Everyone wants their business to succeed, but what does it take to run a successful physical therapy clinic? In this episode, we find out the key steps to success for PT clinic owners. Nathan Shields takes a look at eight key steps that you need to take for your clinic to succeed. He analyzes each key step and tells you what you need to know and do. Tune in and learn the secrets to a successful PT clinic here.
I want to talk about the Eight Steps to Success as a Physical Therapy Owners Club member. Some of you may be thinking, “I’m not a member. I didn’t join anything.” Let’s say you are a member because you are an audience of the show and/or a Facebook Group Member and you are passively engaged in the club so you are a club member.
I want to take this time to talk to you about what that pathway looks like for success as a Physical Therapy Owners Club member. In essence, what are the eight steps to becoming a successful physical therapy clinic owner? They are one in the same thing. The whole purpose behind the Physical Therapy Owners Club is to help you as an owner generate more profits and freedom in your business.
I want to take some time to talk about what those steps are. Some of you definitely are further along in the process. I would love to talk these out with you and see where you are and how far you have gotten. Also, look back and say, “What things do I need to do to shore up my ownership in my clinic?” Bear with me. There are a number of things that we could be talking about. I'm looking at things from a larger perspective as to what it takes to become a successful PT owner.
Let's talk about the first step. The first step that I have to encounter with most of my coaching clients is obtaining an ownership mindset. What I mean by that is many physical therapists, I included, opened up a clinic thinking, “I’m a physical therapist that now owns a clinic.” Taking on an ownership mindset flips that script and helps you recognize that, “I am a business owner that happens to own a physical therapy clinic.” I am also a physical therapist. However, what comes first if you want to be successful in your business is to recognize that you are an owner of a business, the business requires you to think that way and what is in the best interest of the business at any and all times.
As a successful business owner, your job is to give the business quality time. If we were to talk about love languages and if your business had a love language. That love language would be quality time. You must take the time that the business needs for it to run successfully. If you are treating 50 hours a week and trying to fit in business/administrative tasks in-between visits and on the weekends, inevitably, you are either going to burn out. Number two, your employees are going to get frustrated. Three, you are going to have limited growth. You might obtain some measure of financial, security or goals but you are not going to have a lot of freedom to go along with it.
If you want to take the first step towards successful business/PT clinic ownership, that is to obtain an ownership mindset and recognize that your business comes first. What do I do? How do I become a business owner? That's the second step. A lot of your training has been in physical therapy or working towards a physical therapist for twenty-plus years of your life throughout your education so you can become a physical therapist. Now I'm telling you, don't be a physical therapist anymore, essentially. What do you do to get that business training? That begins with listening to me and others. Also, reading books related to business ownership.If your business had a love language, that love language would be quality time. Click To Tweet
I’m going to toot my own horn and say we’ve got a ton of great resources over the past years at the Physical Therapy Owners Club show. Tons of great interviews from successful physical therapists and industry leaders that can teach you different aspects of successful business and administrative actions that you can take to improve your business. That’s one, but I’m not the only one out there to help physical therapists. There are others.
Paul Gough is one that I have appreciated many times. I know Devin DeBoer has one for cash-based businesses. Check them out. Listen to them. Gain what you can from them and use those as resources. It also goes toward the idea is to read more. Read the books that we have recommended here in the past that many times. Read E-Myth Revisited, Think and Grow Rich, Profit First, Traction, and Who Not How, is a great one that I read. These are all books that are number one important to read. Number two, it’s important to implement.
Many people have read all the books, done all the things but haven't taken the time to implement them. Thus, they haven't progressed in their ownership path. Take the time to read the book once, twice, maybe three times, come back and implement, and take the time to implement those recommendations in those books and those shows. How do you do that if you are treating full-time? That's the third step. You've got to cut back on your treatment time.
You’ve got to take the time to implement the strategies that are recommended. If you are not taking any time now to do administrative tasks, it's got to start with at least half-day a week. I recommend two half days per week to start with. During that time, you will implement these strategies. You will plan appropriately, hold people accountable, develop policy and procedures, which we will talk about later on. These are the things that you do with your administrative time. Even though you haven't had any business training, you can start doing some of these things.
Taking the time to implement business practices and improve your business will take you a long way. I didn't see a lot of gains in my business until I stepped out of treating a significant amount of time so that I could work on my business, not just in my business. That's the third step. Take the time to step away from treating and putting the time to work on your business.
The fourth step, leverage your network. What do I mean by that? Number one, you have to be a part of a network. That could be the Facebook group of the Physical Therapy Owners Club. That could be a peer-to-peer network from the private practice section of the APTA where you meet with other physical therapy owners that could be joining entrepreneurs' organizations, which is a small business network that Will and I joined, and had a ton of success with when we recognized that we needed more training in business. This is another group.
You could even join local Rotarians or Lions Club. These are networks that you can use to interact with other business owners and share some of your concerns, issues, ask questions, if you will, especially on the Facebook group. We had a lot of great questions on there from private practice owners. That's where you can leverage your network, ask questions and get advice.
Many times, as an owner, you can feel like you are alone on an island dealing with things that no one else has dealt with. That's not the case. Even people in other industries are dealing with similar issues. You must recognize and lean on their experience to overcome the obstacles you are dealing with. That's the fourth step.Training is invaluable and helps you generate physical therapists that are both value-aligned and part of the clinic's culture. Click To Tweet
The fifth step, hire a coach or get a consultant. Whatever you need to have someone to guide you, hold you accountable or give you feedback and support on a routine basis. It might be somewhat self-serving of me to do that because I am a coach for PT Owners at this time but I can tell you that I'm not here in this place. I have not gained the success that I have without the help of coaches, mentors and consultants in the past, who have helped me. In fact, even now, as I'm coaching others, I have a coach of my own because I know their value.
I have spent hundreds of thousands of dollars on coaches in the past and it has gotten me to the point where I am. I wouldn't trade a single dollar for any of that experience that I have had, the training that I’ve got and the wisdom that I learned. I find that a majority of owners out there, I would say 96% to 99% if I had to put a number to it of successful owners out there have had some coaching or consulting in the past to get them to the level that they are successful. Hire a coach or a consultant.
The sixth step, develop policy and procedure. This is how we do, blank. This is how we collect copays, maintain a higher arrival rate, treat patients, treat shoulders, order supplies and clean. That policy and procedure manual that you develop on how we do things is something that lives beyond you and allows others to do those things the way you would do them if you did them and do that at a successful level without your physical presence. That’s the magic of policy and procedures. It gets you to a point when instituted, followed and utilized to a point where you don’t have to be there. That gives you freedom.
If you have read to any of my reality show with Avi Zinn in the past. I followed him for the past couple of years in his ownership journey from a young owner. His success thus far to the point where he hardly steps into the clinic more than once or twice per week is all due to the fact that he spent a significant amount of time establishing policy and procedure for his therapist, front desk, managers to follow.
As they follow that, his involvement is less and less necessary because they stick to the policy and procedure manual, and rely less on Avi to be the answer man for everything. Developing policy and procedures for the front desk, training and onboardings, recruitment, treatment, you name it. Policies and procedures for all those things take time but when you do them, it starts to organize the chaos and give you the freedom that you need to be the visionary for your clinics.
