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Why Healthcare Companies Get Bigger… and Worse · The Operator | Healthcare Business

0:24
All right.
0:24
We're back today.
0:25
We're talking about one of the most
0:26
celebrated words in business.
0:29
scale.
0:30
You can't avoid it,
0:31
especially if you're on LinkedIn.
0:32
And in most industries,
0:33
scale sounds like progress,
0:35
more locations, more efficiency,
0:38
bigger footprint, better margins.
0:41
But as we've discussed before,
0:42
healthcare isn't most industries,
0:45
because when you try to scale something
0:47
that is built on trust, judgment,
0:50
mentorship, relationships,
0:51
and local culture,
0:54
you may grow the shell while hollowing out
0:56
the soul.
0:57
That was the line that resonated for many
1:00
from before.
1:01
Your latest article is part two of the
1:03
scale series,
1:04
and this one gets more operational.
1:06
What can't be standardized?
1:08
what scale is often used to justify and
1:12
what operators should actually be
1:14
measuring if they want to know whether
1:16
they're building something real or just
1:18
getting bigger because there is a
1:19
difference.
1:20
So let's start here, Larry.
1:22
Everybody says they want to scale.
1:24
I feel like that's even before business
1:26
starts, people are saying, well,
1:27
how can we scale this or when will
1:29
we scale?
1:30
But what do most health care leaders
1:32
actually mean when they say that word?
1:34
Let's make sure we understand the terms
1:36
first.
1:37
Well, let's start out this.
1:38
They almost never mean what they think
1:40
they mean.
1:41
And the reason I say that is because
1:43
the word scale has just become too
1:45
ambiguous.
1:46
It is a catch-all phrase now.
1:50
And in my experience,
1:51
which is over forty years now of watching
1:54
these things happen,
1:55
you always hear we're going to scale this
1:57
almost always means one of two things.
1:59
Either someone has figured out a genuine
2:01
model worth replicating or somebody has
2:03
raised enough capital that they're
2:04
confusing funding for proof.
2:07
And in my experience,
2:08
it's usually the second.
2:10
In healthcare,
2:11
this distinction matters enormously
2:14
because you're not scaling a software
2:16
product or AI or compute.
2:20
You're scaling humans,
2:22
licensed professionals.
2:23
These are complex patient relationships,
2:26
regulatory environments that don't care
2:28
how good your pitch deck is.
2:30
The moment I knew this word really,
2:33
really became dangerous is when I started
2:35
organizations celebrate pins in the map,
2:38
location count like it was a clinical app.
2:41
We went from twelve and eighteen months.
2:43
Everybody applauds.
2:45
It was sort of this run up era
2:47
where more was better,
2:48
more locations were better.
2:50
And nobody really did ask,
2:52
did the model hold?
2:54
what happened to the people already there
2:56
that you acquired?
2:58
How many stayed after they left and how
3:00
many are there now?
3:01
That's when scale stops being a strategy
3:04
and really becomes a story you tell
3:06
investors that we're getting bigger,
3:08
so therefore we have scale.
3:10
Where it is not,
3:11
you've heard me say this before,
3:12
buying things is not an advanced
3:15
competency.
3:16
That's the easy part,
3:17
truly doing the hard work
3:20
and scaling in its truest definition is
3:24
rigor, discipline, and agony, frankly.
3:29
In the article,
3:29
which people can find in your sub stack,
3:31
and we'll put the link in the show
3:33
notes,
3:34
you say some of the most valuable things
3:36
in healthcare cannot be scaled through
3:39
standardization,
3:40
like other businesses or industries.
3:42
What are some of those things that cannot
3:44
be scaled?
3:47
Hey, Jimmy,
3:48
I lost you there for a second.
3:49
Can you do the question too?
3:50
Go to question two again.
3:51
Yeah, something happened.
3:52
We got to talk to you.
3:54
Yeah.
3:54
So in the article on your Substack, which,
3:56
by the way,
3:56
we'll put the link in the show notes,
3:58
you say some of the most valuable things
3:59
in health care cannot be scaled through
4:02
standardization,
4:03
like under other industries,
4:04
because health care is different.
