October 2013

OCTOBER 2013

A PUBLICATION OF PNNwww.PhysiciansNewsNetwork.com

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R E P O R T I N G O N T H E E C O N O M I C S O F H E A L T H C A R E D E L I V E R Y

The New Official PublicaTiON Of The lOs aNgeles cOuNT y Medical assOciaTiON

InvestIngMEDICAL DEVICES • PHARMACEUTICALS MOBILE HEALTH • REAL ESTATE & MORE

PLUs

Office Leasing Tips

Maximizing Your Social Security Benefits

NORCAL Mutual is owned and directed by its physician-

policyholders, therefore we promise to treat your individual

needs as our own. You can expect caring and personal

service, as you are our first priority. Contact your broker or

call 877-453-4486 today. Visit norcalmutual.com/start

for a premium estimate.

A N o r c A l G r o u p c o m pA N y

N o r c A l m u t u A l .c o m

october 2013 | w w w. p h ys i c i a n s n e w s n e t wo r k .com 1

Volume 144 Issue 10

Physician Magazine (ISSN 1533-9254) is published monthly by LACMA Services Inc. (a subsidiary of the Los Angeles County Medical Association) at 707 Wilshire Boulevard, Suite 3800, Los Angeles, CA 90017. Periodicals Postage Paid at Los Angeles, California, and at additional mailing offices. Volume 143, No. 04 Copyright ©2012 by LACMA Services Inc. All rights reserved. Reproduction in whole or in part without written permission is prohibited. POSTMASTER: Send address changes to Physician Magazine, 707 Wilshire Boulevard, Suite 3800, Los Angeles, CA 90017. Advertising rates and information sent upon request.

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14 invesTing in whaT yOU knOw

In today’s fast-changing health environment, more physicians are turning their attention to-ward new and exciting investment opportuni-ties, from medical equipment and devices and mobile health to pharmaceuticals and real es-tate. With all these choices, it’s difficult to know how to get started in the investment world.

dePaRTMeNTs 6 fROnT Office | PRacTice ManageMenTTips, hints, advice and resources

10 Balance | lifesTyle & wellnessNews, studies, tips and opportunities to help physicians maintain a balanced lifestyle

10 TRansiTiOns | caReeR ManageMenTA look at the questions and challenges associated with various stages of your medical career

22 Pnn | news in ReviewThe latest headlines impacting the economics of healthcare delivery in Southern California

24 UniTed we sTand | aT wORk fOR yOULACMA and CMA membership at work for you

fROM yOuR assOciaTiON

4 PResidenT’s leTTeR | MaRshall MORgan, Md

26 ceO’s leTTeR | ROcky delgadillO

27 lacMa news | assOciaTiOn haPPenings

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12 MaxiMizing yOUR sOcial secURiTy BenefiTs

For most Americans, Social Security is a significant retirement asset. Making the best possible selections related to your Social Security options can mean a substantial difference in the income it provides to you over the course of your retirement years.

Statement of Ownership, Management, and CirculationPublication Title: Southern California Physician. Publication Number: 1533-9254. Filing Date: 10/01/12. Issue Frequency: Monthly. Number of Issues Published Annually: 12. Annual Subscription Price: $39. Complete Mailing address of Known Office of Publication: 707 Wilshire Boulevard, Suite 3800, Los Angeles, CA 90017. Complete Mailing Address of Headquarters or General Business Office of Publisher: 707 Wilshire Boulevard, Suite 3800, Los Angeles, CA 90017. Full Names and Complete Mailing Addresses of Publisher, Editor and Managing Editor - Publisher: Sheri Carr, 707 Wilshire Boulevard, Suite 3800, Los Angeles, CA 90017. Editor: Tom York, 707 Wilshire Boulevard, Suite 3800, Los Angeles, CA 90017. Managing Editor: 707 Wilshire Boulevard, Suite 3800, Los Angeles, CA 90017; Owner: LACMA Services, Inc. 707 Wilshire Boulevard, Suite 3800, Los Angeles, CA 90017. Known Bondholders, Mortgagees, and Other Security Holders Owning or Holding 1 Percent or more of Total Amount of Bonds, Mortgages, or Other Securities: None. Tax Status: Has Not Changed During Preceding 12 Months. Publication Title: Southern California Physician. Issue Date for Circulation Data Below: September 2012. Extent and Nature of Circulation - 15a. Total Number of Copies: 5053 (avg)/5324 (actual); 15b1. 4315 (avg)/4655 (actual); 15b2. 0 (avg)/0(actual); 15b3. 0 (avg)/0(actual); 15b4. 0 (avg)/0(actual); 15c. 4315 (avg)/4655 (actual); 15d1. 0 (avg)/0(actual); 15d2. 0 (avg)/0(actual); 15d3. 0 (avg)/0 (actual); 15b4. 720 (avg)/669(actual); 15e. 720 (avg)/669(actual); 15f. 5053 (avg)/5324 (actual). 15g. 0(avg)/0 (actual). 15h.5053 (avg)/5324 (actual). 15i. 85.3 (avg)/87.4 (actual). Publication of Ownership: If the publication is a general publication, publication of this statement is required. Will be printed in the October 2014 issue of the Publication. Signature and Title of Editor, Publisher, Business Manager or Owner. , Publisher. 10/1/12.

NORCAL Mutual is owned and directed by its physician-

policyholders, therefore we promise to treat your individual

needs as our own. You can expect caring and personal

service, as you are our first priority. Contact your broker or

call 877-453-4486 today. Visit norcalmutual.com/start

for a premium estimate.

A N o r c A l G r o u p c o m pA N y

N o r c A l m u t u A l .c o m

SubScriptionSMembers of the Los Angeles County Medical Association: Physician Magazine is a benefit of your membership. Additional copies and back issues: $3 each. Nonmember subscriptions: $39 per year. Single copies: $5. To order or renew a subscription, make your check payable to Physician Magazine, 707 Wilshire Boulevard, Suite 3800, Los Angeles, CA 90017. To inform us of a delivery problem, call 213-683-9900. Acceptance of advertising in Physician Magazine in no way constitutes approval or endorsement by LACMA Services Inc. The Los Angeles County Medical Association reserves the right to reject any advertising. Opinions expressed by authors are their own and not necessarily those of Physician Magazine, LACMA Services Inc. or the Los Angeles County Medical Association. Physician Magazine reserves the right to edit all contributions for clarity and length, as well as to reject any material submitted. PM is not responsible for unsolicited manuscripts.

editor

diSpLAy Ad SALeS / director oF SALeS

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sheri carr 559-250-5942 | [email protected]

ADVErtiSinG SALES

christina correia 213-226-0325 | [email protected] Pebdani 858-231-1231 | [email protected] h. aizuss, Md Troy elander, Md Thomas horowitz, dO Robert J. Rogers, Md

HEADquArtErS

Physicians news networklos angeles county Medical association707 wilshire Boulevard, suite 3800los angeles, ca 90017Tel 213-683-9900 | fax 213-226-0350www.physiciansnewsnetwork.com

LAcMA officErS Marshall Morgan, MdPedram salimpour, MdPeter Richman, Mdvito imbasciani, Mdsamuel i. fink, Md

