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Dynamex Case

Last month, Governor Gavin Newsom signed AB 5 – a sweeping piece of legislation that will reclassify hundreds of thousands of workers as employees instead of independent contractors.

"The hollowing out of our middle-class has been 40 years in the making, and the need to create lasting economic security for our workforce demands action," Newsom said in a statement. "Assembly Bill 5 is an important step."

The bill codifies a ruling from the California Supreme Court that included a new test for determining whether a worker is an employee or an independent contractor. The landmark decision of Dynamex Operations West, Inc. v. Superior Court of Los Angeles, No. S222732 (Cal. Sup. Ct. Apr. 30, 2018) was a unanimous verdict from the court. 

Already, companies that use gig workers—including ridesharing companies like Uber—are vowing to fight the legislation in court.

The bill could also have impacts on health care, but CMA fought hard to ensure the interests of physicians were protected under the bill. CMA successfully secured an exemption for physicians from the legislation, arguing that the decision and the bill should be primarily focused on protecting lower-wage workers and that physicians should not be impacted by the codification of the Dynamex Case.

During the debate over the bill, a question was raised as to whether AB 5 would impact California’s bar on the corporate practice of medicine. It does not. The exemption made explicit in AB 5 as it pertains to physicians is comprehensive, ensuring that physicians are not unduly influenced by a corporate entity when practicing medicine. 

Dentists, podiatrists, psychologists, and veterinarians were among those also securing exemptions. However, other health care workers including physician assistants, nurses and behavioral health providers will be impacted by the bill. CMA will continue to monitor the implementation of AB 5 and its impact on physicians, patients, and the health care industry.

Lower Drug Costs

House Speaker Nancy Pelosi last week introduced a bill intended to lower the price of prescription drugs. The bill (HR 3) would allow the federal government to negotiate drug prices with pharmaceutical manufacturers to make a meaningful difference in controlling drug costs not just for seniors, but for all Americans. 

Under the current Medicare program, drug manufacturers set the prices, while all other Medicare providers (hospitals and physicians) are subject to a set government fee schedule.  CMA supports Speaker Pelosi’s bill.  

In 2016, total prescription drug spending reached $328.6 billion, more than double what was spent in 2002. One in four patients report that they or another family member did not fill a prescription in the last year because of cost.

Physicians are very concerned that patients cannot afford necessary medications that will improve their health and thus, many patients delay or forego their prescriptions altogether.

“Skyrocketing costs of prescription drugs are one of the main drivers of increased health care costs,” said CMA President David H. Aizuss, M.D. “Speaker Pelosi’s bill will allow Medicare to use its market power to negotiate fairer prices for patients’ medication and ensure that seniors, many of whom live on fixed incomes, will have access to the medicine they need.”

HR 3 would require the U.S. Health and Human Services secretary to negotiate the prices of the 250 most expensive drugs in Medicare and would impose a 65% penalty tax on annual gross sales for drug companies that refuse to engage in negotiations. The negotiated prices would be available to all purchasers, not just Medicare beneficiaries.

The bill would also cap seniors’ out-of-pocket prescription drug costs at $2,000 a year. It would prohibit pharmaceutical companies from raising prices above the rate of inflation. 

I recently had a conversation with Jonathan Barrera with Westpac Wealth Partners about the confusion around 401ks. In Part 1 of this discussion, Jonathan gives his insights to provide members a greater understanding of the constantly changing pension and retirement areas.

As an advisor to LACMA members, what is the single biggest fallacy when it comes to 401k plans?

Proper attention to detail is present with the current plan in place. Most plans we do a report card on are being charged above average fees lack the necessary fidelity bond, lack a dependable advisor/education for participants, and most participants don’t even know what they have and how to use the plan.

 What is the latest regulatory news surrounding 401ks?

401k education and accessibility are at the forefront. The industry is focusing on providing additional and cost-effective investment options that help clients to pay less in fees but invest smartly. The industry seeks to help educate participants to better understand what the plan is and how it works, how to use the plan for retirement and life events. Today more than ever participants need access to money, experience volatility and want to know how to maximize their savings.

 What traps do physicians fall into when it comes to 401ks?

We find that due to the significance of little time available to plan most physicians implement the quickest and most basic plans just to have something in place. Often fees, lack of customer service and inefficient plans in place cause physicians to lose opportunities over time. It is not apparent until someone is willing to step in and educate the physicians. Once there is a clear understanding as to how to improve benefits, services and reduce fees, a more comprehensive plan can be implemented. Taking the time necessary to understand the plan in place can amount to over $100,000 of lost opportunities over time.
 

For more information on 401ks or if you would like to contact Jonathan, his email is jonathan.barrera@westpacwealth.com

Read Part 2 of the discussion by clicking the link below.

You can now watch the replay of LACMA and LibertyID's latest informative webinar.

Many healthcare professionals are unaware of the billion-dollar scam that will affect their healthcare practice after a data breach. LibertyID, an expert in helping healthcare practices prepare for and respond to potential data breaches, shares how healthcare practices are not as prepared as they think they are because of a billion-dollar scam

The annual Los Angeles Healthcare Awards honors LA County’s top physicians, healthcare leaders and institutions for their work to improve healthcare in LA County. Honorees are individuals and organizations whose outcomes are positively impacting the lives of LA County residents and improving our local communities.

The Patient Care Foundation will also announce this year's scholarship recipients at the awards ceremony at the Four Seasons in Beverly Hills on November 8th, 2019.

The American Society of Hiroshima-Nagasaki A-Bomb Survivors (also known as A.S.A.) is a nonprofit organization based in the suburb of Los Angeles.  A.S.A. supports A-bomb Survivors in Southern California with their medical needs, health problems, and communication with the Japanese Government.

This year, the Medical Examinations for Survivors are taking place at Osato Medical Clinic and the Medical Consultations with Japanese Doctors will take place at this same clinic on November 9^th and 10^th.

On November 9, 2019, at 2 pm, Osato Medical Clinic will also host a seminar on “Medical Care of Atomic Bomb Survivors” sponsored by HICARE.

If you are interested in attending and to reserve your seat, please RSVP and email your full name.

#MotivationMondays



“Collaboration allows us to know more than we are capable of knowing by ourselves.”
– Paul Solarz