The seventh step, find your next physical therapist. You have stepped out of treatment. You have done all these things to organize and progress your clinic. You need to find a physical therapist to take over some of those patients and come on full-time. Most importantly, hire physical therapists and train them appropriately. Train them how you would treat patients.
They don't have to use the same techniques. I shouldn't say that many times, they do prefer you have certain techniques or training if you are going to treat certain patient populations. Train them on how you greet patients, how we keep patients all the way through their full plan of care, how we discharge patients, how we ask patients for referrals a family and friends, how to interact with the front desk, how to schedule patients and how to do their EMR. All of that training is invaluable and helps you generate physical therapists that are both value-aligned and part of the clinic's culture.
Not only hiring the physical therapists but training them accordingly. The eighth step, work on building up that business more. In most of your situations, if you can get to 4 to 5 physical therapists running full time, you are in a magical profitability state and a place of freedom. As you grow from 1 to 2, you are increasing in size, essentially, 100%. 2 to 3, you are growing at 50%. 3 to 4, that's a 25% increase.
The pain is less as you add more physical therapists. On top of that, whereas you get to the 4th and 5th physical therapists, your fixed expenses, rent utilities and EMR systems stay about the same outside of salaries. Once you get past that third physical therapist, the revenue generated by the 4th and 5th therapists goes straight to the bottom line outside of their salaries because all other fixed expenses are fixed.
Getting to that place where you can get to 4, maybe 5 physical therapists will require some effort. That's where you need the time to spend on marketing strategies to the four buckets, physicians, community, past patients and current patients. Have a marketing strategy for each bucket to generate the new patients necessary for 4 or 5 physical therapists.
Also, what you need to do to generate a culture that breeds a patient-friendly environment, keeps the patients engaged and keeps the physical therapists engaged will require a lot of work. You can't be treating patients full-time if you are going to do that. As you get to the 4 and 5 physical therapists, make that your goal because the profitability is great.
Considering you have done all of this. Maybe you have reached all these steps, you are well on your way or you are at the 7th and 8th steps. What do you do after that? Essentially, it comes down to duplicating what works and eliminating what doesn't. When it comes to policy procedure and personnel, you’ve got to duplicate what works and eliminate that, and those that don't, then you can start looking at expansion either in terms of square footage or another location. Again, duplicate what works in that first clinic, take that marketing strategy, take the therapists and the personnel that are aligned with you, take the policy and procedures that work, cut and paste into the next clinic and you do that over again.
That's what you see a lot of successful multi-clinic or large clinic owners do. Duplicate what works and eliminate what doesn't. I could have spent a lot of time in these eight steps talking about the importance of establishing purpose and values, KPIs or stats, reviewing stats and establishing battle plans based on those stats. We spend a lot of time on necessary meetings.
To get to this point, I wanted to give you an overall picture of what those eight steps look like because along the way, you are going to have to address those things anyways. Purpose and values being foundational aspects. Statistics are necessary to know when to grow next. Those are the things that a coach can teach you and you can learn from your networks and books. Inevitably, you have to establish those things along the way but they are super important.
I want to look at from a global perspective, a higher-level perspective as to what it takes to become a successful PT Owner/Physical Therapy Owners Club member. Remember, you are already one because you are an audience. You are well on your way because you are an audience and taking advantage of the resources that are out there for you.
I recommend you follow this path to success. If you are along the path already, keep moving and know what your next step is. My goal for each of you that are reading is to obtain the freedom and the profits that you want from your clinic so that you can fulfill your personal purpose and goals for yourself and your family. I hope you do so by following this path to PT clinic ownership. Have a great day.
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In these challenging times, one of the questions that go over the mind of every business owner is how to thrive in the post-COVID market. Blaine Stimac, PT of Health Rehab Solutions was one of Nathan Shields’ first guests on the podcast two years ago. Now he's back to share more wisdom! At the time of their first interview, he had just over 20 clinics but has since expanded to over 30, with more clinics to open in 2020 despite COVID-19! The pandemic did have a short-term impact on his business, but now, three months later, almost all of his clinics are back to full-scale operation. The slow-down gave him and his team the opportunity to "reset," reconsider how they were doing things, and improve their systems, teams, and marketing programs. Now, they're stronger than they were prior to COVID and are ready to expand while other clinics are still ramping back up. Today, he shares the three areas in which owners should consider making significant changes to improve their business.
I've got a returning guest from way back at the beginning of the podcast. He is Blaine Stimac, CEO of Health & Rehab Solutions. He shared his story in how he grew from one clinic to over twenty clinics at the time, and he's continued to grow since then. I'm excited to bring him on and to not only share about his growth and what he's done but also to break down how they at Health & Rehab Solutions got through the pandemic and what they've done to come out of it to be super successful. Thanks for coming on, Blaine. I appreciate it.
Thanks for having me. It’s good to be back.
Share with everybody a little bit about what you've done over the past couple of years with Health & Rehab Solutions. If this is the first time for anyone reading about Blaine, I recommend you go back and read his story because it hasn't always been rosy pictures, dandelions and butterflies for him through the years. He went through his own challenges for sure. Bring us up to speed. What has happened over the last couple of years?
We’ve built HRS and started it in 2012 with the intention to partner with physical therapists, either existing and/or aspiring with the idea of bringing together their passion for physical therapy with good business practices. As we know, being a great physical therapist does not guarantee success in private practice. Our intention in having been one of those early practice owners in having gone through that, and battled the first handful of years in private practice, it became our intention to try to increase the success of private practice owners in general. We're definitely big champions of the whole private practice, being owned by physical therapists and even doing things a little bit. We liked the entrepreneurial spirit, so we're trying to build and grow that. That was the intention of HRS. As you said, when we spoke last time, we had around 20 or 22 clinics or so. At this point in time, we've added a handful more partners.
Each one of our partners themselves has a growth strategy and is expanding. We're also expanding with new partners. Some with de novo startup situations and another good acquisition with a partner. In the meantime, since HRS went through its own growth phase as any company does, we've been able to put a stronger corporate team around us. We've been able to put stronger training, lineups, methods, and different ways that we work with our partners and our whole team that invest in their growth, their success, and things we didn't have in our early days. We've been building this with the idea that we could continue to partner with more physical therapists and accomplish our intention of helping along those lines.
You're in multiple states. Which states are you in now?
We're in Colorado, Arizona, Washington. Montana is our original state where our corporate office is at.
First of all, congratulations. That's great to hear the growth and the continued growth and success that you have with other partners and PT owners.
Thanks, I appreciate it.
I want to make this relatable to the standalone PT who has his 1 or 2 clinics and another PT at a smaller scale. Number one, how did you guys survive through the pandemic? Also, share with us what some of the struggles and what you've done successfully to come out of the pandemic situation to make sure your clinics are successful?
Every difficult situation has a silver lining to it. I certainly would never wish that we would ever go through a pandemic again. However, it does create moments to look for areas of improvement. It also creates a moment for you to take a look at where your practice might not have been strong and what does it take to succeed going into the future? I've almost been doing this for many years and when things went down a path that I didn't either see coming, none quite like COVID, but nonetheless it's a moment where it exposes an area of needed improvement.