LAcMA boArD of DirEctorS

david aizuss, Mdwilliam averill, Md Boris Bagdasarian, dOerik Bergstephanie Booth, Mdsteven chen, MdJack chou, MdTroy elander, Md hector flores, Mdcarlotta freeman, Mdsidney gold, Md william hale, Md david hopp, Md Paul kirz, Mdlawrence kneisleykambiz kozari, Md howard krauss, Md Maria lymberis, Mdcarlos e. Martinez, Md nassim Moradi, Md ashish Parekh, Md Jennifer Phan heidi Reich, MdPeter Richman, Mdsion Roy, MdMichael sanchez, Md nhat Tran, Mderin wilkes, Md

the Los Angeles county Medi-

cal Association is a profes-

sional association representing

physicians from every medical

specialty and practice setting

as well as medical students,

interns and residents. For more

than 100 years, LAcMA has

been at the forefront of cur-

rent medicine, ensuring that its

members are represented in the

areas of public policy, govern-

ment relations and community

relations. through its advocacy

efforts in both Los Angeles

county and with the statewide

california Medical Association,

your physician leaders and staff

strive toward a common goal–

that you might spend more time

treating your patients and less

time worrying about the chal-

lenges of managing a practice.LAcMA’s board of Directors consists of a group of 30 dedicated physicians who are working hard to uphold your rights and the rights of your patients. they always welcome hearing your comments and concerns. You can contact them by emailing or calling Lisa Le, executive Assistant, at [email protected] or 213-226-0304.

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H 63183, CMA Los Angeles Medical Ad (10/13)Full Size: 8.375 x 10.875 Live Area: 7.275 x 9.825 Bleed: 8.625 x 11.125Colors: 4/4 (CMYK)Stock: #60 White OffsetPostage: NAMisc: NA

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Health care reform is in full-swing with the heftiest legislation set for 2014 — when health insurance will become available to millions of Americans who were previously uninsured.

HealtHCare reform tHe BasiCs for individuals

•Individual Mandate—MostindividualsarerequiredtohaveandmaintainhealthinsuranceeffectiveJanuary1,2014.Thereareexceptionsforcertainindividuals.

•Penalty—Ifyouelectnottopurchasecoverage,youarerequiredtopayapenalty –in2014:thegreaterof$95/individual(3perfamily),or1%ofincome –In2015:thegreaterof$325/individual(3perfamily),or2%ofincome –In2016:thegreaterof$695/individual(3perfamily),or2.5%ofincome

•Guaranteed issue—Insurancecompaniesmustsellcoveragetoeveryone,regardlessofpre-existingconditions,andcan’tchargemorebasedonhealthorgender.

•Health Insurance Exchange—Individualswithoutaccesstoaffordable,employer-sponsoredplansthatprovidequalifyingcoveragecanenrollinplansofferedeitherthroughtheindividualinsurancemarketorthroughCoveredCaliforniawithcoveragebeginningJanuary1,2014.

OpenenrollmentcommencesonOctober1,2013.Ifindividualsdon’tenrollwiththeexchangeduringtheinitialopenenrollmentperiod,theywillhavetowaituntilnextyear’sopenenrollmentperiodtoobtaincoverage.

•Subsidies—Individualsandfamiliesmayqualifyforfederaltaxcreditsandbenefitsubsidiesonlythroughtheexchange.Taxcreditsareavailabletothosewhomeetcertainincomerequirementsanddonothaveaccesstoaffordablehealthinsurancethatmeetsminimumcoveragestandardsofferedthroughtheiremployeroranothergovernmentprogram.Eligibilityfortaxcreditsisbasedonfamilyincomeandsize.

•Premiums—Premiumscanonlyvarybyage,geographyandfamilycomposition.Theymaynotvarybygenderorhealthconditions.

•Annual or lifetime limits—Individualandgroupplansmaynotimposelimitsonessentialbenefits.

•Out of Pocket expenses—Limitsout-of-pocketexpensesforco-pays,co-insurance,deductibles,etc.to$6,350perindividualtoamaximumof$12,700/familyannually.

Beginning January 1, 2014, new regulations provide most Americans access to affordable health insurance that covers essential care. The regulations that facilitate this include:

did you know?

Startingin2014,mostAmericansmusthavequalifyinghealthcoverageorpayataxpenalty.

Optionsforcoverageincludeinsurancepurchasedthroughtheindividualmarket,apublicexchange,agovernmentprogramoranemployer-sponsoredprogram.

minimum essential Benefits inClude:

•Ambulatoryservices•Emergencyservices•Hospitalization•Maternityandnewborncare•Mentalhealth/substanceabusetreatments•Prescriptiondrugs•Rehabilitativeservices•Laboratoryservices•Preventive/wellnessservices•Pediatricservices

for more information, call a marsh client advisor at 800-842-3761.

Marsh and the Association do not provide tax or legal advice. Please consult with your own advisors to determine how the law’s changes and your decisions impact your personal situation.

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Staytunedformorehealthcarereformcommunication.Inthemeantime,pleasecallMarsh/Seabury&SmithInsuranceProgramManagementat800-842-3761formoreinformation.

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4 P H YS I C I A N M AG A Z I N E | october 2013

Covered CaliforniaImplementation of the Accountable Care Act (aka

Obamacare) is at hand. There are two major com-ponents of improved coverage: Medi-Cal expansion for low-income individuals who were previously in-eligible and private insurance products through the exchange (Covered California). This Letter relates to Covered California, California’s health insurance ex-change. The open enrollment period for health plans offered in Covered California began October 1.

Covered California has formed agreements with twelve ”Qualified Health Plans” six of which will offer products in Los Angeles County. The options offered

and the recruitment of network physicians were, under the law, left to the individual Plans.

A very large number of those who become newly insured under these plans will be low-income, previously uninsured persons who will now choose to purchase insurance through Covered California, some be-cause the premiums are more affordable, others because they are now eligible for federal subsidies. These patients are geographically concentrated in poor and underserved neigh-borhoods.

The great mistake the Plans have made is that they did not recruit in the community of private practice physicians; they have claimed that this is

because they believed they had been instructed by Covered California to preferentially recruit federally subsidized clinics and limit the number of private practitioners. This led to networks that are narrow and have inadequate numbers of physicians to meet the anticipated demand for services.

When the nature of the planned networks became public, leaders in the community of “private practice Essential Community Providers,” particularly Richard Baker, MD, Toni Chavis-Greene, MD, and Hector Flores, MD, expressed their concerns to the Covered California board and reached out to LACMA for assistance. Dr. Baker and Dr Chavis-Greene are co-chairs of LACMA’s African-American Advisory Committee; Dr. Flores is chair of LACMA’s Latino Advisory Committee. They felt it was mandatory that Covered California officials and Plan executives understand that the networks that the Plans have recruited to serve this population are inadequate and inappropriate for three reasons:

- They are too few in number.- They are not appropriately geographically distributed.- They fail to include physicians in private practice who

now provide the majority of care for this population.

If this situation is not corrected, the newly insured will find it difficult to get appointments with a physi-cian, will have to travel long distances for those ap-pointments, and long-standing doctor-patient rela-tionships will be disrupted. This is highly likely to have an adverse effect on the health of these patients. In addition, the practices and livelihoods of physicians who have served this population faithfully for many years will be severely adversely affected.

In response to these issues LACMA convened a Town Hall meeting, which was held on Tuesday, Sept 16. The Chief Medical Advisor of Covered California and representatives of four of the six Plans were pres-ent. Having been briefed in advance by LACMA on the concerns of our members, each gave a brief presen-tation. The first was given by the Chief Medical Advi-sor of Covered California, who immediately and pub-licly retracted Covered California’s claim that 80% of eligible providers had been enrolled in these plans, a claim that upon its initial publication Drs. Flores, Baker, Chavis-Greene and others had immediately disputed.