4:06
What are some of those things that cannot
4:08
be scaled?
4:09
Yeah, I'll give you four of them.
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And I think they're my top four.
4:13
First is clinical judgment.
4:15
And that's the capacity of the therapist,
4:17
the dentist,
4:18
the doctor to not only decide clinically
4:21
what's going on, but to read a room,
4:23
to adapt to the patient,
4:24
decide what protocol needs today.
4:27
When do you need to listen more?
4:29
When do you need to have hands on
4:30
more?
4:31
You can train for this,
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but you can't systematize it into a
4:35
workflow.
4:36
The second is trust.
4:38
And that's
4:39
runs rampant throughout an organization.
4:41
That is the currency that matters.
4:43
Between a patient and a clinician,
4:45
for example,
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between a clinician and their manager,
4:48
their business person,
4:50
between the front desk and corporate,
4:52
trust gets built locally
4:55
over time through repeated interactions.
4:57
But you can create conditions for it,
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but you can't scale for it.
5:00
You cannot mandate trust from a home
5:02
office.
5:03
So we have clinical judgment and trust.
5:05
The third is culture.
5:06
Culture doesn't travel in a memo.
5:09
People get this wrong because they try to
5:11
say we have great corporate culture,
5:13
while not recognizing that microcultures
5:15
within individual locations matter.
5:18
They matter a lot.
5:20
It doesn't scale at the speed of a
5:22
rollout.
5:23
It scales at the really how deep is
5:26
the bench of management and appreciation
5:28
for it.
5:28
Most management teams don't have that
5:30
bench.
5:30
They have slides.
5:32
So after clinical judgment,
5:33
trust and culture,
5:34
I would say the last one is under
5:36
the group of call it mentorship or tacit
5:39
knowledge skills.
5:40
And these are the, you know, an example,
5:42
the senior clinician who pulls in.
5:44
you know, a PT, you know,
5:46
new PT asides on a Tuesday and says,
5:49
you know, when this comes up,
5:50
here's what I would do.
5:51
It's the interactions that don't happen in
5:54
any kind of standard operating procedure.
5:56
It's the way people joke with one another.
6:00
A little bit of that is culture,
6:01
but it's really about how to get along,
6:03
teamwork, collaboration, tacit knowledge,
6:05
what we call the new smarts in our
6:07
company.
6:08
But that's half of how clinicians actually
6:11
develop, if you think about it,
6:13
through all those collaborative efforts.
6:15
Strip that out of the workforce and you're
6:19
in trouble.
6:20
So those four things, I think,
6:22
are the most things we take for granted
6:25
that we try to inculcate or indoctrinate,
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but we can't.
6:30
You cannot scale those.
6:31
You can only enable them.
6:33
Yeah.
6:33
Well, some,
6:34
a quote from the article was the playbook
6:35
transfers process.
6:37
It does not transfer judgment.
6:39
That sort of feels like anybody can write
6:41
an SOP when this, then this,
6:44
then this it's everything else it's
6:46
experience,
6:46
which is what we actually provide the
6:49
service.
6:51
So what does that look like in the
6:52
real world?
6:53
The playbook transfer process,
6:55
it does not transfer judgment.
6:57
yeah and the longer you know sort of
6:59
the longer you're in a multi-site
7:00
environment you know the more obvious that
7:02
becomes so let's talk about processes
7:05
documentation steps workflows how do you
7:08
onboard a patient how do you handle a
7:11
denial how do you close out the day
7:13
all that travels actually pretty well you
7:15
can put in a binder you could push
7:17
it through an lms you could measure
7:19
compliance against it you can retest for
7:21
it and you can truly scale a lot
7:24
of process
7:25
But judgment is what happens when the
7:26
situation doesn't match the binder.
7:29
It's the clinician who reads a patient and
7:31
knows that the standard operating protocol
7:34
is wrong for that particular visit.
7:37
Sort of the office manager who sees three
7:39
subtle things go sideways on a Tuesday
7:41
morning and doesn't need to call
7:43
corporate, doesn't need the binder.
7:45
They act and they act with pride and
7:48
values and support of the organization.
