Are you a good listener?

I am better at it than I used to be but have a long way to go. It is hard breaking old bad habits. And being a surgeon does not help. This happened frequently when my children were growing up. I wanted to get the gist and to the bottom line quickly without any waste of time. So, my prime concern was for my own time as I saw my anxiety rise with each second and a strong itch to interrupt and ask “So, what finally happened?”

The latest thing is being distracted with an email, text or your phone making it impossible to give the other person a fair hearing. The link below correctly explains that as we listen we are simultaneously “in our head that is constantly judging, evaluating, criticizing, analyzing, and editorializing everything that we hear.” For me, I am already trying to get ahead and formulate a response or if I know the person I think I know what he or she is going to say!

So, there are good strategies in the article on how to be a good listener.

Why do you need to be a good listener? Many reasons especially if you are leading people. If you want to be understood, you have to try and understand others and for that to happen you really have to listen.


Top ten innovations coming in medicine

Consulting firm Deloitte has it’s take after surveying leaders in healthcare. They think the areas where progress will occur or is already occurring are : Aligning financial incentives, Rise of consumerism and Data privacy, security, and interoperability.

The top ten innovations are:

1.       Next-generation sequencing (NGS)

2.       3D-printed devices

3.       Immunotherapy

4.       Artificial intelligence (AI)

5.       Point-of-care (POC) diagnostics

6.       Virtual reality (VR)

7.       Leveraging social media to improve patient experience

8.       Biosensors and trackers

9.       Convenient care: Retail clinics and urgent care

10.   Telehealth

Popular innovations that didn’t make the list: Gene therapy, Regenerative medicine, Robotics,

Concierge practice for surgeons?

You have heard about Concierge medicine or boutique practices of course.

But, we think it is for primary care physicians. Some think it is time for surgeons now to jump into the pool.

The attraction is 24/7 ‘top’ surgeon access. The company is starting with spine care with a $99 annual fee giving a statewide list of a guaranteed appointment within 2 weeks from a statewide network. A VIP fee of $495/year gets you an appointment nationally within a week and a phone number of the surgeon.

Full concierge service is $2500 per quarter to 24/7 global and national coverage and access via text/email, a personal assistant to schedule, a rehab program for spine surgery etc. The company has 16 surgeons signed up covering orthopedic sports, spine surgery, gynecology and robotics procedures.

Again, time will tell whether there are enough patients who can afford the service as well as enough ‘top’ quality surgeons who have time to provide 24/7 coverage. Concierge service for primary care has worked to some degree. In the link noted, the PCO provided a hybrid model with a $1000 annual fee for patients aged 36-64.

For physicians fed up with EMRs, rushed visits, hassles with insurers and rising overhead, it is certainly an option.


The MACRA problem for physicians

Medicare is on steroids trying to base reimbursement for physicians tied to quality of care (value based payments) delivered despite there being no real empiric measures yet scientifically validated. The other object is to force closer cooperation with hospitals.

In the proposed rules (MACRA), physicians will have to bill under either merit based incentive based system (MIPS) or alternative payment model (APM). MIPS will probably apply to a majority of physicians and the first performance period when it will apply will be January 1st 2017 although the program goes into effect in 2019. The risk may be up to 4% the first year but could exceed 9% a year later. CMS says that about 761000 physicians will be eligible for MIPS and between 30,658-90,000 will be exempt from MIPS and be able to participate in APMs. MIPS components include: 50% for quality (PQRS & VBPM), 25% for something that will replace ‘meaningful use’, 15% for clinical practice improvement and 10% for cost.

Physicians will increasingly be held responsible for in-patient hospital spending!! The idea is that it is physicians who cause the hospital to spend the $! Although APM will have more flexibility, the standard for eligibility will be stricter than MIPS and necessarily involve being part of an ACO.


Is your head spinning with all the new acronyms? We will need to hire translators to understand the new language. Maybe we need to get together and form a consulting group to make all this understandable?


Some risk measures in investing

Some people have compared a portfolio to the waves of the ocean in terms of volatility. The view is that if you own one or a few individual stocks you could lose it all (unless you are lucky or King Solomon) so you should diversify to allow investments to remain stable like the still water beneath the waves. This is why the traditional advice has been to reduce equity holdings as you age in favor of stability i.e. bonds or bond like investments.