The loud and clear message those officials then heard from the approximately 75 physicians present (a standing-room-only crowd) was that the networks

- need to be expanded;- need to include an adequate number of physicians

who are in geographical proximity to the target population; and

- need to include the private practice physicians who are presently caring for a majority of the affected patients.

The meeting was cordial, for the most part, and always civil. However, the message was clear: Signifi-cant improvements need to be made.

The Plan representatives maintained that they are eager to recruit additional physicians for their panels and are in the process of doing so. However, the doc-tors in attendance made it clear to them that they are doing a poor job making that known, since none of them were aware of it.

Your LACMA will, in conjunction with the con-cerned private Essential Community Providers, close-ly monitor the actions of Covered California and the Qualified Health Plans. In the immortal words of CNN anchorman Anderson Cooper, we are “keepin’ them honest”!

Marshall Morgan, MD, is a professor and chief of emergency medicine at the Ronald Reagan UCLA Medical Center and director of emergency medicine center at the David Geffen School of Medicine at UCLA. He is the 142nd president of the Los Angeles County Medical Association.

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6 p h ys i c i a n m aG a Z i n e | october 2013

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Don’t hesitate to offer on more than one building that meets your require-ments. Letters of Intent to lease are non-bind-ing. It’s useful to check the flexibility and mo-tivation of landlords in getting you into their property.

In Pasadena, for in-stance, expect to pay about $3.00/S.F. for medical space near Huntington Hospital, $6.00/S.F. in the bev-erly Hills triangle, or about $3.50/S.F. near torrance Memorial.

these rates are based upon fully serviced leases, mean-ing that all expenses are included in the initial base rent (there are pro-rated expenses following the base year of the lease that may be passed on to the tenants). triple Net (NNN) leases might appear appealing in that the base rent is generally less than fully serviced leases, but all the property’s operating expenses are passed on to the tenants. these expenses, including property taxes, insurance, maintenance, utilities and more, can quickly add up and are difficult to control by tenants.

the base rent, or starting rent rate, is probably the most negotiable issue in the lease. often, a 5% dis-count from the market asking rate is possible with a minimum 5-year lease term.

While the beginning base rent/ S.F. is negotiated and fixed to begin the lease term, the amount the rent increases annually is also negotiable. this is important, especially in longer term leases, where the annual compounding effect can dramatically increase rents over 7-10 years. In the past decade, generally speak-

ing, annual fixed rent increases in most leases have been 2.5-3.00%. Some leases, however, are based upon local actual cPI increases and may float with a minimum 2% and maximum 4-5% increase as a method of protecting both landlord and tenant against major inflation swings.

the tenant improvement allowance paid by the landlord toward the medical suite build out or modifi-cation can vary widely depending upon the landlord, the current suite condition and the term of the lease. For instance, a new 5-year lease term at the full asking lease rate may earn you $10-$20/S.F. of landlord im-provements in the second or third generation suite you are moving into, whereas a 10-year term might coerce a landlord to provide as much $50-$60/S.F. of needed suite improvements. All is negotiable.

If few improvements or modifications to the suite are necessary, then landlords may consider a rent abatement (free rent) period, perhaps one month free per year of the lease term.

As mentioned above, a medical building’s operat-ing expenses can vary significantly and are passed on to physician tenants in different ways depending upon the lease type: triple Net (NNN), Full Service Gross (FSG) or Modified Gross (MG), which is a bit of a hy-brid model. When comparing various lease types in competing buildings, be certain to know the subtle expense pass through differences and the total rent amount you will be paying monthly.

In summary, medical rents differ both by commu-nity as well as medical property based upon building costs as well as supply and demand for office space. every market has its own competitive issues and land-lord motivation to fill vacant space. An experienced broker can assist in identifying space and negotiating your lease along with a real estate attorney. However, the process behooves the physician tenant to have a basic understanding of the process, expectations and outcome. Written by Michael Dettling, Principal, Avison Young Healthcare Real Estate Group

OFFICE LEASING TIPSWritteN by michAeL dettLiNg

MOsT Physicians Think about office leasing every 5-10 years when their lease is about to expire

or they are beginning a new practice. Considerations when thinking about office location include

current and potential referral sources, existing patient base, convenience to home, hospital affilia-

tions, competition, lease rates and more. An experienced commercial office broker with keen local

knowledge of medical properties is usually the place to begin. The broker should be aware of the

completed lease transactions in medical buildings in the area including lease rates and leasing con-

cessions from area landlords.

Medical rents dif-fer both by com-

munity as well as medical prop-

erty based upon building costs as

well as supply and demand for

office space.

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ScA is the unexpected loss of heart function, breathing, and consciousness. In ScA, the electrical system of the heart fails and, at times, a heart attack may occur concurrently.

About half of people who suffer ScA had no previ-ous symptoms, such as fatigue, dizziness, and racing heart rate. Approximately 325,000 people in the U.S. die from ScA annually. People who smoke or have cor-onary artery disease, have had a previous heart attack, have high cholesterol, and/or have a family history of heart disease have a higher risk.

these malpractice claims are representative of claims involving ScA:

• A 52-year-old patient had heartburn for over aweek, and her physician treated this symptom. the patient had high blood pressure, elevated blood glucose, and normal cardiac enzymes. Her father had died at age 55 from a heart attack, and she had a family history of coronary artery disease. the phy-sician only considered the diagnosis of heartburn and did not order serial cardiac enzymes, an eKG, or a cardiac consult. the patient died the next day from ScA.

• An obese patient had elevated triglycerides andcomplaints of burning in the chest with walking, but no shortness of breath or radiation of the burn-ing sensation into the upper extremities. the physi-cian had done an eKG a year earlier, which was abnormal, and did another eKG, which was also abnormal, with a computer reading of possible left ventricular hypertrophy. the physician thought this eKG was normal, as was his examination, but he did order a cardiology consultation. Prior to the consult, the patient died.

These Tips can help providers avoid misdiagnosis of sca:

• Consider thepossibilityof advancedcardiac

risk in patients who:

o Are overweight and unable to control their weight with diet and exercise.

o Have high blood pressure not responsive to medication.

o Have evidence of erectile dysfunction.

o Are glucose intolerant.

o Have consistently high cholesterol levels.

o Have a history of alcoholism.

• Take into account other factors associatedwith ScA, including:

o Incidence increases with age—men after age 45 and women after age 55.

o Men are two to three times more likely to have ScA than women.

o Personal or family history of heart rhythm disorders, congenital heart defects, heart failure, or cardiomyopathy.

o Use of illegal drugs (amphetamines or co-caine).

o Nutritional imbalances (low potassium or magnesium levels).

Contributed by The Doctors Company. For more patient safety articles and practice tips, visit www.thedoctors.com/patientsafety.

Sudden Cardiac Arrest The RecenT deaTh of James Gandolfini, who played mafia boss Tony Soprano in the hit TV series

The Sopranos, and recent malpractice cases are reminders that healthcare providers need to be on

alert for the risk factors of sudden cardiac arrest (SCA).

risk tip

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Home buying and selling is a

high stakes game in Southern cali-

fornia because it is one of the

priciest markets in the nation. It is even more so for physicians, who

typically have less discretionary time and who purchase

more expensive homes than the

average consumer.