7:51
It's the regional director who knows,
7:53
you know,
7:54
which conversations do I need to sit down
7:56
and have an adult conversation or what can
7:57
I do by text or what can I
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do, you know, over video?
8:01
And the reality is there are just hours
8:04
and hours of variation to all this.
8:07
And patients don't fit into a box.
8:10
And so staffing situations don't resolve.
8:13
The binders are great,
8:14
but the activity is the relationships.
8:17
And you don't ship that in an acquisition
8:19
packet.
8:20
You can't put that as part of your
8:21
integration team.
8:23
And at the end of the day,
8:25
those are the things that really matter
8:27
and leave a clinic running well.
8:29
Now,
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I like to say you need owners locally,
8:32
whether or not they're actual equity
8:34
owners or they act like an owner.
8:36
That is more than just a statement.
8:38
That actually is implying to an
8:40
organization,
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I'm not good enough to scale,
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therefore I'm gonna entrust it to an owner
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who will take clinical judgment,
8:48
who will take trust,
8:49
who will take mentorship and tacit
8:50
knowledge skills,
8:52
and truly put them in an aura or
8:54
an environment where it matters,
8:56
then you don't need to worry about scale.
8:57
You've got local autonomy,
9:00
accountability within structure,
9:02
and you really have a tremendous operating
9:04
platform.
9:06
Let's talk about culture because that word
9:08
gets thrown around a lot.
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I think it's one of those words where,
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like you said in the beginning,
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people think it means something,
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but it's actually something else.
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Why do so many organizations confuse
9:17
culture with branding, colors, logo,
9:20
pizza parties, funny things that they do?
9:24
That feels like that's what you see,
9:26
but that can't be culture.
9:27
So why do so many organizations confuse
9:30
culture with branding?
9:32
Yeah,
9:33
it's because branding is a little bit
9:34
easier to produce and, you know,
9:36
culture is really hard to build.
9:38
But even back to branding for a minute,
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branding has a true economic equation.
9:42
It is the equity value above and beyond
9:45
your book value.
9:46
So Coke's value as a brand,
9:48
Google's value as a brand,
9:49
Apple's value as a brand is much greater
9:51
than their equity value.
9:52
It's sort of like the word scale.
9:54
We now take branding to mean so many
9:56
other other things.
9:58
And you're exactly right.
9:59
It's a value statement on a wall.
10:00
It's a logo.
10:01
It's a
10:02
set of core values in a lanyard, right?
10:05
Hashtag that the marketing team does and
10:08
all of those things.
10:09
You can show it actually branding
10:11
standards and things.
10:12
We have those and you show them on
10:14
slides, right?
10:15
But culture is much more different.
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Culture is literally how does the team act
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when leadership isn't watching.
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And you know what?
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Most of the time in business,
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particularly healthcare,
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the leader isn't typically watching.
10:29
It's how the manager handles a complaint.
10:31
It's their emotional intelligence,
10:33
if you will,
10:34
whether a clinician feels safe with a
10:36
difficult conversation or confronting or
10:39
flagging a problem.
10:41
What gets rewarded informally is your
10:44
culture.
10:45
What gets quietly tolerated can become
10:48
your culture.
10:49
How the front desk treats a frustrated
10:51
patient at four fifty p.m.
10:54
on Friday.
10:55
That's your culture.
10:56
You can't produce that in a quarter.
10:59
You have to build that.
11:01
over years and here's where the confusion
11:03
between branding and culture,
11:04
I think it's really destructive.
11:06
When a platform grows quickly,
11:09
leadership starts looking at ways that
11:12
they transmit culture,
11:14
which to get it again at scale and
11:16
because the real thing takes too long,
11:19
they default it to a shortcut.
11:21
You know,
11:22
they commission a values exercise,
11:23
they print the t-shirts,
11:25
they do all the hands video,
11:26
they mistake the package for the product,
11:28
and the team notices immediately.
11:30
And this is a key integration area.
11:32
You want to unify things,
11:35
but also embrace and understand legacy.
11:41
I think what I try to really lecture
11:45
in my companies that are really collective
11:47
quilts of various different companies
11:49
targeted together through, in some cases,
11:52
mergers and acquisition.