I'll use the term weakness because I don't think weaknesses is a negative thing. I think it's an opportunity to strengthen and to grow. In any area where we have a weakness is an area that we could get better at. Not from a negative thing, in the way that it might define someone or make them less, but it's an opportunity sometimes for us to look at that and realize how to get back and grow from that. We see that and tried in athletics. It's applicable in business. There are silver linings in this whole thing and there are things that a practice owner and maybe some of your readers might find that, “What do I do from this point?”
It's already happening and we can't change it. These are things that had in place on the front end. Most certainly, you would have made it through better and have made it through stronger, but that's water under the bridge at this point. The key becomes, how do I move my practice into that kind of position now and coming out of it as things start opening back up? How do I position my practice to be able to deal with challenges? It's going to make it stronger and good times and it's going to make me get through the bad times a little bit better because there are always going to be some challenges somewhere.
No one could have seen this coming and there are still questions as to whether or not we're going to see more spikes that lead to more full-scale shutdowns. I know states are starting to close bars, theaters, and the gyms back down again as they're seeing these spikes. Who knows what's going to happen once the winter comes around and the next virus comes out? There are a lot of unforeseen things out there, but there are things that we can do as owners to prepare for those unforeseen events. Take advantage of the opportunities that we have. That's why I'm excited to bring you on. I want to know what you guys at HRS are looking at.
Every one of us goes through certain growth cycles as a practice owner, as a leader, as the key manager executive of that company. I think the key thing that practices and owners need to look at this point in time is when you're coming out of this and rebuilding back up is to look at the strength of your team. I've definitely gone through multiple times when I've had to look at this myself at various stages in my time, growing and trying to get better at doing what we do. I’m realizing that if your company is made up of a bunch of below-average people, the net result of your company is going to be below average. Sometimes, we, as practice owners and business owners, don't realize that we have to invest a little bit more on our team and we have to be able to address the quality of our team a little bit more. What also happens is the last strong the team is, the more it overloads the owner as well, which, unfortunately, it has secondary effects in other areas of the company, like marketing and other areas are not as good.
It has a negative result. As we take a look at that and look at what was the quality of the team before, and what is the level of the team that you need to win going forward? What is the level of the team that would make you excited again? It has to do with not only the people you hire but then also, “How well do I train them? How well do I invest in them when they come in?” One of the other key things in that area too is not only, “Am I investing in them?” One of the areas that we see with practices and I'm sure you see it a little bit in the time that you've been in the role of a practice owner as well, the number of practices and in your coaching role, where it's so critical for owners to learn how to make good clean expectations with their staff about what's needed. I have a tendency that when we hire someone on average, they're going to do about 80% of what you need them to do. The old classic 80/20 rule.
If you do nothing, they will come in, and very rarely they are going to come in, nail it and do everything you need them to do. If you expect that they're going to come in and only do 80% of what you need them to do, then it becomes our job. The more skilled we are as being leaders and in a good sense of not just managing people, then we can get that other 20%. We must first define it well with them, explain to them what's needed and wanted, help them get the skills and training needed to do it, and then expect them to do it. That's the hard part. One thing as PT that I always say is it's a double-edged sword. We're suckers. We care so much about people that we usually will bend over backwards in a way that doesn't always help us. It's that pure care factor and that desire to help that also is what's special about what we do.
I love with our partners and the people we partner with is they’ve got a huge care factor. It also though, makes them a little bit of a sucker over here. It makes it a little bit as they get to a second that they have to learn. That cool thing is you can't make someone care, but I can teach them or we can grow in these other areas. I'd much rather be a little bit on that end, but generally speaking, that's a key area. As owners, we look at the outside of the other side of this and go, “How do I strengthen that? Could I do better myself as far as making better expectations?” If we expect people are going to come in and nail it and then they don't, we're upset. If we expected him to come in and only do 80%, then we are prepared.
I had that same conversation with a coaching client and I said, “You're looking at a new graduate. A new graduate expectation probably shouldn't even be at 80%.” He's looking at a new graduate coming in. I'm like, “What can you tolerate? Could you tolerate if he eventually got to 75% to 80% of what you do?” He's like, “He never gets 100%.” I said, “I know he's not going to be the owner and run all the departments, but productivity-wise, seeing patients, could he do 75% to 80% of what you could do?” He's like, “He could do that.” I said, “That's a reasonable expectation. You shouldn't expect that he's going to come in and do 100% of what you, as the owner has personally and financially invested in the business will do.”What are you doing differently in your business because of COVID? Click To Tweet
Keep your expectations relatively low initially, but then focus on trying to squeeze out the other 10%, 15%, 20%. In some cases, those typically end up being your future leaders, if they're able to get to a high productivity level. We had that exact same conversation. To go to your care factor point, we have so much compassion for these people that there's a lot of fear and holding them accountable, and it ends up being that they tend to walk all over us. They are like teenagers. If they find out that they can do something that is in the gray, then they'll push that boundary a little further and that adds more stress to the owner.
It's hard from a coaching perspective and I know you do this in your role, as well as you're working in developing CEOs, is to help them recognize that that person's taking advantage of you. I hope you understand that they're taking advantage of your niceness and they're coming in late every day because you haven't held them accountable ever. Even though that's in your policy and you have a disciplinary procedure, you haven't done anything about it. You should expect it because you're not doing anything about it. It goes back to our desire, our compassion to want to help, be kind, and be seen as this charitable figure when, unfortunately, the team members will take advantage of that.
That's where I use that term sucker. I don't know if that's a good word necessarily to do it, but we get caught in that and we want these people to win so we typically try. One of the things that helped me a lot too, I tried many ways sometimes to help my staff to strengthen them and I was missing it. I usually get it by making up for what they weren't doing thinking if I led by example and did all this extra work. It bringing them along versus being better at communicating. You start to understand this as a parent where help isn't always doing it for them. Helping is equipping them to be able to do it for themselves.
By making better expectations with our staff and expecting them to do it, but giving them the tools and investing in their ability to do, but at the end of the day, they must do it. I can't be the one that does that for them. I can only give them the opportunity. Help is more defined in there and it falls from your traditional saying, “Give a man a fish or teach a man to fish.” It's that concept. At some point in time, that became real to me as a practice owner. I shifted a lot of how I was doing things. I started to realize that the real way that I'm selling people is by making them more competent, more successful, not by making up for what they weren't doing.
You talked about three things that you recommend that owners look at as they're coming out of the pandemic and some things that you guys are focused on. What's the second thing that you guys are looking at as you are talking to CEOs and partners, as they’re coming out of this?
Before we bump that second one, I think it's critical that you evaluate the strength of your team. I want to comment on that that involves in my opinion. Three key areas which are, the silver lining behind this is a little bit of an opportunity to get what we sometimes will refer to as a reset button. Things haven't been great. Whether I've furloughed some people and I'm bringing them back, or some people didn't make it with me, I'm going to be hiring some new people. Either way, when people come back, I have that ability to look at, “Who am I bringing back? How am I bringing it back? If I find back out into the market, who am I looking for and what do I want on my team?” It's the ability to assess that.
Number two, when they come back, can I make super clean expectations or good expectations about where we're going? Not because I'm going to lay down the laws of manager, but because it's what it takes for the company and ultimately for them to succeed so that their success and the company's success should be hand in hand. Ultimately, if the company is succeeding, they're succeeding, it all comes down to what we originally set out to do, which is we're helping our patients and we're probably helping more patients. If I have a goal and a purpose of helping people, I don't want to help one. I want to help as many as I can.