Another reason for the gains is the strong pres-ence of cash investors, some foreign, which is creat-ing upward pressure on home prices. In some parts of Southern california, this is causing an almost artificial housing shortage, with the losers being first-time home buyers whose less-than-all-cash offers are not sufficient to garner what would normally be winning bids.

one trustworthy indicator of where the real estate market is headed is Home Depot; its stock is up 120% in just two years. Since the housing market is an im-portant contributor to the U.S. economy, investor con-fidence is boosted when housing prices improve and more jobs are created, including construction jobs.

don’T confuse The Big picTure wiTh Your picTure

Home buying and selling is a high stakes game in Southern california because it is one of the prici-est markets in the nation. It is even more so for physi-

cians, who typically have less discretionary time and who purchase more expensive homes than the average consumer.

With a plethora of data, charts and graphs at our fingertips and “expert” opinions from Internet publica-tions and traditional media, distilling the white noise from genuine information can be challenging. this is equally true whether your perspective is that of a home seller or a prospective buyer.

A common and often very misleading statistic is one in which home prices are compared to prices from the prior year. For instance, the S&P/case-Shiller Home Price Index shows that prices increased slightly more than 12% this past June from 2012, a number echoed by coreLogic®, a mortgage analytics firm. However, these are national numbers that may have little bearing on what is occurring in the microcosm of your neighborhood.

DataQuick®, another data analytics resource, drills down its home pricing data to the community level. For instance, within Los Angeles county, you can check annual price changes for Pasadena, Santa Monica, encino, etc. but that analysis still falls short because all three communities are large and encom-pass multiple Zip codes. If you really want to know trending for homes in your neighborhood, you need to look even deeper.

this is where having the right realtor® is invalu-able. In the past, using an agent who lived in the neighborhood was common. today, most real estate agents have clients living throughout Los Angeles county. Hiring an agent with strong analytical skills and experience in multiple communities may be a better strategy so you can move from one neighbor-hood to another with the assistance of that agent’s ex-pertise and versatility.

Monique Bryher, MSPH, is a licensed real estate broker and Realtor® who sells residential and investment property to physicians in the Los Angeles area. She can be reached at 818-430-6705.

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REAL ESTATE SMARTS: Investing in Your HomemoNique bryher, mSph

afTeR six lOng years of steady declines, the housing market did an abrupt about-face in early

spring and has made impressive gains every month since then. Some of the gains are due to the

recent uptick in interest rates, motivating buyers who were fence-sitting and worried they will be

priced out of the market if they fail to act now.


This is how Dr. Eubanks got paid for Meaningful Use.

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the time in which you elect to begin receiving Social Security payments is very important. the age you begin these distributions will impact your benefits for the rest of your life and potential benefits to your spouse if you are married. there are several factors that should be considered before selecting the optimal date to begin receiving benefits. Your health status, life expectancy, need for income, whether you plan to continue working, and your concerns about running out of money in your retirement years should all be considered in determining your date to initiate Social Security benefits.

If you are married, other factors that can influence your decision may include your spouse’s life expec-tancy, which of you is the higher wage earner, and how concerned you are about the risk of running out of money in your joint lifetime. these aspects and con-siderations can become increasingly more complex. Analysis requires careful consideration of the inputs, assumptions, taxes and other factors that will impact your Social Security benefits. It is critical to consider Social Security benefits in conjunction with all of your retirement assets for an optimal strategy. Incorporating

your benefits into an overall retirement income plan may make a substantial difference in the amount of income available to you in retirement.

How your benefit eligibility is determined is based on the following:

1) How much you earned over your working career

2) the age at which you apply for benefits

3) Spousal benefits – extra money allocated to mar-ried couples

4) Survivor benefits - reassessment of benefits to help the surviving spouse.

Social Security benefits are based on average earn-ings over your highest 35 years of income, with earn-ings through age 60 indexed to reflect increases in U.S. Workers’ Average Wage Level. For example, if the wage level in the U.S. is twice as high when you turn 60 as when you were 40, the formula doubles your earnings at age 40. If you worked less than 35 years, the “missing” years are calculated as zero. So the maximum income in any year is equal to that year’s maximum income subject to Social Security taxes.

If you claim benefits earlier than your full retire-ment age (FrA) and continue to have more than a modest amount of earned income (i.e. wages and sal-ary), you may lose some or all of your Social Security benefits. In addition, if you had wages from work not covered by Social Security, then the Social Security Administration’s estimate of your benefits may be sub-stantially higher.

our firm uses software created by the industry leader in Social Security claiming strategies. the pur-pose of the Social Security Strategy Snapshot report is to offer a high-level introduction and education to you so you better understand your Social Security retire-ment benefit options.

classic Financial can help you determine when to begin benefits through this program. call us at (800) 750-PLAN (7526) for your free report only offered to LAcMA members. We are here to help you.

Maximizing Your Social Security Benefitsby chArLeS m. ruSSo, cFp®

fOR MOsT aMeRicans , Social Security is a significant retirement asset. Making the best possible

selections related to your Social Security options can mean a substantial difference in the income it

provides to you over the course of your retirement years.

“Never invest in a business you can’t understand.”-Warren Buffett

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In today’s fast-changing health envi-

ronment, more physicians are turn-

ing their attention toward new and

exciting investment opportunities,

from medical equipment and devic-

es and mobile health to pharmaceu-

ticals and real estate. With all these

choices, it’s difficult to know how to

get started in the investment world.

This article offers expert advice from a physi-cian-turned venture capitalist: Learn how to get started on health investments, pros and cons of investing in private vs. public companies, being an active vs. a passive investor, as well as the different types of investments.

How to Get StartedDr. Drew Senyei, managing director at the San

Diego-based venture capital firm Enterprise Part-ners, said while medical schools don’t teach physi-cians about finance, it wouldn’t take them long to learn the basics.

“Learning the vocabulary of investment is similar to medicine,” Dr. Senyei said. “Physicians can take basic courses on financial statements and account-ing so they have the tools to really understand a value proposition that a particular business oppor-tunity has to offer.”

Investing in Public vs. Private CompaniesSecondly, Dr. Senyei advised physicians to de-

cide whether to invest in privately held vs. public companies, which encompasses different methods of assessment.

Here are the main differentiators. Let’s start with public companies.“Public companies tend to be almost transpar-

ent in terms of their financial track-record, and need to disclose, by law, significantly more infor-mation than private companies,” he noted.

They also tend to attract a lot of very smart in-vestors that have done their homework and due diligence.

Invest in What

You KnowBy Marion Webb

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“What doctors can bring to the table is their medical knowledge,” he said. “If a drug company is develop-ing a drug and it’s in your field and you looked at the medical publica-tions and reports, because of your medical training you may be in a bet-ter position to decide on the likeli-hood of success of a drug being ap-proved or not.”

He said the same thinking applies to investing in devices and diagnos-tics.

Private companies can range from small start-ups to later-stage compa-nies that are trying to raise capital.

Once again, doctors have the ad-vantage to apply their medical know-how to assess a firm’s likelihood of success.

However, since privately held firms are not required by law to dis-close a lot of information, investors have to be very diligent in their ef-forts.

“You need to determine how active or passive you want to be in private companies,” Dr. Senyei said.

Passive investors, who act as a limited partner or small equity holder in a private firm, typically can get away with being full-time practitioners.

Active investors, however, need to be prepared to spend a considerable amount of time and mon-ey on their venture.