I have described previously the application of standard deviation to investments. As a general rule, returns in the future on average fall within one SD 68% of the time and within three SD 99% of the time. As Larry Frank author of the book, Wealth Odyssey explains: “A portfolio has $100,000 in value (75% short-term bonds, 25% stocks) and a 6.29% standard deviation. Most of the time (more precisely, 68% of the time), the portfolio likely will go up 6.29%, down 6.29% or any point in between. It means at least $93,710 ($100,000 minus 6.29% of $100,000) of the portfolio is unaffected. And 95% of the time, $87,420 of the portfolio value is intact. The waves might go down three standard deviations, 18.87%; still, $81,130 of the portfolio is fine.”

I have also mentioned the Sharpe Ratio (how much return you are getting in exchange for the level of risk you are taking). The higher the ratio, the more an investor is compensated for the risk. If you go to it lists, you can find it under a fund's "Ratings & Risk" tab. This is another measure that will help in assessing risk. Of course, it has downsides also. For one, it is a measure of past performance only and second when returns are low or negative in comparison with Treasuries, the ratio is hard to interpret.


New era for financial advisors

Financial advisors are never free. Most of the time the fees/commissions are either not disclosed or are more than the client estimates.

The so called 'fiduciary' rule issued by the Labor Department (1,028 pages of which 208 pages define what a fiduciary is!!) is meant to require brokers to act as fiduciaries, meaning they have to give advice, which is in the best interests of the client and not simply offer 'suitable' advice. This will be followed by lawsuits as billions of dollars hinge on this rule for brokers and advisors. Sounds great but many experts say that it is watered down so that fine print in the contract with the advisor may allow previous behavior. Apparently, 317 pages are about a 'best interest contract exemption' which allows actions not favorable for clients. Besides, a lot of provisions in the new rule do not go into effect till January 1st 2018.

Fee based advisors charge an hourly fee or a fixed percentage (often 1% of assets under management but one has to be sure that small commissions are not thrown off by mutual funds or insurance policies. If a advisor acts as a fiduciary, they have to disclose this to the client.

Recently, several 'blind' spots were detailed about perceptions from the client and the advisor's perspective. .

Best advice is to get a good referral, screen advisors an d insist on full disclosure.

Preparing physicians for leadership positions.........................

This article of mine was recently published in THE major physician leadership society's journal this month. The link is here:

and a recent national newsletter;

The point is what has worked so far (picking the best clinicians to leadership positions) may not work often due to the complexity of the new environment and the lack of necessary new skills required to lead health systems.

Hospitals and health systems are just starting to play catch up by trying to train physicians with these new skills. 

Will private practice thrive?

It depends.

You have heard that line before! It depends if the playing field evens out. It depends if the Federal Trade Commission has a spine. It depends if physician groups coalesce into moderate to large groups in order to compete with health systems. Etc. Etc.

I have laid out some thoughts here

What will interest rates do??

Importantly, almost all financial experts have been wrong about interest rates going up very soon. I remember the conversation with my advisor almost 8 years ago. Luckily, I did not listen to him.

Understanding how interest rates work is important.

If you want to get into the nitty gritty of interest rates here is a very good discourse on how interest rates work

Here is the link:


Problem with financial incentives for physicians

Incentive or performance pay has been a common tactic in the business world to entice workers mainly the sales force to increase productivity. The pay for performance (P4P) language started becoming common in the medical world a couple of decades ago. Certainly, private practice and increasingly now some academic practices have incentive bonuses for productivity in employment contracts.

I am more interested in the macro environment in healthcare rather than individual employment contracts although as I have argued, there is a powerful conflict sometimes between institutional versus physician interests if incentives are not aligned. See “Physician incentives may not be aligned with their health system employer. What is a physician to do?” at

There are some positive and some unintended consequences of incentive pay in medicine. Now, we are migrating from productivity pay to quality based reimbursement and compensation.

An older Harvard Business Review article  lays out some interesting arguments on this topic arguing that incentive plans cannot work. The author points out that research shows that incentive plans do work but temporarily. They change behavior only while the incentives last and that the work output is not any better. At the executive level, the author says, there is often a negative correlation between pay and performance! The points they make are: rewards ignore the reasons for the behavior desired, discourage risk taking and rupture relationships.

Do these conclusions apply to medicine? Who knows? Reach your own conclusions.

