Want to take a guess at what the number one worry of Physicians is?
When a CPA makes a mistake it may result in the client being audited. When an engineer makes an error, it's usually something that can be corrected. But when a doctor makes a mistake, it can result in death for his patient. This is the greatest fear of every Physician. To make matters even worse, lawsuits against the medical profession are running rampant. Why is this so?
The general public believes that doctors live on easy street. While it's true that physicians usually make an above average living, it's also true that they have some significant worries that most of us don't have. Salaries for doctor's have declined significantly in the last ten years, and surveys have indicated that the number one concern facing this group of professionals today is what to do about frivolous and runaway lawsuits, along with high jury awards that can potentially wipe out their personal wealth. Now that's a concern that most of us don't have.
But does this worry affect patient care?
The High Cost of Litigation
1. The Costs of Excessive Testing
The possibility of missing something is always uppermost in the mind of a physician. Is it possible that they may order more tests than necessary in order to protect themselves from litigation? Of course. According to an Archives of Internal Medicine survey in 2010 ninety percent of physicians surveyed said doctors overtest and overtreat to protect themselves from malpractice lawsuits.
2. The Costs of Overtreatment
The tendency to overtreat patients exists, again due to the fear of potential lawsuits. Better safe than sorry. The overuse of prescription drugs can lead to more illness due to overlapping side-effects. An increase in scheduled visits for the same illness for additional tests and follow-ups will push costs. Add to these the cutbacks on reimbursements because of ever-increasing government regulation, and you can see the approaching dark cloud from the doctor's point-of-view.
3. Physician Burnout
Have you noticed a decrease in the amount of time your doctor spends with you? It's not his fault. A BYU study suggests that the number of hours physicians work each week is strongly influenced by the fear that they have of malpractice lawsuits. Also, the costs of malpractice insurance coverage is exploding. This, coupled with an absolutely amazing increase in government regulation is causing many doctors to make significant lifestyle choices, such as closing private practices and going to work for large hospital systems, retiring early, or even not entering the profession at all.
The point is that defensive medicine takes a huge toll on the doctor and patient alike!
What is Asset Protection, and how does it help?
Doctors go to work everyday with the knowledge that one mistake could wipe out everything they've ever worked for!
Asset protection is simply a plan to protect the physician's assets from creditors in case of litigation. A properly constructed plan will protect the family home, any rental properties, non-rental properties, stocks and mutual funds, bank assets, IRA's and other retirement accounts, automobiles, planes, boats,waverunners and motorcycles, other business entities the physician may have, accounts receivable, and any future inheritance for the family. A very good asset protection plan can be implemented for between $3000-12000 and I believe is some of the best money ever spent by a physician.
The goal with asset protection is to protect your assets before a lawsuit and keep the assets after the lawsuit is over. The properly drafted and executed plan has been described by some physicians as "lifting the weight of the world off my shoulders," and relieves the doctor from having to worry about losing everything, which frees him or her up to provide optimum medical care.
Note: None of the above should be construed as legal advice. While a good financial planner may act as a part of the team, any recommendations and implementation should be verified by an attorney knowledgable in the subject of asset protection.