They can expect to reap certain tax benefits, if they can show they’ve dedicated a certain amount of hours a year on their investment. They also need to be risk-takers.

“If you decide to become an active investor, you need to consider the impact on your day-time job,” he said. “That’s a personal decision based on your financial situation and how risk-tolerant you are.”

With most start-ups failing—the harsh reality of the marketplace—doctors need to be diligent in their efforts.

You want to look for top quality management with a solid track record in your space of investment, the type of intellectual property, and check with an out-side councel whether patents have been reviewed

and how well they have been written for validity. These are all critical to the success of a company.“Most of the time, the patents will be pending,”

he said. Doctors need to decide if they are willing to take the risk to wait, if the patents are an issue or not.”

Competition also comes into play, and not to forget market size.

“Sometimes it’s hard to determine what the market size is, especially with new products,” he said. Doctors also need to understand if they are dealing with a “me-too product” or a truly “revolu-tionary product,” which isn’t always clear.

Also, he noted, doctors should know that not every idea is a company. Sometimes it’s just an add-on product for existing companies.

TYPeS of INveSTmeNTWhen it comes to healthcare investments, in-

vestors need to differentiate between subsectors.Each subsector—pharmaceutical, medical de-

vices, diagnostics and healthcare services and enabling tools and technologies used in research and clinical delivery—has a different set of criteria and bears different risks.

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“You want to make sure you understand the sector you invest in,” he said.

There is a risk factor for medical technology that’s not common to other companies and that is the significant role of the government at multiple levels of businesses.

The U.S. Food and Drug Administration (FDA) has strict requirements when it comes to data and safety of a drug, which can take years and hun-dreds of millions of dollars in clinical trials, before a drug is approved. Most experimental drugs fail.

Experts say that investors can minimize their risk by choosing companies that have a suite of approved products already on the market or have very strong data for products under development.

Drug CompaniesInvestors need to understand that each sector

has different financial and developmental timelines and value inflection points and different risk profiles.

In the case of drug development, a small com-pany needs to invest sometimes hundreds of mil-lions of dollars to try to get a new drug to FDA ap-proval, and there are no guarantees the drug will ever hit the marketplace.

“If you can get a drug through Phase II (follow-ing pre-clinical and Phase I data approved by the FDA), there may be enough value for a big com-pany to buy it, but there is also a risk to get to that

phase,” Dr. Senyei said. “You have to be aware of the total invested dollars to create value.”

The FDA requires that drugs pass Phase III clini-cal trials before even considering approval.

medical Devices Smaller devices can be developed for much

less money than drugs, Dr. Senyei noted. On the flipside, the risk-reward and inflection

points tend to be different. “In case of a drug, riding it out until it is ap-

proved takes a lot of risk and you lose a lot of mon-ey if a drug doesn’t get approved,” he said. “Sell-ing your assets before FDA approval is no easy task and requires significant capital.”

When it comes to devices, doctors also need to assess whether they’re dealing with a simple de-vice vs. a more complex one, the competition on the marketplace and market size.

mobile Health Health IT is undoubtedly one of the hottest in-

vestments. While patients may have been surprised to

see their doctors pull out an iPhone to check their blood sugar or cardiogram results two years ago, today the practice is as commonplace as consum-ers using their smartphones to track their daily cal-ories, fitness goals and to communicate with their

doctors. Experts predict that

under health reform mo-bile health devices and apps will become in-creasingly important to help consumers prevent disease and track their health status to prevent hospital readmissions and improve health outcomes.

Global market rev-enue for mobile health technology is expected to reach $26 billion by 2017, according to a March report from mo-bile industry analyst firm research2guidance.

By 2017, research-

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2guidance predicts that more than 3.4 billion people worldwide will have smartphones or tablet computers with access to mobile health apps and that about 50% of those people will have down-loaded such apps, iHealthBeat reported.

That said, physicians should be aware that the mobile space is also a high-risk investment, Dr. Se-nyei noted.

“The mobile space is very hot, but has low barriers for competition and like Internet-based companies doesn’t require a lot of capital, but the failure rate is high,” he said. “For every Facebook success, there are 10,000 failures.”

He said unless a company works on a product with an unmet need and is first on the marketplace, it’s a highly competitive space with prominent players.

For instance, San Diego-based mobile giant Qualcomm Inc. started a $100 million fund, Insight

Venture Partners put $40 million in a start-up, and even Oprah Winfrey reportedly invested in a web-site that helps doctors and patients interact.

“Qualcomm has a large healthcare division and is investing tens of millions of dollars,” Dr. Senyei said. “You want to make sure you understand the competitive space well before you do something that others are also thinking about.”

Having said that, there is tremendous opportu-nity for mobile applications that save the health-care system cost,” Dr. Senyei added.

Regulatory barriers also remain high.According to Bloomberg News, the majority of

health apps have not been cleared. Once the FDA decides an app requires clear-

ance, a company must comply with the regulations or risk the product being removed from the mar-ketplace.

In 2011, the FDA requested public comment on how it should regulate smartphones, tab-let computers and apps that collect health information or are used to monitor medi-cal conditions.

The agency has yet to issue final guid-ance about how it plans to regulate such technology, iHealthBeat reported.

Conclusion The bottom line is that doctors who

want to become investors can use their medical skills and training to their ad-vantage.

Doctors can assess an unmet medical need in their respective field, explore the scientific diligence of an investment op-portunity and they have the insight that others may lack when it comes to real-world applications of a particular device or drug in development.

“I think it’s a great idea for physicians to become financially savvy,” Dr. Senyei said. “It will help on the investment side. Physicians are very eager to help people and when you combine that desire to do good and to do well, that’s a pretty good outcome. But you have to be real-istic and measure your risk and your tol-erance for the financial risk and time and opportunity cost that is involved.”


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“Healthcare reform changed everything,” said Healthcare real estate Insights magazine editor John Mugford in a press release earlier this year.

After the peak of 2009 and the valley of 2011, the development of new medical office buildings and oth-er healthcare facilities is again on the upswing, said real estate firm Marcus & Millichap in a press release.

“the pace of development is still far less than dur-ing the go-go years of 2007-2009,” Mugford said. but there was probably 8.5 million square feet of Mob de-velopment in 2012, according to Marcus & Millichap.

berry baker, president of Spokane-based baker construction & Development, agrees with these as-sessments.

baker told news reports he predicts a huge demand in 2014 when 30% of Spokane residents who don’t have health insurance will be needing care, which will require more medical office space.

the influx of newly insured and the new health environment will increase demand for health services everywhere, experts said.

this trend has led health providers and healthcare

real estate firms alike to acquire, partner and affiliate at a rapid pace.

Hospitals, for instance, have left building owner-ship to other parties—a concept that fits well with the current development trend pairing not-for-profit hos-pitals with for-profit physician groups as partners with specialty facilities, the experts said.

As part of this trend, the Heart center of california (and in other states) reportedly accounted for a third of construction starts in 2007 alone.

the steady transition to deliver more healthcare in an outpatient setting is also accelerating.

experts find that at medical practices, providers are doing complicated procedures that were previously confined to hospitalized settings.

As a result, construction of medical office space is often more complicated and costly to manage and construct today, the experts said.

that, however, hasn’t deterred hospitals and inves-tors looking to buy practices and deliver care that’s closer to the patient.

At the same time, there is also the rising consolida-

Why Doctors Should Consider Investing in Real estateBy Marion Webb

experts say while many healthcare project developers have held back in recent years, in part because of the economy, the influx of tens of thousands of newly insured seeking care next year will raise the need for more medical office space.