11:54
And you have to honor the past.
11:56
You have to celebrate the present and you
11:59
have to embrace the future.
12:01
And culture integration cannot absolutely
12:04
be scaled.
12:04
You don't buy a company and then say,
12:07
you're going to inherit our culture.
12:08
You partner with a company and individuals
12:12
and you say,
12:13
we are going to honor your past and
12:16
understand your values.
12:18
And you know what?
12:19
We're not going to try to replace your
12:20
values.
12:22
we're going to try to augment them that's
12:24
what a true company that understands the
12:27
difference between branding and culture
12:31
you've said so many operators use scale
12:33
this term scale to justify decisions that
12:35
simply make clinicians lives worse and
12:39
clinicians are a big part of the product
12:40
and if their lives are worse they might
12:42
leave and then your organization gets
12:44
weaker so what are the most common
12:46
examples of using that scale to justify
12:50
maybe poor decisions
12:51
Yeah.
12:52
So what I tell folks in integrations of
12:57
companies,
12:58
there are minor issues that will change.
13:00
We might change your payroll vendor.
13:02
You won't even blink at, you know,
13:04
but you need to understand there are those
13:06
that are a little bit more difficult to
13:08
change.
13:08
And you're going to say,
13:10
But we're going to sit down and have
13:12
a conversation and get to understand.
13:13
And then there are going to be a
13:14
third level changes over time.
13:16
And I believe eighteen months is a good
13:19
milestone marker that are harder to accept
13:22
because you didn't always used to do it
13:23
that way.
13:24
You always use this vendor.
13:25
Now we're going to ask you to change.
13:26
And here's why.
13:28
That is going to be tougher,
13:29
but we'll get through it.
13:31
But it's remarkably consistent in health
13:34
care platforms, PT, dental, primary care,
13:38
of what tries to happen.
13:40
So here are a few.
13:42
Centralized scheduling that ignores local
13:45
reality.
13:47
The markets are different.
13:48
You've seen one market and you've seen one
13:50
market.
13:50
Therefore, the reimbursement is different.
13:51
The employers are different.
13:52
The health insurance is different.
13:55
So somebody in a regional office is trying
13:57
to optimize your schedule,
13:58
but gets very little feedback from the
14:00
local office and doesn't understand payer
14:02
mix or case mix.
14:04
Doesn't understand that a new grad can't
14:06
see as much as somebody who's seasoned.
14:08
all of those different things.
14:09
So centralized scheduling is a good thing
14:12
to think about scaling,
14:14
but it has to have what I call
14:16
a healthy tension between centralization
14:18
and decentralization.
14:19
It's always harder to manage in the middle
14:22
than it is on either extreme,
14:23
but that's what adults really good
14:25
companies do.
14:26
Productivity models that don't account for
14:28
case complexity.
14:29
If I am PT and I have a
14:31
women's health therapist or a pelvic pain
14:33
therapist,
14:34
they're going to see a different number of
14:35
patients per day.
14:36
than somebody seeing garden variety ankle
14:38
sprains and low back pain or traditional
14:41
MSK stuff.
14:43
That is something that is depressing that
14:46
tries to get scaled across organization
14:47
and typically fails.
14:49
I think compensation models are actually,
14:51
that's the first one I should have
14:53
mentioned because
14:55
um you cannot centralize and scale a
14:58
compensation model because there's too
15:00
many variations to it but what you can
15:01
do is have a variable compensation model
15:04
that scales actually quite well and in
15:08
physical therapy and even dental hygiene
15:09
we try we pay we pay everybody the
15:12
same and so how do they make more
15:13
money they become a regional manager we
15:15
take them out of patient care or they
15:16
become a aging coach
15:18
And that doesn't make any sense.
15:20
You want your clinicians being the rock
15:22
stars,
15:22
being the athletes that make the most
15:25
money.
15:26
And that's just how it should be.
15:27
But in PT, particularly,
15:29
it calls itself a doctoring profession but
15:32
refuses to mature to one.
15:34
Dental and primary care and orthopedic
15:36
surgery and the like,
15:37
they made that transition years ago.
15:39
We just don't want it.