I want to do this because most of the people we know if they're not in our office, they're probably in an office that's not doing the kind of PT we do. The majority of the time, they're not even in a PTs officer, and attire was starting to massage his office. They're taking a lot of anti-inflammatories, using creams and do all other things. I know, if that person's in my office, we're going to help them more than these other places. I do everything we can to get them in our office. If I lay down those expectations in a good, positive winning manner with my group, we can then win. Everybody knows what's needed to succeed.
I’ve got to hold that in place. I've got to represent that. Even though I can work twice as much as everybody else, that isn't the goal. Sometimes we think it's the goal, but my goal is to get my group to raise up to maybe not exactly where I'm at, but at 80% zone of getting into what we do. No one's ever going to do what you do as an owner and that's fine. I set that up. I do that. Thirdly, how can you strengthen in training and investing in your staff in a way that when they come on, they understand the expectations? We're going to help them gain the skillset for whether that's your PTs, some of it's on the clinical side.
How can I help them or even give them or give them opportunities or certification tracks, different stuff that makes them a better therapist, but also in the productivity side? That's what we need. We need them to be productive. Not in a way that oftentimes people have a tendency to make production and quality of care incapable of existing together, which is completely not true. I'll show you some of the top therapists out there that everybody pays money to go to their classes. Those guys can treat twice as many patients. This idea that being productive means a lower quality of care is not true, but it does take learning how to correctly manage a caseload, learning how to operate in a way that is well- balanced. Those are the three things that bringing on stronger people, better expectations, and better training.
I like what you say in that regard because most clinics have time. If they're a little bit slower and they have a ramp back up to the pre-COVID-19 levels, they have time. When I talked to some of them, I said, “Are you having your meetings?” They'll say, “No, we don't have our meetings because we don't have a lot to talk about in terms of the patient load.” That's wasted opportunity because those are times that you, as an owner, can train the team on, you name it. Any policy and procedure that you need to train them on. Train them on how to increase compliance, train them on how to address a patient when they first come in the clinic, what their first visit should look like. Start doing a training on anything that has to do with your clinic so it's out of your head and out there for the team to understand. It’s a great opportunity to take advantage of the time that we have.
It's exactly what we talked about because we have the old school coaching concept of either get better or you get worse. You never say the same. We always said, “We're either making our company stronger and better and we're expanding or we're contracting?” Obviously, during COVID, you're not going to expand your numbers. Our clinics across the board siding work from 25% to as high as a 50% decrease in our volumes. Almost all of them are back to pre-COVID numbers. During that time, we focus on each partner of ours, “How do we expand during this time?” It came down to exactly what you were saying, we can get stronger here.
We can use this time for training and work on things that we have been able to. We can book better organization in. We can strengthen areas that we were not as tied in policy or systems, getting our staff up, building our directors better. We took that as our opportunity to get better to expand during this time. Expansion doesn't always mean just in money, the gross income of the company and/or the PVs, it can be in other ways like, “We're doing this better, we're tighter here. We're better here.”
Are there some things that you see that your company is doing better post-COVID than you did pre-COVID?
Each one of our companies had their areas to work on. Across the board, every one of them has used this as a moment to definitely set better expectations with the team, figure out who's on board, who they want to play ball with, who is going to contribute to the winning ways for our patients, for the company and themselves have that attitude too. I get excited when everyone's winning. It's like you're getting great results with your patients. Whether you're looking at that through NPS Scores or through the level of compliments you're getting, stories you're getting, the different stuff there that gets you juiced up.
We look at the same ways, is our staff winning or our staff appreciates? Have we provided as much as we could to them? We're looking at our practices succeeding well enough to be on the other side of this and be a leader. That was our goal. We will get on the other side of this and we will come out of this like all of our companies have. We've kept that positive attitude through that and I think our company has done that well.
Step number one, improve the quality routine, strengthen that up, train them up. I love what you're saying about setting expectations because a lot of times that conversation doesn't quite happen and the owner can get frustrated. If a provider on their team isn't living up to their expectation, but if it's not out there for everyone to agree upon, then it's simply an owner's frustration and that's as far as it goes. Are you ready to move on to number two of the recommendations for coming out of this stronger?
The second piece that I would look at if you weren't prepared for this on the frontend is to be better financially prepared. If I had been well financially prepared on the front side of this, especially short of any grant money or PPP money that people might've gotten. All of our companies were prepared to make it through without any of that. We are able to do that. That's not always going to be there. Sometimes the thing that smacks you as a COVID were getting government assistance and there are programs out there to try to help solve businesses. Sometimes, it comes in other forms of where we don't always have that assistance. I think when we look at that, it's like, “What could I do to be better prepared? Can I build a little bit of a reserve fund?”
If my team's performing better, that nicely feeds into my ability to prepare myself. I can set aside a little bit of money that I truly use the financial discipline to not touch except work. When I put it in that account, it's a goner. It is not part of what we look for in distributions and in investing back into the company. That can go a long way there, but I got to know that I can operate with enough of a margin to do that. That should be a focus of owners to make that a necessity where I think up to this point because none of us had any idea that we could get rocked this hard.A weakness is nothing but an opportunity to strengthen. Click To Tweet
Everybody has the idea that a rainy day could come, but not the idea it would be like this. We typically run our companies with a very strong, finished mission and I even felt like we could have been better prepared for this. We could have been, “I had no idea what we were preparing for was not anywhere near what happened,” but we were still able to very well scrambled through, but I would have liked to be stronger prepared looking back on it right at the time. We were at where we were and at the same time, I felt like there was room for improvement there. For a lot of practice owners, we did under-think, what we might have to be prepared for here and we're making it through the week to week, month to month, whatever it might be. I think we need to build in that little preparation piece there.
I was surprised at how many owners I talked to didn't have a line of credit established, even if they hadn't touched it. It was always my understanding that you should at least have access to a line of credit just in case, but that it wasn't a line of credit as your reserves. It was your reserves plus the line of credit that it provided the stability. I was surprised how many owners didn't have that line of credit out there. It reminds me of an interview that I did with Joe Simon in New York, he was the loan partner, that was like, “We need six months of reserves going on here.”
His partners were like, “You've got 2 or 3 months. Why do you need six? Things are going great, the economy is awesome, we are humming.” Lo and behold, we’ve got a hit by COVID. They're like, “Now we understand what you're talking about, Joe.” It's important that we have that money set aside. I don't know about you, but we always tried to keep at least 2 or 3 months of fixed expenses in reserves for each of our clinics. Is there a guideline that you follow usually that you want to share?
We follow the same concept for 2 to 3 months. Six is something you hear, it's a lot. If you have a strong line of credit and you don't have debt, then I think the line of credit gives you that another layer. It takes time to build that up. For the readers and the others that you don't do that overnight, it becomes part of a financial plan that you execute on every month. If you're running a strong business, every month, you can put a little bit away. The other thing is sometimes for some of these practices is the first point should be to take your successes and pay off your debts. That's another way of increasing your financial position because then you should be able to get that line of credit.
Your goal is not to touch it sometimes like a credit card and children are improvident, which means we don't necessarily prepare for the future, “If I want that toy now, I buy it,” “I have no concept of that can stop me from paying my rent later.” The idea of being provident means I can plan for the future. When I have that access and what we know, and then our credit card oriented by on credit world, it's very easy to tap into credit lines when I shouldn't be. You got to have that financial discipline also to know that, “No, that's only for this and I try my best to truly not use it.” I don't use it when “It'd be nice to get new plans,” “We don't have the cash, but we do have our line and I touch it.”