Aside from golf, the most popular hobby for medical professionals may be investing in com-mercial real estate. This could mean buying a med-ical office building or perhaps acquiring an apart-ment complex, small retail property or a mixed-use building with ground floor retail and offices on top. If you are looking to invest in commercial real es-tate, you can help avoid costly surprises by paying attention to the following matters:

Do Your HomeworkMake sure that you have a “due diligence pe-

riod” in your purchase contract so that you can conduct a physical inspection of the property and evaluate other key issues relating to your in-tended use of the property. A professional inspec-tor should inspect the building (roof, foundation, structural elements, windows, existence of hazard-ous materials) and building systems (electrical, plumbing, heating and ventilation, telecom and data). If you uncover conditions that need repair or replacement, you will have the opportunity to negotiate with the seller before the end of the due diligence period.

If you intend to renovate the property or to change its use, you or your architect should con-firm that you can get the necessary approvals from the city and that the property is zoned appropri-ately. There may be height, bulk, parking or other

restrictions that limit your ability to make changes to the building or to its use.

Your architect should also evaluate whether any proposed renovations will trigger unplanned code upgrades. Some buildings may not comply with current building codes, but have been “grandfa-thered in” (that is, they are exempt from code up-grades unless the owner makes renovations, in which case the building may lose this exemption). Unforeseen code upgrades can greatly increase the scope and cost of your planned renovations.

Finally, you should review the condition of title to the property to see if there are any use restric-tions, easements or other rights that could inter-fere with your use of the property.

evaluate the TenantsThe value of your building comes from the rents

paid by its tenants, so you need to evaluate their creditworthiness and future business prospects. Review the tenants’ financial statements, paying particular attention to their cash flow. If they are having trouble paying employees or vendors, they may have trouble paying their rent. If some of the leases will expire soon and you are unsure whether the tenants will renew, you may need to budget for several months or more of decreased cash flow un-til you can re-lease the space. You may also need to set aside funds to pay for broker commissions

Avoid Costly Surprises When Investing in Real estateLeon Y. Tuan, Stein & Lubin, LLP

tion among physician practices.At a recent conference, healthcare real estate ex-

perts predicted that physician groups will continue to consolidate to cut costs, increase efficiencies and move to a more patient-centric environment.

“the traditional single-doctor medical practices are becoming obsolete,” said Andrew Hoover, regional as-set manager at torrance-based Providence Health & Services, a major healthcare real estate group. “this is driven by obamacare and by the (healthcare) system itself.”

He predicted that small-to-mid-sized doctor groups will be merging with larger groups or become acquisi-tion targets.

Physicians will team up to share office space and key resources such as medical equipment and new

technologies, including the costly investment in the newly required electronic health system.

this makes it pertinent for independent doctors to carefully consider their options before signing new leases.

At the same time, more doctors are retiring than new graduates entering the system, which opens up new opportunities for physicians to partner with an in-dependent developer.

With healthcare real estate still growing, investing in this sector just makes sense, Mugford said.

“the same factors that made healthcare real estate a good business back in 2003 make it a good busi-ness to be in today,” he said. “Plus, healthcare reform is likely to drive even more development, financing and investment activity.”

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and to build tenant improvements or to provide a tenant improvement allowance for replacement tenants.

Understand Lender RequirementsMany investors will take out a loan to finance a portion of the pur-

chase price of a property, so they will need to comply with the lender’s underwriting requirements. These requirements can include a maxi-mum loan-to-value ratio (the maximum amount the lender is willing to lend relative to the appraised value of the property) and a minimum debt-service coverage ratio (the minimum ratio of the monthly net op-erating income generated by the property relative to the amount of the monthly loan payment).

Some real estate loans are “non-recourse,” so if the borrower de-faults the lender’s only recourse is against the property and not against the personal assets of the borrower. However, most lenders will still re-quire a personal guarantee of “non-recourse carve outs” (for example, the borrower will be personally liable for damage caused by waste on the property, the misapplication of security deposits, or filing bankrupt-cy, which will delay the lender’s ability to take back the property follow-ing a loan default). Also, lenders will usually require personal guaran-ties for construction loans.

You may want to negotiate for an assumable loan. If prospective buy-ers for your property have the ability to assume an existing low interest rate loan, it may generate more interest in your property. You should also see if the loan contains a prepayment premium, which allows the lender to preserve its yield if you prepay the loan prior to maturity. If there is a prepayment premium, then it may not be economically fea-sible to refinance your loan if interest rates drop.

ConclusionCommercial real estate provides an attractive alternative to more

traditional investments such as stocks and bonds. However, as with any investment you should make appropriate inquiries before you buy. Make sure that you evaluate the physical condition of the property, your ability to make needed renovations, and the financial strength of the tenants. You should also understand the lender’s requirements if you intend to finance your purchase. These steps can help you avoid ex-pensive surprises down the road.

Leon Y. Tuan is a partner in Stein & Lubin’s Real Estate, Business and Finance and Workouts Practice Groups. He specializes in a wide range of commercial real estate, finance and general business transactions.

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S a c r a m e n T o

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reporTing on The economics of healThcare deliverY

read full sTories and suBscriBe To The pnn enews BulleTins aT www.phYsiciansnewsneTwork.com

most readincome on the rise for La county primary care Doctors, internists

According to the 2013 physician compen-sation report by staffing firm Merritt Hawkins, pay for primary care doctors and internists has risen in the last five years in Los Angeles County and other parts of Southern California, driven in part

by a doctor shortage in those areas and competi-tive hospital recruitment.

“Family practice and internal medicine are the top searches we do each year,” said Darryl Green, director of marketing at Merritt Hawkins, part of staffing company AMN Healthcare Co. “It is more of a supply and demand issue than anything else,” he said in an interview with PNN.

acos make choosing medical Devices a whole new proposition

Topics discussed at the medical DeviceFest & Expo recently in San Diego County indicate a changing paradigm when it comes to how physi-cians and hospitals will be evaluating and purchas-ing medical technology.

According to the panelists who discussed the impact of accountable care organizations (ACOs) on the device industry, physicians need to focus on a different value proposition when approached by medical device vendors. Hospitals and physicians who keep buying devices based on technology alone will not survive under the new reimburse-ment system that focuses on population manage-ment and wellness care as opposed to sick care.

proposed Bill ensures Qualified interpreters for medi-cal patients

The Los Angeles County Department of Health Services said a bill that makes a statewide medical-in-terpretation program available to Medi-Cal patients would prepare California hospitals and doctors to provide medical services for millions of limited-Eng-lish speakers accessing healthcare services in the coming years, according to news reports.

UcLa, Usc study Looks at results of patient-centered programs

New findings of a joint study conducted by the University of California, Los Angeles, and the Uni-versity of Southern California showed that patient-centered programs and coordinated care can sig-nificantly improve satisfaction scores for residents in training and patients alike.

The study, published on Sept. 2 in the Journal of the American Medical Association (JAMA) Inter-nal Medicine, outlined how the program known as the Galaxy model can work effectively in pub-lic settings. Funding was provided by a three-year $750,000 grant from UniHealth Foundation.

La sheriff’s Department recognized for telemedicine program

The Los Angeles County Sheriff’s Depart-ment (LASD) Medical Services Bureau recently received an award for successfully implement-ing a telemedicine pilot

program that offers healthcare providers more se-curity while reducing transportation costs.