Hospital mergers & acquisitions in 2016

A survey of 250 healthcare executives about mergers and acquisitions for 2016 revealed some interesting thoughts.

·         41% say the growth will be via mergers and acquisitions (M&A) rather than growth of the organization through internal efforts.

·         60% are optimistic about financial results for 2016 compared to 35% who say performance will be the same and 5% predicting weaker results.          

·         The majority say implementation of the ACA aka Obamacare and regulatory scrutiny will be top challenges.

·         36% estimate they will benefit from ACA whereas 38% see no benefits.

·         Almost 90% anticipate greater capital needs than in 2015.

What is driving this? The realization that developing competencies to deal with value based payments and managing population health as well as managing cost will be required. So, they see partnerships through M&A with experienced entities to lead them through 2016. Smaller entities are increasing participation in M&A. For instance, in approximately 40% of the transactions announced in 2015 the target acquisition had less than 100 beds.

McDonaldization of medicine

Interesting post by Ray Dorsey in JAMA Neurololgy. If you are like me you will not have come across a neurology journal here

The authors relate what we all see around us: the "principles of the fast-food restaurant—efficiency, calculability, predictability, and control" applied to medicine.

They take each of these four principles and point to problems when applied to medicine in the extreme. No one (at least rational) will argue that we need these principles to challenge us to aspire to be better but taken to the nth degree, what are the consequences?

For instance they say that efficiency taken too far may lead to long lines and mistakes by workers pushed to do more with less leaving patients at a loss. Calculability or emphasis on numbers taken too far may shift the focus from humanistic care to speed. Predictaibility as per Demling may lead to a predictably mistake free car but what if individual patients require more or less time to solve their problem? Finally, controlthrough technology has the possibility of generating more precise data to allow better modeling but at what cost? Physicians are already unhappy at the enormous time spent on their computer rather than looking at patients, who are similarly upset at being objects rather than persons.

The article is however an emotional piece. True but lacks real solutions. As long as the healthcare system is led by people who are not accountable to the people and there is lack of transparency, patients and physicians have little say. Part of the solution is both stakeholders pushing to be in control and be at the table in decision making to make sure their voices are heard in the jumble of technology and finance.


Big losing deal for hospitals, but what about physicians?

Part of the reason for health systems buying physician practices was the Medicare payment differential between HOPDs ( hospital out-patient departments) and HOPPS ( hospital out-patient prospective payment system). Previously and until December 31st 2016, hospital bought physician practices (off-campus) were paid under OPPS but after January 1st 2017, they will be paid under the ambulatory surgical center prospective payment system or medicare physician fee schedule.

Whats the big deal? Hospitals were paid a higher amount (differential) under OPPS. So, for the same service physician offices were paid less. This is millions of $ less for hospitals owning physician practices. Health system excel spreadsheets showing revenues were partly based on this differential.  Imagine, if this reduces Medicare costs Congress could eliminate ALL differentials based upon site of service. Private insurers will follow. UHC has already announced they will not pay for HOPD services if there is a cheaper alternative nearby (physician office).

So, what does this mean for hospital employed physicians? First, some specialties have shown decreased production (wrvus). Second, their compensation may have continued to increase partly based on the site differential in collections. If this is now gone, what happens?Fortunately,  a lot of physician practices are on campus and should see no impact. If your practice is 'off-campus' and it is being considered for acquisition see if there is a possibi,llity of being within 250 yards of the main hospital or facility. If the practice cannot move close to the main  campus, it can be still be provider based if it is within 250 yards of another remote in-patient location such as an affiliated hospital (but with the same name and control of the health system). Another option is to just move your ancillaries to campus for the higher reimbursement and leave the office practice as is.

I suppose the bigger point is that I see the world changing over the next 5 years when budgets become really tight. I have said from the beginning of the spree of acquisitions of physician practices that you must leave the back door open.


Why baby boomers may come up short in retirement? Call your doctor!

It is common knowledge that most Americans have a big gap between what say what they want and what they do to get there. This is also true of 'baby boomers (those of us born like me between 1946-1964) in particular.

Blackrock a popular financial management firm reported results of their survey of 30,000 people worldwide (including 4,213 Americans)showing most Americans are holding twice as much cash as they should while planning for retirement. Yet, 3/4 still maintained they are well on their way to security in retirement.