15:42
And then I think, you know,
15:44
I think the one that everybody cites too
15:45
is what are the local decision rights or
15:48
the authority around clinical decision and
15:51
centralizing all those things when they
15:53
should stay local.
15:54
Even things like supplies and labs.
15:56
I'll give you an example.
15:57
We have, you know, in the dental world,
15:59
there are tons and tons of different labs.
16:03
But the reality is you should really try
16:05
to scale it down to a handful of
16:07
them.
16:08
but then give that local clinician the
16:10
opportunity to do within the confines of
16:13
that narrowed down number.
16:14
Doesn't typically work that way.
16:16
And so, you know,
16:19
you have to have both things working and
16:21
that healthy tension around decisions and
16:23
everything,
16:24
but you're having a really clear line of
16:25
distinction between what are your decision
16:27
rights, what is your judgment,
16:30
and what needs to go up the flagpole,
16:32
so to speak, to corporate.
16:34
One of the strongest lines in the article
16:36
I thought was this.
16:36
The metric keeps counting locations.
16:38
The damage is happening inside of them.
16:40
This goes back to what you said in
16:41
terms of pins on the map.
16:44
What damage gets missed when you're paying
16:46
attention to number of locations or pins
16:48
on a map?
16:49
What damage gets missed probably before
16:51
you know something even bigger is going to
16:54
happen?
16:54
That's the heart of the problem here is
16:57
unit count is an easy metric.
16:59
You can say it on a call.
17:01
You can have ribbon cuttings and show
17:03
you know,
17:03
the local politicians with you there.
17:06
But inside those locations,
17:09
none of the things that actually determine
17:10
whether the business is healthy is really
17:12
being tracked with the same intensity.
17:15
Clinician turnover, kept visit rate,
17:18
continuity of care,
17:19
how long it takes for a new patient
17:20
to get into the door,
17:22
whether the founding clinicians are still
17:24
there or whether they're vested on and
17:25
moving out.
17:27
And in acquisitions,
17:29
traditional metrics tells you that the
17:32
typical owner stays less than five years.
17:34
Well, OK, that's one thing.
17:35
But what about our clinicians and all of
17:37
those kinds of things?
17:38
What I've seen in health care platforms is
17:40
acquisitions have been a bridge to
17:42
retirement,
17:43
not a bridge to leverage growth.
17:46
And every platform that I've seen,
17:50
when they go sideways,
17:52
the top line might keep going up,
17:54
but the bottom line gets absolutely worse.
17:58
And the operators that run those
17:59
platforms,
18:00
they can't tell you exactly what their
18:02
location count is in any given day.
18:04
But they can't tell you what the retention
18:06
rate of their clinicians are hired three
18:08
years ago.
18:09
You should absolutely know at any given
18:12
time my first year hires.
18:14
What is that retention rate?
18:16
What is it at two and three years
18:18
and what is it above three years?
18:20
And what you find is most companies are
18:22
really good at the two and three year
18:24
point because people get invested.
18:27
I'm sorry, above the three-year point,
18:29
but that middle category and the first
18:31
category are a train wreck,
18:32
particularly in this post-pandemic world.
18:36
We are confusing,
18:38
absolutely confusing turnover rate
18:41
aggregated with what it is parsed by the
18:44
number of years that you've been with an
18:46
organization.
18:47
And then second to that,
18:49
what I see is companies not including
18:52
involuntary turnover into their retention.
18:55
You know,
18:56
we had a whole series of articles on
18:57
retention.
18:58
So what happens is you make a bad
18:59
hire.
18:59
They don't pass.
19:01
Let's just say they don't pass their
19:02
licensure exam.
19:03
Well, they leave.
19:04
You have to replace them.
19:05
That is turnover.
19:06
But somehow or another,
19:07
we want to carve the bad apple.
19:09
We got rid of them.
19:10
They were a bad clinician.
19:12
That is still turnover.
19:13
It doesn't matter whether it's voluntary
19:15
or involuntary.
19:15
And I see a lot of folks making
19:17
that mistake.
19:18
So if location count is vanity,
19:22
what should smart health care operators
19:24
actually measure?