A pilot telemedicine program, adopted in 2007, that sought to address costs and security chal-lenges associated with removing patients from jail while providing a constitutionally required level of healthcare turned out to be a success, according to a statement by AMD, a telemedicine company based in Chelmsford, Mass.

two La elderly care Facilities to Benefit from scan Grant

SCAN Health Plan, a Long-Beach-based HMO that serves seniors, recently awarded a $2 million grant that includes funding to two facilities in Los Angeles to help provide better managed care to elderly who live independently.

The grant, made to the Alliance for Leadership and Education from the not-for-profit health plan, will fund the delivery of home health services for those who qualify for both Medi-Cal and Medicare services, or dual eligible patients, through the state’s Community-Based Adult Services (CBAS) program.

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new ehr system touts Better security and access to Data

The chief of a Newport Beach-based medical device company, Appvantage Medical System LLC, announced last week that his firm is working on a new electronic health records system (EHR) that will allow doctors to securely access health-care data from any device at any time.

state Doctors File complaints about payers’ Use of credit cards

Some California doc-tors have filed complaints on the growing trend of plastic and virtual credit cards used by payers, in-

cluding the Department of Veterans Affairs, that end up costing doctors hidden fees and resulting in lower than the negotiated price for services, ac-cording to news reports.

Rosario Ortega, Membership Outreach Rep-resentative at the Los Angeles County Medical Association (LACMA), said he was not aware that

LACMA has received any doctor complaints on the credit card issue yet.

But the American Medical Association has re-portedly taken action after receiving complaints from doctors in California and other states, includ-ing smaller practices that do not accept credit cards.

three Local Doctors sought for radiation training program in hiroshima

Dr. Susan Reynolds, president and CEO of the Los Angeles-based Institute for Medical Leadership, is looking for three Los Angeles or Orange county doctors to participate in a special radiation train-ing program in Hiroshima, Japan. The trip will take place Oct. 28 to Nov. 1, with all expenses covered.

“The HICARE Training Program, or Hiroshima International Council for HealthCare of the Radi-ation-Exposed, brings together Japanese medi-cal authorities and doctors from around the world to make use of the experience and knowledge of physicians and researchers for all radiation-ex-posed people in the world,” Dr. Reynolds said.

read full sTories aT phYsiciansnewsneTwork.com

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Bills to Increase Number of Physicians in Rural, Underserved Areas Signed by Governor BrowncmA StAFF

TwO Bills ThaT would put more physicians in rural and underserved parts of california were

signed by governor Jerry brown. Sb 21 and Ab 1288 were both sponsored by the california medical

Association (cmA).

the 2013-14 state budget included a $15 million annual appropriation to fully fund the University of california riverside School of Medicine (Ucr SoM). the Inland empire, including riverside and San ber-nardino counties, is experiencing the lowest supply of physicians per capital than any other region of the state. Allocating a continuous funding source for Ucr SoM helps to ensure that more physicians are graduat-ing medical school and practicing in the communities where they’ve been educated.

Sb 21 (roth) takes it a step further, by requesting the Ucr SoM to identify eligible medical residents and assist them with applying to physician retention pro-grams, including the successful Steve thompson Loan repayment Program (StLrP). the StLrP pays medical education debt up to $105,000 in exchange for a com-mitment to practice for at least three years in an under-served or rural part of the state.

“Sb 21 will help provide medical students access to residency programs and funding they need to continue their service and commitment to the critical healthcare services needed by the people of Inland Southern cali-fornia,” said Senator richard D. roth (D-riverside).

“establishment of a funding source for the Ucr SoM is a huge step in the right direction,” said Paul r. Phinney, MD, cMA president. “Additional solutions such as Sb 21 will only help to increase the number of physicians in the areas that need them most. cMA ap-plauds Senator roth for his commitment to the issue.”

Ab 1288 (V.M. Perez) also aids in getting more physicians to areas where they are needed most. the bill requires the Medical board of california and the osteopathic Medical board of california to develop a process giving priority review status to the applications of physicians who can demonstrate that they intend to practice in a medically underserved area or serve a medically underserved population.

“there are physicians ready to serve patients in ar-eas where access to care is tough, but cannot do so because of delays in the licensing process. Ab 1288 puts these applications at the top of the pile, speed-ing up access to care for patients who need it most,” added Dr. Phinney.

Ab 1288 will not change the vigorous standards of the Medical Practice Act, but will instead focus the board’s resources on the areas and populations with the greatest need.

“rural and underserved areas face a number of bar-riers in recruiting and attracting physicians, but slow state bureaucracy should not be one of them,” said Assemblyman V. Manuel Perez, who represents the coachella and Imperial Valley’s of southeastern cali-fornia. “Ab 1288 will help build the ranks of qualified physicians in medically underserved communities and it is one part of the solution to address the medical workforce needs facing our state as we approach the implementation of the Affordable care Act.”

In addition to Sb 21 and Ab 1288, Ab 565 (Salas) broadens eligibility for the StLrP to encourage more physicians to move to underserved areas. the bill passed the Legislature and is awaiting signature from Governor brown.

“People in rural communities deserve the same high-level of access to quality doctors as those in other parts of the state,” said Assemblymember Salas. “this bill will alleviate the shortage of physicians found in so many rural communities throughout the central Val-ley by incentivizing new doctors to stay in medically underserved areas.”

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increase the num-ber of physicians in the areas that need

them most. cMA applauds Senator

roth for his commit-ment to the issue.”


Legislature Passes CURES Bill the california Assembly has unanimously passed a bill (Sb 809) that will provide $9

million annually to upgrade and maintain the controlled Substances and Utilization re-view and evaluation System (cUreS). cUreS is an online database that allows authorized users, including physicians, pharmacists, law enforcement and regulatory boards, to access information about a patient’s controlled substance prescription history. the bill now heads to the governor’s desk.

the california Medical Association (cMA) changed its position on the bill from neutral to support after negotiating significant amendments to the bill that will make it easier for physicians and other prescribers and dispensers to access real time data. Among the amend-ments are requiring the DoJ to work with the Medical board of california to establish a streamlined enrollment process for physicians and other authorized users; and requiring the DoJ to establish policies, procedures and regulations for “use, access, evaluation, manage-ment, implementation, operation, storage, disclosure and security” of the database. cMA also negotiated a clarification of the value of cUreS as a clinical tool as opposed to being strictly a law enforcement tool.

registered users can access cUreS to verify a patient’s controlled substances history before prescribing and the information can be used to help identify a patient who may be “doctor shopping.” the system entrusts that well-informed prescribers and pharmacists can and will use their professional expertise to evaluate their patients’ care, prevent inappropri-ate use of drugs and assist those patients who may be abusing controlled substances.

contact: Alecia Sanchez, (916) 551-2878 or [email protected].

HELP SEt CMA PoLiCy: aLL members Invited to

Provide online testimony on resolutions and reports

The California Medical Associa-tion’s (CMA) annual House of Delegates (HOD) will convene in Anaheim at the Disneyland Hotel on October 11-13, 2013. The HOD is CMA’s legislative body and establishes the policies that govern the association.

At this year’s meeting, physicians from across the state will debate and set policy on important health care is-sues including immunization reporting, Medicare reimbursement, implementa-tion of the Affordable Care Act and non-physician provider scope of practice. During the three-day meeting, the 500 delegates will address nearly 90 resolu-tions on these and other key issues that affect the practice of medicine.

