense – if you want to be wealthy start acting like them.
Offense can be a lot of fun. The defensive tactics listed are more easily self-controlled. . A great place to start your offense is in initial salary and contract negotiation. Learn what you are worth and ask for 10% more. Another great offense is to stop undercoding. This is a pet peeve of mine. I see far too many docs do it. When my sister’s PEDS group switched to EMR they had their best fiscal year ever due to proper coding. My husband was so used to undercoding that he tried to figure ut how to bypass the coding in his EMR. Really? Stop that already. Start following your business numbers as closely as your personal. Addressing patient flow issues can allow you to see a few more patients without adding Saturdays or extended hours. Offense may not seem as controllable as defense until you give it a try. Saving that $1 is easier if you earn $2 to get it instead of $1.
Yup, might as well work on both ends of the game at the same time. Certainly increasing offense has made a huge difference in my life.
Great article. In our house, i feel like I’m playing both sides of the ball and the wife is the other team hah! I guess the one point I never quite understand is the rationale of not picking up extra shifts because of all you’d spend on taxes. In that case, why work in the first place if so much is going to taxes? I have a hard time splitting those two situations. If the end game is FI, extra work for more pay works towards that goal. Sure, not as much as cutting costs, but for most doctors, I’d think picking up one shift is not an insignificant amount of money, even after taxes.
An MD gets a late start in the investing arena and needs to sock away very much in those early years and should have started an IRA in residency
The biggest problem is not less income or more expenses; its the absolute lack of financial acumen of most physicians and we dentists. Just listen to others about their stock trading and other ventures. Silly stuff
EVERY DOC earns enough to be financially independent at 65-70′ if not they were foolish along the road
Every doc makes enough to be FI by 45.
Defense wins championships. I would say that applies here as well. Interesting analogy that really helps you identify a problem area.
I agree with ZB60 above – offense wins games but defense wins championships. Just about anyone can become financially independent if they adjust their expenses to be far below their income.
VERY FEW mds will be financially infdependent at age 45 no less 65 as most lack financial education and too many live beyond their means
3% of dentists retire comfortably at age 60 and mds start much later earning a buck
I think you two are talking past each other. Many/most MDs could be FI at 45 but very few will due to late starts, high burdens and mostly, high lifestyle spending.
mds start 30-35 how is it possible to be FI in such a short time not happenin\if you reach fi at 60-65 consider yourself a financial success
as a dentist very very few of us reach fi at that age
You do it by living way below your means. For example, if you’re frugal in med school and come out at 30 with $150K in debt and an income of $300K. You pay $75K in taxes and live on $75K. You use the other $150K to build wealth. In year one, you pay off the loans. In year two, you save up a down payment for your house. You now have 13 years left to put $150K a year away. Assuming you make 5% real a year on it, after 13 years you have $2.8M. That supports an income of ~ $100K a year for the rest of your life. You’re FI. $75K isn’t exactly a pauper lifestyle. Now, if a doc wants to live a little higher on the hog, that’s fine, it’s his choice. I’m just showing it is entirely possible to be FI at 45 as a doc if the doc so chooses.
Oleditor,
I think you’ve posted under a different name regarding the increase in licensing fees that WCI wrote about a few months ago.
Your first post was very disrespectful and I hope you either stop posting here or act in a manner that is consistent with your level of education.
Also, you make some irrational claims. WCI’s recommendations will NOT increase the cost of health care. If you look at his suggestions, most involve doing non-medical work and the others (such as taking extra call) are already part of what a hospital or group has to spend.
In addition, if you look at health care spending by percentage, physician costs are only 20% of the total national health care budget. The largest portion, about 30%, is spent on hospitals. The rest is divided among pharmaceuticals, nursing home spending, administration, etc.
Finally, you say that health care is one area of expense that is climbing rapidly. Well, I urge you to look at the costs of higher education (your fiels) and its rate of rise versus inflation. Would you appreciate it if I blamed the pensions that professors receive as the cause for this rise? I know enough about the issue that I won’t assign blame to one particular group.
Your comments are sad because your main point, saving diligently and living below one’s means, is an excellent one. It’s very basic but it’s critical and one that EVERYONE should follow, not just “greedy” physicians without “common sense”.
Jsong 23:
I don’t recall ever using different name on this site. Nor do I even recall the column re licensing fees. Since that would have limited impact on the public, I don’t know why I ever would address it.