Retiring Baby Boomers claim they will have an average of $45,000 in annual income in retirement but their portfolios reveal they will only have $9129 annually, a staggering gap of $36,371! Worse even the really wealthy, those with over $250,000 income annually in retirement, were short of their own assessment of what they intended to spend in retirement. Now, add the fact that interest rates are close to zero and if this persists and one has a large amount in cash/bonds, what does that do to future plans?

Everyone recommends having savings in cash or other liquid instruments to support living for 3-12 months depending on who you listen to. So, beyond this, it must be that baby boomers are scared of the recent market swings and do not what to invest in the equity market and some have 70% or more sitting in cash.

Question is: Does one continue to lose to inflation specially if the quantitative easing continues, interest rates at < 1-2% or dip your toe in equities? No one has the right answer of course. Even experienced investors abandon their asset allocation models ( ratio of equities to bonds to cash) when they are spooked and then jump back in the market at the worst possible time. That is why a lot of individual investors holding stocks and mutual funds do much worse than the average return on the same stocks/funds that are held without selling.

All I can say is stick with your asset allocation model with minor tweaking as you age and don't take jerky, emotional steps. If you need a tranquilizer every now and then, call your doctor!!

Doctors not providers. Why is that?

Why the shift from being called the time honored 'Doctor' to 'Provider.'

Part of it is the entry of other 'clinicians' like nurses, optometrists, therapists, physician assistants who are part of the team and getting reimbursed also by insurers. As marketing pros will tell you, there is a  lot to the name. Any way you look at the name 'provider' it is a huge step down for physicians. Makes you feel like you are lumped with providers of utilities, lumber and the like. I do not recall organized medicine or almost any specialty society seriously objecting to the term 'provider' when it was first used. You snooze, you lose, right?

Our physician leaders are now also using the dreaded 'P' title for their colleagues!

How about a little push back? Maybe it is a little late but try anyway.

Don't look up, respond or acknowledge the term when it is mentioned and pretend they are talking about someone else down the hall.

If it is written in a document such as a contract or even an email, cross it out and use 'physician' instead. A fall back position is the descriptor 'clinician' although nurses and physician assistants love to be called clinician.

If you are called upon such as 'Providers please raise your hand' don't. If questioned, say you are a physician.

In one on one conversations  correct the other person to use the right term.

If something requires your signature under the name 'Provider' cross it out and replace with 'Physician'

Suneel Dhand on his blog site ( remarks that almost no where else in the world is a physician called a 'Provider.'

If I was a conspiracy nut, I would probably say that this is a deliberate move to take down the physician ego down a bit more.


Common on, let us all do this minor passive aggressive act!

Holding physicians accountable for cost of care?

Holding physicians accountable for quality of care and outcomes is understandable. But, should we be held accountable for healthcare costs also?

Paul Keckley, PhD, managing director of the Navigant research center, which conducted a recent study with the American College of Physician Leadership states "Physicians want to be accountable for the elements of care that they can control,” Keckley says. “But what frustrates physicians is where they’re held accountable for things out of their control.” What he is saying is what we all know to be true.

If patient's do not lose weight, do not take their medications as instructed, eat what they want, do not exercise, continue to smoke, drink or use drugs, should their physicians be held accountable?

The survey reports that 69% of physician leaders say we should be held accountable for costs of care, in addition to the quality of care. Remember, that the survey respondents may not be front-line physicians, though. Nevertheless, some costs are directly related to the physician and his or her treatment plan.

Cutler and colleagues from Harvard report that "35 percent of end-of-life spending, and 12 percent of U.S. health care spending, are associated with physician beliefs unsupported by clinical evidence." For history's sake remember that David Cutler is the Harvard health economist and advisor to President Obama's 2008 campaign, who wrote a memo in 2010 arguing that the White House had the wrong team in charge of health reform and advised them to completely overhaul their implementation strategy! They did conclude that financial considerations and malpractice fears played a very minor role and pressure to please patients and their families had modest influence on treatment plans.

Truth about the medical device tax

The Patient Protection and Affordable Care Act (ACA aka ‘Obamacare’) imposes a 2.3% tax on the manufacturers and importers of some medical devices, which is expected to generate almost $30 billion in tax revenue from 2013 to 2023. These $ are used to subsidize Medicaid expansion and insurance exchanges.

The ACA and later the IRS has exempted some retail purchases such as glasses, hearing aids, and contacts, some over-the-counter products, tests and durable medical equipment, prosthetics, orthotics etc.