CMA invites all members to visit its online forum to submit written testimo-ny on the resolutions and reports that will be considered by the delegates. To do so, click on “House of Delegates,” at the top of this page. This will prompt you to log in (if you are not already logged in) and then will take you di-rectly to the HOD landing page. (You can also use the shortcut www.cmanet.org/hod, which will prompt you to login and then will redirect you to the HOD landing page.)

To submit testimony, click on the res-olution name under “Resolutions and Reports” and then scroll to the “Submit Testimony” section at the bottom.

As a first step toward a “virtual” reference committee process that will enable a shorter, two-day meeting in future years, there will be no onsite hearing for delivery of oral testimony on business assigned to Reference Com-mittee A (Science and Public Health) and all testimony must be submitted online no later than 11:59 p.m. on Octo-ber 3. The deadline for online testimony for all other business is 11:59 p.m. on October 8.

If you have any questions, please contact the CMA member help center at (800) 786-4262 or [email protected].

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This OcTOBeR MaRks the initial open enrollment period for Covered California.While California’s new health insurance marketplace expressed confidence that its website will

be ready to take online sign-ups as scheduled on Oct. 1, Los Angeles County physicians feel less reassured about what to expect.

With an estimated 700,000 newly insured Los Angeles County residents looking for healthcare providers and services starting Jan. 1, 2014, in an environment where hospital emergency rooms are overcrowded and doctors in short supply, the Affordable Care Act will hit us like a tsunami.

To make matters worse, physicians with established practices in underserved communities may not be included in provider networks.

This is a major concern for doctors, their patients and for LACMA.I will represent LACMA doctors and their concerns, surrounding the implemen-

tation of the Affordable Care Act, during a panel discussion at the Autry National Center of the American West.

This special event, which will be held from noon to 2 p.m. on Oct. 3, will be broad-cast live by L.A.’s all-news radio station KNX 1070, backed by CBS News.

This provides a unique opportunity for LACMA’s voices to be heard not merely by stakeholders and the public in the Los Angeles and Orange Counties, but all the way to Santa Barbara and the Mexican border.

This October, I’m also honored to present the second annual LA Healthcare Awards fundraiser for the newly launched Physicians for Patients Foundation of Los Angeles County.

The inaugural event was a tremendous success. I look forward to bestowing this year’s awards to L.A.’s physician leaders during

a special ceremony on Oct. 17. It will be an evening of celebration not to be missed.I’m also pleased to announce another early victory, namely yet another delay of

the hastily and ill-conceived Cal MediConnect Demonstration Project in Los Angeles County.

LACMA’s continued fight to stop the dual eligible demonstration project paid off. The earliest this project will take effect will now be April 2014, another big win for LACMA.

This proves that our newly created taskforce with the Los Angeles County Podiatric Medical Society to persuade federal and health officials to cancel the ill-founded pilot program is showing positive results.

But we need more doctors to get involved. I am asking those who have not yet united with LACMA to join our efforts.We need your input, expertise and advocacy more than ever—from the expansion of provider

networks, so doctors can continue caring for their patients living in underserved communities to keeping MICRA in tact and other critical issues, we need all physicians to stand united with LACMA.

Rocky Delgadillo

Rocky DelgadilloChief Executive Officer


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MICRA PROTECTIONmICra saVes La CoUNtY PHYsICIaNs aN aVeraGe oF $87,000 aNNUaLLY - Trial Lawyers have begun their assault on MICRA, a statute enacted by the California Legislature in 1975 intended to lower medical malpractice li-ability insurance premiums for healthcare providers by decreasing their potential tort liability. If they are successful, malpractice insurance rates will quadruple. your membership ensures our victory against the self-serving trial lawyers trying to generate more in legal fees.

PRACTICE MANAGEMENT SERVICESLaCma aNd Cma staFF memBers HeLPed memBerPHYsICIaNs reCoUP oVer $7 mILLIoN IN UNPaId/UNderPaId CLaIms sINCe 2010 - How much could you be saving? Receive access to free Reimbursement Assistance, Jury Duty Assistance, Medical-Legal Resources, and E.H.R./H.I.T. support for your practice.

SAVINGS AND DISCOUNTSreaLIZe $1,000’s IN saVINGs WItH LaCma’s NeW PreFerred PartNer ProGram - Offering you a guaranteed 10% and up to 30% to 40% savings on key purchases from surgical gloves and medical supplies to insur-ance and prescriptions.

IN 2013, LACMA ALSO- Challenged the State’s Dual Eligible Demonstration Project and

was victorious in delaying its implementation

- Filed major lawsuits against Aetna and Healthnet for abusive busi-ness practices against physicians and patients

- Launched its first-ever dedicated resource center for solo and small group practice physicians and surgery centers

OUR WORK IS NOT DONE.Only through your continued support will LACMA and CMA be able to

serve members first and foremost through our advocacy efforts and ser-vices that will help serve patients and improve your bottom line.

RENEW TODAY!By now, all LACMA and CMA Members have received their 2013 dues statements. Dues are due by December 31, 2013. Please be sure to renew your membership to ensure continuation of your benefits.

DUES CAN bE RENEWED CONVENIENTLY ONLINE AT WWW.LACMANET.ORG

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TAKE ACTION TO PROTECT MICRA 1) Contribute to LACMA’s Political Action Committee (LACPAC). We must join our allies in the fight

to protect MICRA. Only a well-funded effort can be successful.

2) Become a Member: By becoming a member of LACMA/CMA, you will help to ensure that the voice of California physicians is heard loud and clear in the Capitol and beyond. Our unified voice can protect affordable and accessible healthcare for all.

Trial lawyers have begun their assault on the Medical Injury Compensation Reform Act (MICRA), a state law that keeps your medical malpractice insurance premiums at current levels. If they are successful,

malpractice insurance rates will quadruple and consumers & taxpayers in California will pay $9.5 billion per year in higher health costs.

LACMA & CMA are working for you! Learn more about the fight to protect MICRA at cmanet.org/MICRA

MICRA is the best reason why California has not experienced the regular medical liability crises suffered by physicians in other states. In Los Angeles County, where reimbursement levels are too low and the cost of

living is too high, the law keeps physicians’ malpractice insurance premiums affordable. Maintaining affordable healthcare and access to doctors and clinics is more important than financially

motivating trial lawyers to file more lawsuits.

MICRA Saves LA County Physicians an Average of $84,770 Annually


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healthcare equip-ment, represents 19% of the msci u.s. imi healthcare 25/50 index

19%

10%

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u.s. exports of medical technologies in key product categories identified by the department of commerce (doc) were valued at ap-proximately $44.2 billion in 2012, a 7.2% increase from the previous year.

Pharma is by far the largest segment of the healthcare sector, representing more than 40% of the msci u.s. imi healthcare 25/50 index as of may 31, 2013.

healthcareequipment

pharma

40%

The global medical device industry is growing rapidly, with value expected to hit $228 billion by 2015, up from $164 billion in the year 2010, marking annual growth of nearly 7%, according to a re-cent industry research report.

By The NumBers

Telehealth, personal and so-cial health products, and other healthcare-focused apps and devices, racked up $493 million in investments during the first three months of 2013 alone.

The healthcare providers and services industry post-ed a 10% revenue gain for the first quarter of 2013.

493million

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4067_CA_PhysicianMag_May2013.indd 1 4/15/13 11:47 AM

October 2013

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