I will be the first to admit that I have a soft spot in my heart for any physician writing on financial or business topics. As such, I was pleased to receive several review copies of Brandon Bushnell’s A Doctor’s Basic Business Handbook: Things I Wish I Had Known When I Got Started. I had the opportunity to read the book on a recent long road trip. Actually, I read the entire book over about 75 miles between Holbrook and Payson in Northern Arizona. There are just 68 double-spaced pages in this introductory book on a variety of physician-specific financial and business topics. He includes a list of additional resources at the end of the book, including The White Coat Investor: A Doctor’s Guide to Investing.
I really enjoyed the book, and not only because it was short enough that I could finish it before sunset on the same November day we explored two national parks and donated $20 to the Navajo Nation in order to pose for a picture at Four Corners. In the introduction, he mentions he developed most of the book as part of the curriculum for the Winter meeting of The Arthroscopy Association of North America. As I read that it dawned on me that I had heard Dr. Bushnell speak last Winter, at Snowbird, the ski resort up the road from my house. You see, I snuck into a session of that meeting at the invitation of his co-speaker, Tom Martin, who is not only Dr. Bushnell’s financial advisor, but also a principal at Larson Financial. [Disclosure: I’ve done some paid consulting for Larson and they’re a paid advertiser on this site.)
Yes, that’s correct, a medical group held its meeting 8 miles from my house, included a financial lecture, and didn’t invite me to do it. Why my speaking invitations seem to always require two days of travel instead of 12 minutes of travel and an afternoon in the powder is beyond me. I probably would have done that one for a couple of lift tickets instead of my usual multi-thousand rate. I’m not sure what Dr. Bushnell got paid to speak, but I’m confident Larson Financial made out well judging by the number of orthopedists rushing to sign up with them after Bushnell’s enthusiastic endorsement. The entrepreneur in me has to acknowledge that as a brilliant marketing move, but more on that later in my single criticism of the book. First, let’s talk about the many things this book does very well.
A Primer On Negotiating Contracts
I think every doc owes it to himself to read a book on contracts (preferably a specialty-specific one) at the beginning of his final year of residency, and re-read it every time he changes jobs. The first chapter of A Doctor’s Basic Business Handbook is all about contracts. It isn’t quite as much as you’ll get out of a book dedicated to the topic, but it’s a darn good summary. It covers almost all of the important points, such as term, termination, pay and benefits, enforceability, restrictive covenants etc. If he had briefly touched on the importance of malpractice coverage (specifically who pays the tail) it would have been perfect. The best part of the chapter, however, is at the end when he talks about negotiating, especially the importance of the BATNA- Best Alternative To a Negotiated Agreement. Far too many doctors just don’t get this. The way you “win” a negotiation is by having another great offer that you’re willing to take, and playing them off each other. Bushnell says it like this:
The BATNA is your proverbial Plan B option if things in the negotiation simply do not work out between you and the other party at the negotiating table. If you are negotiating an employment contract with a potential employer, then your BATNA might be a job with another employer in the same market or in another town. If negotiations are not going your way, and you know that your BATNA is perhaps a better deal than the one developing at hand, then you can confidently walk away from the negotiation. On the other hand, if you don’t know what your other options could be, then you hold a much weaker position in the current negotiation.
One party always has a better hand in any negotiation. The way you make sure you have the best hand is to make sure you have another option acceptable to you in your back pocket. Then you have all the power- they either meet your demands or you leave. Either way, you win.
One place in which this book particularly excels is that nearly all of the examples used and advice given is 100% applicable to orthopedists. A doctor of any other specialty can still apply much of it to his own situation, but I learned a ton about the business of orthopedic surgery while reading it. For example, one of the things I never knew (and you surgeons are going to laugh that I didn’t know this) is that there are procedures that insurance companies will only pay for if you do them in the hospital and others they will only pay for if done as an outpatient. Of course, those lists are different for different insurers, so be sure to be familiar with the lists for the procedures you do and the insurances you take, lest you find yourself not getting paid because you did the right work in the wrong OR.
