Tuesday, July 3, 2012

Obamacare vis-a-vis doctors' finances

Now that the Supreme Court let the Obamacare stand, one burning question that I have is this: what does it all mean for the doctors' bottom line?
Many currently uninsured people will get coverage- I guess, that's a good thing for that bottom line? (it would be in a free economy, since there're millions of consumers of goods/services appear out of a thin air)

The only trouble is that these new consumers will be paying their 'bills" with OPM (others' people money), representing a tax on those who do pay them ( about half of the US population, incl. most doctors). This tax can take different shapes/forms(overt increase in taxation or creating newer taxes/covert taxation by increasing inflation etc), but will have to be paid neveretheless. From my MBA course I know that taxes are beneficial only if they create more wealth that the actual tax extracted from the economy ( does it ever?).
It seems unlikely to me that with all the governmental inefficiencies and outright fraud we're witnessing now within government plans that  it would truly create more wealth for the economy than it would extract from it.( just my half-educated guess).

Thursday, June 7, 2012

Your salary. Your life.

I'm sure most of us met quite a few burnt-out, disenchanted and disinterested docs. All that makes them go through their clinical routine is their paycheck.
They (and a lot of their more cheerful colleagues) are trapped in what we can call a high wage trap: despite of being utterly dissatisfied with their current situation they make a decent salary, and to start something new and (possibly) exciting, which may or may not lead to a higher income, is outright scary, since we all developed a high dependency of this paycheck. Most of us would never go for it, because the more you earn, the more you have to loose. However, in a great scheme of things it's your life experience that matters (or should matter).

It's much easier to start something new when you really have nothing...

Wednesday, May 30, 2012

Salaried position vs. your own business

The deeper I am into my MBA course, the clearer I understand for myself that starting and running a business is... well, a serious business ( I am waiting for those "doh"s..)
No, seriously, if , in perfect or near-perfect competition all you can count on is so called "normal" profit (by definition, it's enough profit to attract capital investment to your business), i.e. NO economic (that is, real in lay terms) profit, all this means to you is that you're just trying to keep your business running without slipping way into the red/bankruptcy etc.
That's it. (and, by the way, that's most small- and medium-size businesses, incl. doctor's practices). And all this comes at a great expense in terms of time/effort investments. ( and, obviously, money). It's a rat race , too, just a different kind. ( and I skip all this silliness about "being your own boss" because you are always under some sort of constraint- most of the time, financial, so it's not like you can do whatever you feel like). Becoming a near-monopolist (FedEx or UPS) has a bit of an entry barrier, like $2 bln.
So one needs to be truly passionate about it to start it and continue doing it.
On the other hand, if you have what you think is a brilliant idea (Facebook?), I would probably just go for it. Because I see it as one of the few (if not only) chances of making it big.
So... what do you think?

Tuesday, February 14, 2012

More money and a managerial paradox

I blogged some time ago that I switched jobs and now it is 50% clinical and 50% administrative (or "leadership"). Now, what they call in business world the "economical profit" (i.e., my current salary minus the "opportunity cost", or what I could've been making at my old job) is pretty good. However, the added hassle/more time spent dealing with staffing/patient complaints/organizational etc. headaches (not even mentioning political undercurrents and interdepartmental "bad blood"), the need to be constantly (i.e. 24/7) available to resove petty/small/medium-size/large issues... Is this"economical profit' worth it?
On one hand, sure- it's more money in real terms. Also a potential to earn more money thru advancement at later stages of your career. More interesting ,too, I guess, at least the level of the problems I'm supposed to solve. More flattering for your ego, yeah! ( you are "da boss" after all, you've made it!)
But all this leads to almost no ( and I mean it) free time- even when you're "not working" you still are- trying to figure out solutions to issues/schedules/research ideas/fend off hostile attacks etc. (Speaking of solutions, I found that most of them are only temporary). So kids get no attention. So is your spouse. So is your other small piece of life outside your working realm which is supposed to be used to enjoy the fruits of your bigger piece of life consumed by work. Add to this a tremendous increase in stress levels. An lack of attention (due to lack of time) to management of your investments ( I think it's possible to assign a sort of "negative cash flow' numbers to all of the above if nothing else, as a crude denominator)
At the end that "economic profit" shrinks, the question is by how much.

Tuesday, January 17, 2012

MBA for doctors, part 2

So I'm now well into my 2nd year of the MBA experience. So far, so good, the trouble is that I cannot really imagine what the experience would be had I've been at some renowned school, like Kellog or Wharton.
But the courses are useful- Corp. Finance was the most interesting, and before that -Management was very useful in practical sense ( since now my position is somewhat managerial; I will try to write on the art of managing people some other time).
So far, my understanding of how bonds/stocks are valued improved quite a bit. However, I don't think it will have any influence on how my retirement money are invested. My notion of passive, low-cost investing was strenghthened by seeing just how much time and effort a dilligent professional investor must spend to find suitable investments, and often she or he still picks a loser!