The lobbying by medical device companies to the tune of > 30M$ has been directed to bipartisan support in Congress tor repeal the tax and but has failed to have enough votes to override a presidential veto. If repealed, the national deficit will enlarge even more (>24B$ over ten years).

There is debate by industry that this is resulting in loss of jobs and shift of $ from R&D to paying taxes and yet the evidence is mixed thus far.

Count on the rich/powerful device lobby to have enough money to influence even the Elizabeth Warren (Senator from Mass.) wing of the D party, which has never met a tax it does not like to support repeal!

Let us see what happens.

Long work hours & stroke

Long work hours have been known to have an association with cardiovascular disorders, specifically coronary artery disease.

A recent meta-analysis studies the role of work hours and stroke in 528,908 stroke-free men and women and included 25 studies from 24 cohorts in Europe, the USA, and Australia.

Follow-up was a mean of 8.5 years. Compared to standard hours (35-40 hours/week) working long hours (≥55 h per week) was associated with an increase in risk of incident coronary heart disease and incident stroke (1.3 times increased risk or 33%) . The association with stroke was stronger and ‘dose dependent’ meaning the association was strongest for those working > 55 hours and less for 49-54 and 41-48 hours/week.

The authors point out that “sudden death from overwork is often caused by stroke and is believed to result from a repetitive triggering of the stress response” and physical inactivity indicated by sedentary work.

Problem with the study is that the analysis included many uncontrolled, observational studies some of whom were not even peer reviewed. Also risk factors for stroke and CAD were not studied. Working 50 hours as a secretary may not have the same stress as a company CEO or harried physician.

In Gallup surveys in 2013 and 2014, 40% of full-time American workers reported working at least 50 hours weekly, and half said they usually work more than 40 hours. (

I imagine a trial, which is properly controlled for all possible variants would be practically impossible to do. In the meantime, as Steve Jobs said “"Your time is limited, so don't waste it living someone else's life."!!

Insurers versus hospital/physician groups food fight

A recent opinion piece in JAMA by David Cutler PhD Eckstein Professor of Applied Economics in the Department of Economics and Kennedy School of Government at Harvard University and a member of the Institute of Medicine lays out issues with mega mergers going on in the health care environment.

Dr. Cutler was an advisor to Presidents Clinton and Obama. He was also intimately involved with the Affordable Care Act (aka Obamacare).

He points to Aetna and Humana announcing their intention to merge, as well as Anthem and Cigna to become the big three instead of the ‘big five.’ Naturally, physician and hospital groups are unhappy. But, insurers point to the growing consolidation of large physician groups and mainly hospitals, which they claim is giving them too much leverage and raising costs. He says that all sides then drag the federal Government into the food fight. Now, everyone knows that is a recipe for disaster. Both camps are calling on the FTC to review anti-trust issues of mergers. Dr. Cutler mentions several questions as a result of these skirmishes but does not really give any answers. He ends with more questions!

Why are these ‘experts’ afraid to speak up? They are going to upset someone or the other. Pretty soon the fight will be over when the big insurers buy hospitals and big physician groups. The answer lies into who has more clout (donated more money to campaign coffers). The FTC does not operate in a vacuum.

Are physicians/hospitals ready for new reimbursement models?

Answer: Maybe.

With all the talk about ACOs, capitation (again), value based, quality based and bundled payments, is there infra structure in place to actually execute this idea?

KPMG, the well-known audit, tax and advisory company surveyed the finance function of 164 healthcare associated professionals to assess their readiness. Only 61% said their finance divisions are accumulating gathering tools and conducting analysis to get ready for these new models. 13% were unprepared for new reimbursement models.

Remember, that CMS has signaled linking 90 % of reimbursements to value or quality-based measures by fiscal year 2018. In response, 73 % of those surveyed said they were getting ready for migrating and preparing for value-based payments.

20% of respondents said they are prepared to measure risk and therefore able to calculate fees while 23 % are ready to utilize data and analytics to actually measure and improve efficiency and quality.

Some payers and health systems are undergoing complete overhaul of their financial and analytic information systems to be ready for this tsunami of new data points. This massive work is going on behind the scenes while we are still unsure whether anything other than WRVUs really matter. Consulting firms are prepared to ring up big profits. They and insurance companies (the few conglomerates still left standing) are sure and betting on it.