That's not what I would recommend if you are doing that. There are times when you have to utilize your line in the early days of starting a clinic or you're expanding a little bit and there might be sometimes there, “I should attack that debt fast.” That could be a great plan for some practice owners to attack the debt. Get some strengths in your team like we talked about it. A little better performance out of your team and step one and then use those successes to strengthened by either handling debt, then building some reserves and be realistic about not expecting it to happen overnight.
We went into quite a bit of detail with Eric Miller or Econologics on a previous episode and he talked about a number of different accounts that you can set aside money into. The overarching theme was, if you are better prepared financially, it changes the entire complexion of your position in the world and in your business. People who are prepared and in regards to that we're talking about are in a position of power. They're not affected by these vast changes in the economy. They're not blown by every wind and downturn. They're able to stay steady throughout. Those are the companies that are going to stay afloat and thrive going forward.
Not companies that are brand new that as we're already planning on potentially opening an additional office in 2020. Probably six of our companies are on the other side of the pandemic. Their numbers have returned and we're already targeting another office. It's exactly what you're talking about. We have multiple companies that are already planning to open their next location. That's exactly it. When you're in that strong financial position, it allows you to do things that you couldn't do. That doesn't happen again fast, like to be realistic.
Sometimes, in our society and in our world, we get a little bit too much of immediate gratification. We don't realize the timeline it takes to create that. We get frustrated early. We don't stay on top of it. I think if we have a more appropriate timeline, we're more apt to be successful. Eric Miller is a great guy. He has lots of great advice and these all lead into the third piece that we'll talk about, but you're spot in that. The stronger the position, it oftentimes takes advantage, try to strengthen and be able to do things you might not, you wouldn't have definitely been able to do.
I love what you said as you work with your partners, a lot of this stuff has nothing to do with how you treat an L5 facet. You tell your CEOs that, “No longer a PT. When you own a business, you have to essentially take off the PT hat and put on the business owner hat and do what's best for the business. Not what's best for your patients first.”
Those two things don't ever have to necessarily be in conflict, but you must understand that you are running a business. No matter how much you care about your patients, if you are financially in the red, it doesn't matter. You can't care your way out of the red. You have to run your business well enough. The care has a lot of strengths to it, but you still have to understand that another piece. It's the exact thing I went through as a practice owner. In the early days I thought I could be a spectacular PT and then of course I still want to do that, but I realized at some point in time that wasn't going to fix my company.
It's imperative to get some business acumen because of course we're trained PTs. We don't have our MBAs typically. We usually haven't run businesses before. It's imperative to learn some of these business techniques and gained some business acumen to be able to weather in a situation like we're going through.
That's leads perfectly into my third point. We talked about in the second point being strengthened your financial position. Make that a priority in your planning going forward and then the third piece is to improve your business knowledge, your business acumen. You must strengthen this side of your knowledge base. You can't strengthen your clinical skillset and ignore this side. I think that's an area that a lot of practice owners would look at. It ties back and we can talk about the variety of ways in which practice owners can do that. I've evaluated probably 40 or 50 different practices. I've obviously partnered with a lot of practices we've evaluated, some we haven't. I've spent time in a consulting role a little bit before that. One thing, my partner, Ryan Robinson and I talk about typically when we go to a practice that's struggling. They're not doing anything crazy way off in that field. It's lots of little things not being done that add up to low margins, a lot of stress and demand on the company. It isn't because they don't know what to do in a treatment room. It isn't because they aren't able to kill it as a therapist. It's what happens outside of the trigger of it.
We know when we talk about a business, there are many facets to learn about, whether it be your personality, the HR side of it, marketing, finance, team building, a variety of different components. If I understand that, I can learn and start building that skillset, then certainly I'm going to be better prepared to go into the future. This is one of those moments where I might not have been willing to confront that, but I think when I understand what happened, it could make it a little bit real the need to build my knowledge base there too.
I think, unfortunately, PTs don't make that mindset transition when they open up their own clinic and own it going forward in that. They are taking on so many more hats than just the PT hat that they experienced for many years in which they've been treating under someone else's roof. You rarely see them fully take on the ownership hat and an executive hat to the point where they let go of the PTL altogether with the benefit of the business. We talked a little bit about that. It's imperative that they recognize that they have to get some business acumen somewhere and others because they're not going to get better over time without gaining some knowledge.
This is the thing that partly probably why we have that mindset, there was a day when you could be an amazing clinician and not know much about running a business and because reimbursement was a lot higher and the cost to run a business was a lot lower. I could make a lot of mistakes and still be okay. In today's world, as we move forward and depending on what part of the country you're in. Even more so, the cost of businesses up reimbursement is down. Therefore, my margin for error goes way down my window, yet it's much narrower and I have to know what I'm doing. That's the same with any activity. As the game goes up, your weaknesses get exposed and you've got to strengthen. The game went up here not because of growth, but COVID put us to the test. It's like, “Where am I at? How do I get stronger in this area?” There was a day when we could be an amazing clinician and get by, but I think in today's world, that's not there. Especially, when we realize that this could happen, I think it puts a little bit more urgency on the need to be stronger in this area.
It's a great opportunity. I talked about before, if you do have some time and you're not back to your pre-COVID levels and you have a little bit more time and not only is training your team a good idea and take advantage of your meetings to do so, but training yourself to be a better leader, a better owner will pay off huge in multiples that are unpredictable, but it's hard to get owners out of that mindset that investing in their knowledge, their acumen and their improvement as a leader, not just by reading a book and I'm not going to help in gaining some knowledge, but by getting some help and support in gaining that knowledge and essentially paying your tuition to understand what it takes to run a business.
For the readers to think with that, I see these three different ways in which this can be accomplished. One, you got to pay your tuition, invest in it. Typically, you're going to go through some training. That's not a weekend course. You're not going to learn how to run a business in a weekend course. I love PPS at the conference and we go to it every year, but you're not going to learn how to nail your business in a two and a half-day conference with hour-long sessions. You've got to invest in a much higher level of training and there is a multitude of different training, opportunities out there that people can go with.
The hard part about that is it is slow. It's the route that we went along. We took years of investing money, time, and a timeline that takes a long time. No different than if I were to go to school and get my business degree, it's a multiple-year cycle. It's going to cost you six figures plus. Those are just the facts. The irony of it is we think we can't do that, but it does come back and multiples. That's a hard thing to understand, but it is true. One can go down the route of looking at going through formal education. There are different consulting firms that offer great educational opportunities. There are AM tracks and other educational tracks that are available for each person to look at.
The other piece is to do a lot of in line with what you do which is to get a business coach. It's something you started doing, which I think is spectacular. You certainly have the knowledge base to share with people. You know how to make your practice successful, you've done it and that's something people have to be willing to pay for and connect up with the right people and a business coach can go a long way. Accomplishing that is another very viable route to increasing your business success as well.
I both recognized the value of investing in that. Going back to your story that you shared a couple of years ago, it takes some school hard knocks to get you to the point to pay the money to finally invest in some consulting. It didn't get quite that far with us, but I knew in my head, I was saying, “We've got to do something different.” That's finally the time when Will and I opened up our wallets to get some coaching and consulting. That's when we started making changes in our business.