You should also realize that Dr. Bushnell looks at life through the eyes of an orthopedist, so don’t feel too offended when he throws out figures like $500K a year for a brand new residency graduate and $5000 a night just to take call. We all write from our own perspectives, I suppose, but an acknowledgement that the average physician is making less than half that (and not getting paid at all to take call) may go a long way with some readers.
Industry and Hospital Relationships
I really enjoyed the third chapter, which is about establishing proper relationships with industry and the hospital. This is something I rarely see discussed in financial books, even physician-specific ones. Granted, this is a far bigger issue for orthopedists than for emergency docs, since I can’t seem to find a drug rep for Keflex and Percocet to come buy me lunch. This chapter contains a great discussion of Stark Laws and Anti-Kickback laws (and no, they’re not the same thing.) It also discusses the relatively new Sunshine laws (you know, the ones that report online the $12 lunch someone bought you and the $20 you got for doing a survey on Sermo.) The last part of the chapter is about the medical staff, with three pages discussing how to get paid to be on call. No wonder orthopedists are usually the first specialists at a hospital to get paid to take call.
Coding, Billing, and Pricing
I also enjoyed the fourth chapter. It’s always tough to write about coding and billing in anything but your own specialty, but I thought the book did a pretty good job on a tough topic. It was fairly procedure heavy, and didn’t go into as much detail on Evaluation and Management codes as I would have liked to see, but again, I learned some things about coding procedures I didn’t know previously. (By the way, excisional debridements pay a lot more than incisional debridements.)
Marketing Your Practice
The best chapter in the book is the fifth and final one, about marketing your practice. It was excellent, especially his first point. This is another one that is completely true, but far too few doctors realize it. He says step # 1 is “Be Nice.” As someone who refers patients to a doctor a dozen times a day, what he says is absolutely true. Treat me like a jerk when I need help in the ER and you’ll find yourself only getting self-pay, drunk jerks who threaten to sue everyone (while the nice, sweet-smelling, insured folks go to the other group.) The whole chapter is filled with pearls.
My Sole Criticism
The second chapter, on personal finances, could use a lot of improvement. It read like the typical doctor-specific finance book written by a financial advisor, rather than by a doctor. While I thought tip # 1 (Don’t act rich) was right on, the rest of it was pretty much useless, lacking any specific advice. For example, the paragraph (yes, a single paragraph) on Debt Management didn’t mention refinancing, IBR, PAYE, REPAYE, or PSLF. The Investing Section (two paragraphs) didn’t even really mention anything about investing except that you should hire an advisor to do it for you. In fact, that is a major theme of this entire chapter. I suppose that’s fine, since 80%+ of physicians not only want a financial advisor, but probably should use one. The problem is, if the main point of your chapter on personal finances is “Hire help” you ought to spend a significant amount of time teaching people how to do so. I think this may be a result of Dr. Bushnell’s experience. His advisor, Tom Martin, while nowhere near the least expensive option out there, is a pretty darn good advisor.
Perhaps Dr. Bushnell assumes that most advisors are like Mr. Martin. Unfortunately, hiring an advisor giving good advice at a fair price is far more difficult than one would assume after reading this chapter. In many ways, by the time you know enough to recognize a good one, you know enough to do the work yourself. This chapter could have been dramatically improved with a lengthy discussion of how to hire a good advisor, an acknowledgement of the fact that good financial advice is expensive, even when offered at a fair price, and perhaps even a discussion of the fact that it is possible to do much of it yourself with an appropriate amount of discipline, interest, and easily acquired knowledge. I also think it probably would have been better if he had disclosed that the book he enthusiastically recommended on page one of the chapter was written by his own financial advisor and speaking partner, but there was certainly no legal requirement (and many would argue, no ethical requirement) to do so.
While any regular reader of this blog can skip the entire second chapter, the rest of the book more than makes up for it making the book well worth the price of admission (<$15 and 2 hours.) To make matters even better, Brandon sent me five review copies, which were given away to readers who posted comments within a few days of publication of this post.
[Update 2/23/16- Drawing has been held. Winners have been notified. The rest of you will have to buy it!]
If you didn't win, buy A Doctor's Basic Business Handbook on Amazon today!
What do you think? Have you read the book? What do you wish you had known when you left your training? How did you learn how to interact with industry and the hospital? What do you do to market your practice? Comment below!