I think you read too much into my comments. I never said — even implied — that physician costs are the only factor in rising health care costs. I certainly would not give hospitals or the drug industry or bad public policy a pass on this issue.
And the waste I saw in 25 years in higher education would probably surprise even you. But the waste is not primarily in faculty compensation, it’s in bloated administration, taking on new responsibilities that need not be part of colleges, athletics, which rarely pay for themselves even at the biggest schools, decline in state financial support — I could go on and on. The statistics showed that during my time there, professor salaries rose at less than the COL many years. In addition, college administrations are cheapening the quality by using far too many low-paid adjuncts. The amount adjuncts are generally paid is shocking. It’s not part of the subject matter (except possibly med schools) on this site, but I would be happy to share my experiences and insights with anyone who inquires. We can ask WCI to allow us to trade e-mail addresses. Disgust with poor administration was a large part of why I retired when I did, since I loved teaching. And I can assure you that I was persona non grata with some administrators, because I publicly objected to it.
FYI — I have never participated in a pension plan. The 403b common in higher education is similar to a 401k, but at many institutions, the employer contribution is pitifully low. Also, I might note on several occasions I have commended the WCI for his suggestions on personal financial management, a subject not exclusive to docs. That is why I read his stuff, and skip the columns that apply to only docs. He and I have agreed to disagree on a few issues.
It is not really part of this thread, but I personally think the health system in this country is broken. It has not affected me — I get great medical attention for the few problems that I have encountered thus far. I have not spent the night in a hospital in over 70 years, so I don’t have much experience in that aspect. But too many people don’t get adequate care, and you have heard the reasons. Docs could be a powerful force in reforming it, if they got together on it. The answer is not doing more pro bono work (though I respect those that do), it’s devising a system that adequately compensates all players and assures good care for all. But driving expensive cars (not the WCI) and living in houses far larger than most well-educated professionals can afford or need (I don’t even want one) sends the wrong message to the public.
I am sorry if you find my frank comments offensive. I will admit, not being a physician, I don’t have the inside knowledge on what drives the costs incurred by the docs, though I know such things as protection from litigation, complicated record-keeping and billing systems, outrageous drug prices contribute. I hope that in the future, docs will be part of the solution, not the problem.
That said, I am not offended by your disagreement, though I think you do me wrong on the issue that opens your comment. Open discussion is vital to a functioning democratic society, and I don’t want to get into politics today. Wrong place as well as bad time.
You may not recall using a different name, but the poster is correct that someone at your IP address using your email address used to post here under the name H. Fullerton. I don’t see any comments on the post about the Utah Doctor Tax/Licensing fees from you, but you left lengthy comments on several posts including:
https://www.whitecoatinvestor.com/its-not-just-our-tax-system-that-is-progressive/
https://www.whitecoatinvestor.com/top-16-reasons-it-sucks-to-have-a-high-income/
https://www.whitecoatinvestor.com/loosening-the-purse-strings-part-2/
along the same theme as your comments in this post. That’s probably what jsong is referring to. It’s easier to keep track of posters when they use the same name in each comment, so I’d recommend picking one or the other and sticking with it to facilitate discussion.
How careless of me to not remember everything I did over a year ago! Wonder what I had or dinner that day. . . Must be getting old. Retirement (at 68, not 45) may have made me mentally lazy. Cheers.
One of the very large costs of healthcare goes towards bureaucracy.
Look at any physician’s office and see how many people in that office have nothing to do with patient care but are responsible for documentation, billing, collections, fighting with insurance companies, pre-authorization forms and so forth.
Look at a hospital and see how many people there have absolutely no role in patient care but responsible for copying with regulations as well as the billing, coding, fighting with insurance company thing.
Add to it the lack of transparency, fear of litigation, and the strangle hold insurance companies have on the practice of medicine and you will clearly see why costs are so high.
Also, a massive cost of healthcare is end of life care. People half dead on machines with a family that refuses to stop. People that are essentially bedridden vegetables and the family will not give that patient the dignity of death. Many studies show end of life care costing 25% of the health care expenditure. It costs us $50 billion to care for the last two months of people’s lives every year.
BTW, a physician sacrifices years of their life to be able to do something very few people on this planet can do. I see no reason why they shouldn’t be payed highly for their rare commodity of knowledge. Simple supply and demand would dictate that doctors should be paid more than some other professions.
Also, keep in mind if you want some of the brightest people in the US to become doctors, they need to see some form of reward for all the sacrifice and hard work they will be putting in. Otherwise they might as well become bankers and programers.