It's not an easy thing to face.
We had to get to a certain point before we were willing to change that mindset.
I had the exact same thing. It was like, I was at a spot where I was about six years in and I burned out right on the whole thing, which is crazy because my original goals and were always there the whole time. I just wasn't how to get them. I was running up against challenges and barriers. I wasn't able to clear and I had that same thing. Something's got to change. I even told my wife, “I’m going to figure this out or I'm going to quit.” She knows me and she’s like, “Don’t ever quit.” I probably wouldn't have. What I was serious about is I'm grinding here and I knew there had to be a better way.
I had one of those moments and I talk about this in our first episode but I said, “Blaine, you're a good PT but you did not know how to run a business.” At that point, I knew something needed to change and I wasn't going to keep doing what I was doing. I was six years into the game and I started my practice straight out of school so I was very young. I knew I had a lot of years in front of me, “I'm not going to keep doing this.” I was ready to start a family and I decided that same point where I knew something needed to change.
You guys are doing something a little bit different for people that want to get some support.
The third thing, and this is exactly what we were trying to talk about. I was going to say it’s a true strategic partnership which is exactly what we do. We partner with practice owners and therapists to specifically bring the business expertise in. Not only do we have the practice models completely dialed in, but the way we train and invest in our partners’ growth is what I think makes our model special. I know there are a lot of partnership models out there, but a lot of them are truly built to invest in partners’ growth. I think it's important, for your readers, if they're going to look at a partnership as a potential option and be very aware of the different types of partnerships. There are very few that do what we do. Most of them are going to be backed by private equity groups, which is a little bit of a different model. I think there are some uniqueness inside of that zone that is probably much better than other groups, but they're not designed to invest in the partner. They're designed to build a large group.
It's a lot different than what we do. We are truly wanted to partner with people to build a great company. Our target that our partners will become very competent and stud CEOs. They will know how to run a practice. The practice ill still provides the quality that's known in the mom and pop shops, not in the big corporate world, but yet has excellent business practice. We have it all dialed in and the systems and how we bring people on, how we help them grow, and invest in them because to become a high-end competent CEO takes years. It's not something you can do in a couple of years. You can't become a top clinician in a matter of two years. It’s years of the process that you've got to have. That's why you can't just take a weekend course, and you can't just read a book.Sometimes you have to take off the PT hat and put on the business owner hat and do what's best for the business. Click To Tweet
You need to connect up with someone who's going to work with you over the long run. Our model was designed to exactly handle that because it's what I experienced. I looked at what I saw practice owners didn't have. That was what we built this company to do, is to try to target that exact thing because most of these guys and girls, practice owners wise and their clinics represent the upper end of the PT market. Compared to the hospitals and the corporate groups, they are the top tier and I want them to succeed. I want them to make it. I want them to be the leaders out there driving private practice in our profession. You can't do that with the clinical skillset. You need the business side to go along with it. We all become part of the system.
I love your partnership model because you and I had been approached by a number of different individuals and companies about buying our practices for a number of years before we finally did sell. In each situation, they wanted a piece of our company and they'd simply told us, “You keep doing what you're doing.” They were going to expect productivity levels out of us in terms of treating patients and leadership roles that we would stay in and whatnot.
None of them offered what you're talking about, and that is to give us a platform to improve our leadership skillset and training on top of what we had already received. It is different about your model compared to most out there that are going to say, “No. We want to be built a partnership here.” That is, you guys have the training set in place to develop your partners as stud CEOs, great leaders in the organization that the men and women, that partner with you are going to get even more training, more learning and more support to become greater and greater leaders and expand as much or as little as they want to.
We were trying to target what we didn't see existed out there. It was exactly why we built it the way we did and we knew because we were met with some of those groups as well. In the early days, I was studying a lot of those models. Honestly, I was unimpressed with what they had to offer. There’s so much more we can do. That was a lot of the impetus to what HRS became in how and why we built the way we built it. What it was designed to do was to close that gap. We talked about the need to change our mindset.
There’s another important mindset that has to be changed because somewhere along the way, we think, being a strong business person, having business success, somehow is in conflict with being great clinicians and providing great care. It’s not because the stronger you are as a company, the better you know how to run your company. If your purposes and your intent is to provide a great PT clinic, the stronger you should be able to do that. If a company is struggling, as much as that owner cares about their patients, there's no way that they can do the same things as if they were doing very well; investing in their staff, giving them great contact. We have tracks in our companies where people can get their manual certification and dry needling certification.
We even have fellowship tracks where we will contribute and pay for people to go get their fellow. There are things that we can do that I could have never done in my earlier days. Not even remotely close to operating what we can offer and how we can continue to look for our opportunities to strengthen, not only right as a business, but clinically across our group. It's one thing to get yourself into the upper 10% to 20% compared to our peers, but you got to get good 10 or 20 therapists in your company into that zone, it is an impressive feat. It's something to be proud of. That's making a difference more than the 60 patient visits a week that I might be seeing as an individual practitioner.
Your level of influence expands so much more as you're able to improve, help others, and create a platform for other people to grow and expand.
On that third point, I think there's a variety of ways that people can make a commitment to getting that business knowledge through their own. Committing to an educational track themselves, investing in a mentor and business coach, or an appropriate strategic partnership. I would add in the strategic partnership side and make sure it's well-vetted out. Understand what that partner brings to the table as far as investing and training in that person like you're saying. We've always made it a focus to work on all aspects of that business and that general ability to be a leader or the great team be a competent executive. If a person can come out of this and make that move, a couple of years down the road, they're going to be pretty happy with the changes that have happened where the company is at that point compared to where it is.
Unfortunately, there's no magic wand. At times, I also even looking for that myself and tell you, at some point in time, you realize that doesn't exist. At the end of the day, those that when they did it right. It's a harsh reality. It's a very valuable reality to apply to yourself when you can say, at the end of the day, and even when my intentions are to do it right, I still have to figure out how to do it. If I do, it will show up in a more successful practice. If I don't, I struggle.
Is there anything else you want to speak to?
We have the goal of seeing practices and private practice succeed. I think there's room for a lot of practice, not our partners and we want to see people making that move into private practice. If they're young, aspiring people with some energy. For existing practice owners, we want to see them strengthening their practices and winning. I hope people can read this and use it as a platform to go forward, hold it back up, or strengthen their practice wherever they're at. One of my biggest concerns with this is to see that people never give back or they don't come back out of it. They don't recover and that to me would be sad. I believe private practice needs to succeed in our profession to maintain what I believe is special about it.
If private practice goes away and it's either the corporate model and/or hospitals, what I admire and find motivating about physical therapy probably is not as much there. In modality and system. I want to encourage people along that line and let them know that there are routes towards success and in a way to be able to deal with what has been a very challenging time. When you're in it, it doesn't always look that way. Sometimes you're like crap. When you said, in your early day, something needed to change and I told you a little bit of quick story about where I was at. I wasn't enthusiastic about it.