19:25
You mentioned a couple of those things
19:27
just a second ago.
19:29
So I am convinced that,
19:31
I hate boiling things down to one or
19:33
two metrics,
19:33
but I'm gonna do a couple three for
19:36
you here.
19:37
But I am convinced that the number one
19:39
is same store organic growth.
19:44
Growth,
19:45
which will be the topic of the next
19:46
article, I hope it's not a series,
19:48
but it might be,
19:49
it's because we confuse growth with
19:51
something good.
19:53
And the reality is,
19:55
Organic ,
20:05
variable costs only go up when you add
20:07
professionals.
20:08
Therefore, your margin and your EBITDA,
20:11
your cash flow, should go up.
20:14
Are the clinics getting that tells you if
20:16
the clinic's getting better or are you
20:17
masking flat performance with acquisition
20:20
and top line growth?
20:21
This one metric,
20:23
same store organic growth really separates
20:25
the real good artists from the roll up
20:27
artists.
20:28
And my fundamental belief is you should
20:30
not even qualify to do acquisitions or
20:32
mergers until you can demonstrate a
20:34
repeated same store organic growth model,
20:36
because that's what a real operator does.
20:38
All you're going to do if you don't
20:39
is buy things and ruin them.
20:42
Then what are you going to do?
20:42
You're going to get a cycle until you
20:43
buy more things until you run out of
20:45
capital and then you're over leveraged if
20:47
you're in the private equity world.
20:49
The second data would be that retention
20:52
rate we talked about at the first year,
20:55
two, three above three-year mark.
20:59
Don't game the system.
21:02
measure it.
21:03
You might not be able to compare it
21:04
with other companies because everybody
21:06
might measure it a little bit different,
21:07
but that is really, really critical.
21:09
Who is staying because they want to stay?
21:11
That's your real workforce durability.
21:13
And then the last one,
21:14
I'll just kind of call it kept visit
21:16
rate.
21:17
You know, the number of patients that,
21:19
this is a tough one,
21:20
the number of patients that complete their
21:22
You know, treatment plan.
21:23
We talked about this cliff at the two
21:25
and three visit.
21:26
You get drop off.
21:27
So I see more new patients and new
21:28
patients are good, good, good.
21:30
So you realize that you have to continue
21:32
to milk your own cows first and make
21:34
sure you've maximize not in terms of
21:36
maximize profits or maximize it.
21:37
But if your patients are scheduled for
21:39
five visits,
21:40
do they keep those five visits?
21:42
um so that captures drop off no shows
21:45
and the silent sort of attrition that
21:47
tells you whether patients are actually
21:48
finishing their care but if i was going
21:49
to add a fourth one it would be
21:51
how many as a percentage how many inbound
21:54
calls are answered of new patients because
21:57
what i see happening in the non-pt world
22:00
is generally better about call center
22:03
knowledge and
22:04
and expertise whereas in pt we don't
22:07
typically make those measurements and we
22:08
don't realize how much lost visits we're
22:11
getting because we're only answering you
22:12
know the phone eighty percent of the time
22:14
and in pt the demand is as high
22:16
as it's ever been so that's serious
22:17
numbers all right final question can scale
22:21
be done well then or is the model
22:23
fundamentally flawed
22:25
Scale can absolutely be done well.
22:29
Companies that do it well understand the
22:31
difference between systems.
22:33
They pick their battles well.
22:35
We're gonna scale and centralize five
22:37
systems,
22:37
but we're gonna leave clinical
22:38
decision-making and local decision-making
22:41
and authority rights,
22:42
decision rights to the clinicians.
22:44
And they do it really, really well.
22:46
And one of the ways I think is
22:48
important is what is their percentage of
22:51
salary, SGA, their overhead percentage,
22:54
general administrative cost as a
22:56
percentage of the overall.
22:58
And what you see is companies that don't
23:00
scale well build up overheads because they
23:02
create more and more functions for
23:04
corporate overhead.
23:05
And that's what drives clinicians in the
23:06
field crazy.
23:07
You know,
23:09
when you see overheads of ten and twelve
23:12
and fourteen percent,
23:14
you have to ask yourself, you know,
23:15
when I had my own practice,
23:16
we were at like ten percent.
