Preparing (FINANCIALLY) for the possibility of socialized medicine

[Null]

New here, and had a question I didn't think would be answered anywhere else.

I really, really don't want this to get derailed by political arguments as it is a current hot-button topic, HOWEVER it seems really relevant to a lot of us...

 

There's a good chance of some kind of socialized medicine coming in either in 2020 or 2024, looking at many of the leading Dems' platforms.

Leaving aside the question of whether this would be good for the country, this would likely have a massive negative impact on many of our salaries, particularly specialists. (Primary care physicians might benefit!) How would you recommend preparing financially for this? Shift allocations from equities to bonds? Avoid paying too much for a house? Would we do anything differently if we were expecting a lower income and a lower tax bracket in a few years?

[Jaqen Haghar MD]

Simplify lifestyle.  Save more, spend less.  Avoid large, long-term liabilities.  Pay down debt aggressively.  So...  I guess I wouldn’t do anything different.  Just toggle the switch toward as extreme as you want to be.

If I thought there would be complete socialized medicine in 2020, I’d be working double time, eating PBJs, and livin’ in a van down by the river.

[ENT Doc]

First of all, this sort of thing takes longer than you think. At the very least you’d have court challenges that would last for years. Also, don’t underestimate what the stakeholders who oppose this will bring to the table. Turns out the blanketed conscription of millions of healthcare workers (and indirectly millions of others working in related fields) to government service isn’t very popular or profitable. Expect backlash.

I would recommend saving as much as you can. You won’t regret it.

[SkepticalOfFIRE]

Anything could happen any time. We see this on a personal level (disability, law suit, etc), with groups/hospitals closing, or states having environments unfriendly to some specialties. A change prob will come in how healthcare is distributed/administered in our lifetime.. but who knows how/what. I’m not worried about “socialized medicine” more than getting hit by a car and losing my ability to practice... Contingency planning/saving. I bet you’re smart and could also do other high paying jobs if it came down to it .

[Panscan]

Other high paying jobs later in a physicians career? What would those be? Seems a little unrealistic.

Everybody likes to think they're a rocket scientist and could be a hedge fund manager, high level this or that. In reality physicians as a job entail high levels of knowledge, not intelligence, which I don't think would translate very well to other typically high earning fields. In fact I think being a doctor is antithesis of intelligence in a lot of aspects. Medical school and medicine in general inherently emphasizes massive memorization over critical thinking.

Hubris!

[CordMcNally]

Regardless of who is in control of the government, you won't wake up to socialized healthcare. Continue to meet your current financial goals and you'll be in good shape.

[hightower]

I think it's inevitable and completely necessary that we adopt socialized healthcare like the rest of the world, but also a silly thing to fret about.  It would be good for all of us in the end as citizens...imagine how much easier early retirement would be if you didn't have to worry about paying for health insurance.  It's our biggest question mark moving forward when it comes to retirement planning.

Either way, I'm not doing anything differently regardless of who gets elected.  I currently live far, far below my means and could easily get a "normal" job paying 25-30% of what I currently make and we'd be fine paying our bills and maintaining our lifestyle.  I doubt I'd ever have to accept a physician job for 25% of what I currently make.  Just look at what docs make around the rest of the world and you'll see they still live very comfortable lifestyles, even the general practitioners.

Anyway, all of this fear of democratic socialism cracks me up.  Especially since it's mostly coming from people who are unaware that they already depend on socialism to survive (social security, medicare...).  Democratic socialism is a good thing. Maybe not if you're a multi-billionaire, but I think those people can afford to pay a bit more in taxes.  They'll still be able to live ridiculously lush lifestyles that the rest of us can't even dream of.

[wonka31]

Like ENT said, this won’t happen overnight if it happens at all. The fact of the matter is, there are so many mouths to feed in the political arena. ‘Obamacare’ was a shell of it’s initial structure/intent due to many issues, including sweetheart deals that had to be made to get enough votes. While I completely agree that massive reform is necessary, this is very difficult to be done quickly. Changing from a system that is consumption driven to one that will inevitably need a degree of rationing to stay financially viable is a huge mountain to climb for both those in the healthcare industry and even more so, our patients.

[VagabondMD]

I remember after Jimmy Carter was elected President in 1976, a sixth grade classmate of mine, whose father was a doc, was lamenting the inevitable implementation of socialized medicine and what that would mean for her father’s livelihood.

[wonka31]

Now that’s a good history lesson, Vagabond.

[Peds]

Null wrote:

There’s a good chance of some kind of socialized medicine coming

Click to expand...

Null wrote:

Primary care physicians might benefit!

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whats the problem now?

[Craigy]

CordMcNally wrote:

Regardless of who is in control of the government, you won’t wake up to socialized healthcare. Continue to meet your current financial goals and you’ll be in good shape.

Click to expand...

Idk, my boi Dr. Z got home one day...

https://www.youtube.com/watch?v=mq__Z-Z_Ofs

[Craigy]

Jaqen Haghar, MD wrote:

Simplify lifestyle.  Save more, spend less.  Avoid large, long-term liabilities.  Pay down debt aggressively.  So…  I guess I wouldn’t do anything different.  Just toggle the switch toward as extreme as you want to be.

If I thought there would be complete socialized medicine in 2020, I’d be working double time, eating PBJs, and livin’ in a van down by the river.

Click to expand...

ENT Doc wrote:

I would recommend saving as much as you can. You won’t regret it.

Click to expand...

Yeah what these two guys said.  When you have wealth you have the freedom to not have to worry about your next paycheck.

Only regret would be if we get a warren-type wealth tax and you wished you had enjoyed your savings instead of handing it over to the feds.  Slim chance but it's a theoretical possibility.

IMO there's a good possibility that socialized healthcare could make medical professionals even wealthier, at least in the short term.  Though it would likely mean more work with less pay in the long term.  There will be those that are able to play the game better than others, same as today.

As others said, in all likelihood, it's not going to happen overnight, and you'll have time to prepare.  Good news, the preparation is the same as preparing for early retirement.

[Peds]

Craigy wrote:

Only regret would be if we get a warren-type wealth tax and you wished you had enjoyed your savings instead of handing it over to the feds.

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nytimes: "the proposal is to tax a family’s wealth above $50 million at 2 percent a year, with an additional surcharge of 1 percent on wealth over $1 billion."

 

really?

[Peds]

Null wrote:

How would you recommend preparing financially for this?

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like you would prepare for any other significant decrease in income/job loss/job change/disability.

plan. ahead.