I wasn't like, “This is going to be amazing.” When we partnered with people, it's mostly like, “It's going to be amazing. We're going to kill it.” We’re high-fiving. I wouldn't like that when I did it. I was crap. I wasn't even confident the route I took was going to work out at the time I did it. I knew I had to do it. I look back and I thought, “I'm glad I did that.” I didn't know it right at the time. I know there are practice owners out there in that position. I want to encourage them that I guarantee you with that effort, there's probably more business resources, other business coaches, and more help out there than ever before.
That's what's the cool thing about today's world too. There are more avenues. What you're doing, Nathan, with your coaching and the number of people that can lend a hand there and help some people, it is bigger than ever before. I want to get back to finding what is exciting again and getting back to hopefully pulling back to that original burning goal of doing something better than what was going on out there. That's why most practice owners got into it. They didn't want to do it the hospital's way. They didn't want to do it other people's way. They want to do it this way. It's cool when you can get back to that original excitement point and look at things with optimism, as opposed to, “Am I going to make it through? How the heck do I do this?”
If things weren't going the way that you wanted them to and if you weren't living that life as an owner and a leader that you would envision to begin with, it's a great opportunity to reset and create that for yourself.
It's not always easy. As you and I back and forth that, hopefully, that message gets a few people out there and they can start to see things from a more optimistic position again there. You brought up a thing earlier too that we have to be realistic. This isn't may not all be all the way done. Being a past Arizonian, Arizona was one of the ones that shut down their bars, gyms, theaters, and fortunately, not the physical therapy side of it. Either way, we're not all the way out of this. Hopefully, we can all find it together. It's also a very divisive time for other things. I want to see people coming together for positive reasons and for making a difference. Hopefully, practice owners will do that still.
If people want to get in touch with you and talk to you about strategic partnerships, how would they do that?
Our website is HealthRehabSolutions.com. You can reach me at BlaineS@HealthRehabSolutions.com. When you're looking at a good partnership, there are a lot of things that have to be, it's a marriage of sorts. There are a lot of things to work out and understand to make it a good fit and not every fit is the right one, but either way, even in spending time talking with us, it will be educational. It will hopefully lead people down that route of finding what is right for them, or if it is not right, but it's a good opportunity to do that. Getting in touch with you and with other people and understanding what's out there will be helpful and educational. In that process, some things will hopefully come clear. It will look like clarity will become a little bit more vivid on what is the best route for that person.
They can check out our website. We rebranded. We lease that out and refresh our brand. Our original logo wasn't built with some of our original intentions. We threw it together when we were in the early days. I was like it, but we put some time and energy into this to represent us. It was a cool process. There's so much science that goes into branding and some of the stuff that I was always aware of in the early days. I found it a fascinating and enjoyable process. I’m excited we relaunched that, try to get more of our partnerships and some of our partners' successes offer so people understand, and we can differentiate ourselves for a lot of the other partnership models that are out there.Now is a great opportunity to create the life that you envisioned as an owner and a leader. Click To Tweet
Congratulations on the new brand, on the growth and on all your clinics ramping up. I don't think there are many clinics out there that can say they're back to pre-COVID levels. You've built something awesome. It's great to have you and share a little bit of your wisdom with us. I appreciate you coming on.
Thanks for having me. I enjoyed it.
Blaine grew up in Great Falls, Montana, and earned his Master of Physical Therapy from the University of Montana. With an entrepreneurial spirit and desire to make a big impact, he made a bold move launching his own private practice immediately following graduation. He was on a mission to make a difference in people’s lives through physical therapy; however, he quickly encountered the common challenges facing private practice owners.
Realizing an outstanding clinical and provider reputation would not alone create a great practice, he committed to learning how to run a business. Soon after Blaine acquired and merged his existing practice with another large private practice in Kalispell, Montana, he was able to drastically improve the performance and grow the quadruple the company’s performance. This inspired him to help other private practice owners overcome the barriers they face and build successful businesses, and became the impetus, vision, and core of HRS. Blaine has also been active in the American Physical Therapy Association on a statewide and national level developing a passion for private practice advocacy and entrepreneurship.
Outside of work, you’ll find Blaine with his wife, Britney, and their three boys enjoying the mountain lifestyle. Often skiing, navigating the abundance of lakes and rivers in the valley, or hiking the mountains, they take full advantage of Montana’s wide-open spaces. Blaine stays active coaching his three boys in lacrosse and is a dedicated fitness and health enthusiast – particularly enjoying CrossFit.
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More than likely, you have a little extra time during the COVID-19 crisis and its subsequent lockdowns. As owners, you have the opportunity to take advantage of this time to do the things you typically don't have the time to do—creating your purpose and values, structuring the business in your ideal scenario, generating policies and procedures, reading business books, taking steps to implement what you learn, and more. In this episode, Nathan Shields invited his partner, Will Humphreys, to discuss what owners can do to take advantage of this time and come out stronger on the other end. Don't miss out on this insightful conversation!
I thought I'd bring on a multiple-time guest and my favorite partner, besides my wife, Will Humphreys. It’s good to see you.
It's great to be here.
I wanted to bring you on simply to have a conversation because coaching clients that I'm talking to are usually at some stage now because we're dealing with this Coronavirus, COVID-19. They have downtime. They're dealing with an issue that they've never had to come up against before more than likely. I can't speak from experience. You and I have never went through anything like this as owners. I figured the best I could do, and I've tried to share information about COVID-19 and how to manage it, whether that's financially with Eric Miller or with Andy Sabatier about breathing techniques for people who have respiratory issues when they're sick. From a coaching standpoint, I usually come up against things that people don't have time for and I know they're busy. We're all busy. Now because of this virus, we have some extra time. I thought I'd talked to you about what we can do with our time as owners during this pandemic. First off, your thought on how do you look at this and what would you want to say to PT owners?
This is unprecedented. We don't have a way of having a plan to respond to this. However, trials and difficulties we've all gone through. As people are in this place where they've been used to growing their businesses with typical struggles, things that were hard for sure and overwhelming at times, but still they were moving with the current. Due to no fault of anyone's decision-making, they're swimming against the current. Even though they're doing good things and they're making progression to do the right, the best with what they have, it feels like defeat. Stats are going down. As we all know, production is the basis of morale. If we're not producing, meaning impact in patient's lives, it's hard not to feel defeated.Now is the time to create your business the way you ideally want it to be. Click To Tweet
From someone who's aware of the many PT owners out there who are struggling, I want to reiterate that they are doing a great job. You are all doing the best you can and it's making an impact. For those of you who are deciding to close your doors because you don't want to spread it, that is a valid decision. For those of you who are keeping your doors open to fight and to serve people and show that you love them, that's a valid choice as well. No matter what you choose right now, you're doing something from a place of love and concern. I know that the impact is making a difference in not just your life, but the people that you're serving. The thing that I want to say first of all to acknowledge everyone's efforts and let them know that what they're doing is making a positive impact even though I know it doesn't feel like that right now.
It's tough because it is something that you want to reiterate. All of this, whatever stage you're in, it's not your fault. You still have some decisions and power. You don't want to lose that. You want to make sure that you have power to make decisions, that you aren't powerless and that you have the ability to affect so many people's lives whether you're shut down, slowed down, whatever that might be. The important thing to do is to remember your purpose. You've alluded to that. Your purpose is to serve the community in one way or another as a PT clinic. Go back to your values and act according to your values. Stay in line with your purpose. Live according to your values. Make decisions that are quick and efficient according to your values and move forward.