23:18
Now I'm part of a bigger group,
23:20
but we're at fourteen percent.
23:21
So that's not right.
23:23
All right.
23:25
If this episode make you made you
23:26
uncomfortable, as always.
23:28
Good, because somewhere right now,
23:30
a health care company is celebrating
23:32
growth while quietly damaging the thing
23:34
that made it valuable in the first place
23:35
and then trying to repair it with a
23:37
pizza party and a T-shirt giveaway.
23:39
Scale isn't the enemy.
23:40
Scale without wisdom or forethought
23:42
probably is.
23:43
If you want to go deeper,
23:44
and you should,
23:45
Larry's full article is linked in the show
23:47
notes.
23:47
And ask yourself, honestly,
23:48
if you're on a platform,
23:50
are you building a health care company or
23:52
just a collection of health care
23:54
buildings, pins on the map?
24:00
All right,
24:00
so I'll edit these into just shorts.
24:03
All right, it's the operator hotline,
24:05
real or very real feeling calls from
24:07
people inside healthcare.
24:09
Call one,
24:11
we doubled locations in two years.
24:14
Revenue is up, but turnover is up.
24:17
Culture feels icky and patients feel less
24:22
connected.
24:23
Is this a normal state or are we
24:24
breaking something?
24:27
You're breaking something.
24:28
A normal state, first of all,
24:29
you need to look at cashflow.
24:31
What is your cash position if you're
24:32
spending all these money either on growth
24:34
of new locations and how does that impact
24:38
your balance sheet?
24:40
When you start paying more attention to
24:42
numbers of locations and acquisitions and
24:45
you have higher turnover,
24:46
that means you're ignoring the operations.
24:48
into in in turn for the opiate of
24:51
buying things which can happen because it
24:53
gets contagious and we all love buying
24:55
things whether it be shirts or things
24:57
online or companies more importantly
25:01
you're a real company when you have real
25:02
operators who handle retention who handle
25:05
engagement of their employees and who
25:08
handle success and organic same clinic
25:10
growth that's what i want to know not
25:11
how many locations you've grown to
25:14
but I can't put how many locations I
25:15
have in my,
25:16
I can put how many locations I have
25:17
in my LinkedIn profile and that's easier.
25:20
Call two,
25:21
our senior therapist trained everybody for
25:23
years, corporate standardized comp,
25:26
and she left.
25:28
Leadership says one person doesn't matter.
25:30
Is leadership wrong?
25:33
Leadership is absolutely wrong.
25:34
That's the difficulty of leadership.
25:36
It's always easy to manage at the
25:37
extremes,
25:38
treat everybody like a widget maker,
25:40
the same.
25:41
more you know enlightened companies treat
25:44
every individual as an individual you have
25:46
to have some parameters that allow for
25:48
variation you might have a public health
25:51
therapist or a public pain therapist you
25:53
might have a spine therapist you might
25:55
have somebody who does lymphedema you
25:57
might have some and you have to treat
25:58
those folks differently i'm very much
26:01
against paying everybody the same i think
26:03
that you know
26:04
plays into the commoditization factor and
26:06
the widget major factor.
26:08
And as you know,
26:09
I'm big on variable compensation for PTs
26:12
and letting our PTs make more money.
26:13
All right, this one.
26:16
We have a dashboard, engagement surveys,
26:19
productivity scorecards,
26:20
but nobody can tell me if our clinics
26:22
are actually better.
26:24
Why does this happen?
26:26
It happens because people love data,
26:28
but not insights.
26:29
The beauty of AI is that hopefully we
26:32
can prompt with appropriate questions to
26:35
create analytic expertise and provide you
26:38
insights.
26:39
For a long time in physical therapy,
26:41
we didn't even have data.
26:42
Now data has probably jumped the shark.
26:45
We have data.
26:46
We have to now create insights.
26:48
By the way, insights,
26:50
they won't serve a purpose unless they do
26:52
one thing,
26:52
lead to actions and behavior and drive
26:55
change.
26:56
All right, perfect.
26:58
All right, let me hit end.