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continued from page 11 Liability insurance: Medical professionals are caught financially between rising premiums for malpractice insurance and fixed reimbursements from managed care programs, and you may find yourself evaluating a variety of approaches to providing that protection. Some physicians also carry insurance that protects them against unintentional billing errors or omissions. Remember that in addition to poten- tial malpractice claims, you face the same potential liabilities as other business owners. You should consid- er an umbrella policy as well as coverage that protects you against business-related exposures such as fire, theft, employee dishonesty, or business interruption. Disability insurance: Your income depends on your ability to function, especially if you're a solo practitioner, and you may have fixed overhead costs that would need to be covered if your ability to work was impaired. One choice you'll face is how early in your career to pur- chase disability insurance. Age plays a role in determining premiums, and you may qualify for lower premiums if you are relatively young. When evaluating disability income policies, medical professionals should pay special attention to how the policy defines disability. Look for a liberal definition such as "own occupation," which can help ensure that you're covered in case you can't practice in your chosen specialty. To protect your business if you become dis- abled, consider business overhead expense insurance that will cover routine expenses such as payroll, utilities, and equipment rental. Practice management and business planning Is a group practice more advanta- geous than operating solo, taking in a junior colleague, or working for a managed care network? If you have an independent practice, should you own or rent your office space? What are the pros and cons of taking over an existing practice compared to starting one from scratch? If you're part of a group practice, is the practice structured financially to accommodate the needs of all part- ners? Does running a "concierge" or retainer practice appeal to you? If you're considering expansion, how should you finance it? Questions like these are rarely simple and should be done in the context of an overall financial plan that takes into account both your personal and professional goals. Practice valuation You may have to make tradeoffs between maximizing current income from your practice and maximizing its value as an asset for eventual sale. Also, timing the sale of a practice and minimizing taxes on its pro- ceeds can be complex. If you're planning a business succession or considering changing practices or even careers, you might benefit from help with evaluating the financial consequences of those decisions. Estate planning Estate planning, which can both minimize taxes and further your personal and philanthropic goals, probably will become important to you at some point. Options you might consider include: • Life insurance • Buy-sell agreements for your practice • Charitable trusts You've spent a long time acquir- ing and maintaining expertise in your field, and your patients rely on your specialized knowledge. Doesn't it make sense to treat your finances with the same level of care? OB The Grandes are owners and principals of Grande Financial Services Inc., Oakhurst, N.J. They can be contacted at 800-722- 1258 or grande@raymondjames.com. Note A portion of the above material has been con- tributed by Broadridge Investor Communication Solutions Inc. This information, developed by an independent third party, has been obtained from sources considered to be reliable, but Raymond James Financial Services Inc. does not guarantee that the foregoing material is accurate or complete. This information is not a complete summary or statement of all avail- able data necessary for making an investment decision and does not constitute a recommen- dation. The information contained in this report does not purport to be a complete description of the securities, markets, or developments referred to in this material. This information is not intended as a solicitation or an offer to buy or sell any security referred to herein. Investments mentioned may not be suitable for all investors. The material is general in nature. Past performance may not be indicative of future results. Raymond James Financial Services Inc. does not provide advice on tax, legal, or mortgage issues. These matters should be discussed with the appropriate pro- fessional. Securities offered through Raymond James Financial Services Inc., member FINRA/SIPC, an independent broker/dealer, are not insured by FDIC, NCUA, or any other gov- ernment agency, are not deposits or obliga- tions of the financial institution, are not guaranteed by the financial institution, and are subject to risks, including the possible loss of principal. 12 Ophthalmology Business • October 2012