If you are going to close, you're going to have some time on your hands. It's time to evaluate things and make decisions. If you're going to stay open, you're going to be busy as well, trying to navigate schedules and whatnot and what's the next update from the CDC, but still follow your purpose, your values and make quick decisions. Probably the most important thing is to stay viable whether your doors are closed or you stay open. Stay viable because this is temporary.
You talked brilliantly about mindset. One of the first things that you see as important is the mindset. I don't think mindset is like I’m getting crapped on and I'm going to call it something other than that. The way I’ve dealt with some of the stressful situations in my life before learning to get through those through the help of others is that we have to remember the importance of staying present. All of our minds are going to the future right now. We all have people in our lives who are higher risk. We're worried about them. We're worried about the impact of the decisions we're making, whether we close or stay open or whatever.Give yourself permission to not be perfect. Click To Tweet
We're all in that state of worrying and worrying about the what ifs. The what ifs create a bunch of should, “Maybe I shouldn't be doing this. I should be better at that.” When we get should on all over ourselves, we are unable to stay present. Truly, the only thing that's happening right now is tomorrow is nothing. There's nothing wrong with looking at that and having those moments of realization like, “This is a scary thing.” Instead of trying to pretend like it's not there or call it something different, put an arm around it and say, “Everyone's stressed out right now. We're going to get through this together,” and love yourself. Give yourself permission to not be perfect. I hope you hear that it's okay that you don't know exactly what to do and you are in this position for a reason.
What you're doing right now is something that is going to impact so many people. It's not by accident that you are a leader. You're needed more now than ever. The only thing we can do when we finally realize where we are in the present is create. I'm scared of all these different things and I should be doing all these things. That sucks. I'm going to sit with that until it goes away. When that feeling passes, let's get to work. There's opportunity in this. I'm not trying to overly rosy on this, but there's a lot of successful actions. There could be gifts in this, but we have to be present to what we're feeling and realize our power to create imperfectly nonetheless.
We don't have all the answers. I'm not coming at it from a perspective like, “I've been through this before. Here's what you need to do.” Anyone who promotes that, you've got to take with a big grain of salt. What we can do is go back to some of the basics and recognize that an opportunity comes out of situations like this. Eric Miller put it nicely. I'm going to try to summarize it, “Essentially nothing major ever happened out of times when it was super rosy and everything was great. It's usually during problems like this that real leaders step up and difference is made.” It's through the challenges that we grow. As we're talking about the five things that owners could or should do while they were closed down or slowed down significantly, they're going to go through a lot of stuff. They're going to send in all the applications for the loans. They're not going to find out for a couple of weeks if they get that money or not. You're going to have time.
It's time to spend with family, to reconnect, revisit your hobbies. There are some things that as a leader, you have more responsibility. That is to keep your business viable. I want to talk about those five things that owners can do while they are slowed down and/or closed down.
The first thing that you brought up is to deal with the present. Recognize where you're at. Let's get as much certainty around us as possible. What is my new breakeven point? What do I need to do to stay afloat? What's in my bank account? What's in my accounts receivable and what do I have available to me in case of emergency in terms of line of credit, SBA loans, grants, relief act, all that stuff? Gather some certainty around you so that you know where you presently exist. Get some certainty because the last thing you need to do is make decisions out of uncertainty.
A lot of that has to do with dealing with the present, where you are now and stay connected. Network as much as you can possibly, especially with your peers in the profession, APTA, PPS, peer program, mastermind, coaches, consultants. Stay in touch. Do the webinars. There might be a lot of white noise right now but stay connected. The last thing you need to do is isolate in a time like this and think that I'm in this alone because you're not. There's a lot of information out there. There are plenty of resources. That's a little bit of my take on being present. When you say, “We'll be present,” give us a little bit more detail about what you're thinking when you say that.
You started into that beautifully about creating certainty and understanding what your existing reality is because it shifted. If we resist it, we're not going to be able to see opportunities there. What I meant by that is that once emotionally we give ourselves space to let those normal human feelings go through us and we don't attach ourselves to them and we don't resist them, they happen. Once we get to that sense that we can create the leaders, the first thing we need to do is lead ourselves. Being present looks like looking at myself as an individual and take an honest assessment of what I could be doing to lead me as a human being first meaning mind, body, spirit. We all go through the whole diet and exercise thing. This isn't that.
If you hear it wrong, it's going to sound like that. What I'm talking about is are you exercising to hack into your body's own system to access the most optimal way of being physically? If you're spiritual, are you reading the scriptures and praying if that's what you believe in. Are you reading? Are you journaling? All of these things show independent leadership and help sharpen the ax. That story of Abraham Lincoln, you've had two hours to cut down five trees. He'd spend the first hour sharpening the axe or something along those lines because he understands that's where you focus. It doesn't feel like that's where you should be.
It feels like you should be hammering the trees.
As quickly as you can, “Our accounts receivables are going down,” hammer, hammer, hammer. Slow down. Planes are going through turbulence. They don't speed up. They slow down. They take a breath. They honor the environment and that minimizes the impact. They still get where they're going and with a lot less fear. Leadership looks like first leadership of self, second leadership of family. How's your family doing? You can't go find hacks within your company if you have someone who's at risk and isn't getting what they need. Is everyone emotionally okay? That's what leadership looks like. I've taken care of myself, now I'm looking at my family. That's why we do what we do ultimately.
We can look at our business. It's not like I've done myself, checked off my families and now I'm working on my business. We do it on a daily basis. It's routine. Realizing that routine isn't perfect either. We do what we can a little bit more intentionally every day when we're fighting in the ring against an enemy. It's one step at a time, one punch at a time, one round at a time. That's how we stay present. We let those fears come about the future. There's a lot we can talk about in terms of how we can look at our business from the present in terms of assessing the existing accounts receivable.
There are tons of opportunity for people who've always been comfortable but not confident that they're collecting every dollar they should to be able to dive in there at this moment in particular and capture everything that they can. They have time to focus on it as they should. When you talk about what I meant about being present, it's got to be about being a leader first to yourself, then to the family, then to your company, then the industry. Once the car is in motion, that picture will appear. Illusion will come if we stay consistent with manageable efforts. That's it.Finding purpose is a group effort. Click To Tweet
That leads to the second point. You alluded to it. I don't know if I even gave it the right title, but consider managing your time better. What I mean by that is make time for the important things like yourself, whether it's journaling, scriptures, prayer, meditation. Use that to your advantage. Focus on yourself, on your family. I always like to refer back to Gary Keller's book, The ONE Thing. Consider what's the one thing that you can do right now in the very present such that by doing it makes everything else easier or unnecessary. Consider the options that you have before you on a day-to-day basis. Even on an hour-to-hour basis or half day-to-half day basis. What's the one thing that I can do within this next hour such that by doing it, everything else becomes easier and unnecessary.
That could be an action. It could be a decision that you make. When I say action, it could be a simple email. It could be a phone call. It could be filling out the loan application. It could be talking to your CPA about that new breakeven point or meeting with him to see how you compare down expenses. It could be giving your wife a hug because that's her love language. Spending a little bit more time with your family or whatnot. Focusing your time in the present that you have on the most important things. I like how it starts with you, the individual and it spreads out to how you affect your family and those immediately around you, then your business and the community. None of those others are going to be affected positively unless you are in a good place. I like The One Thing. It's a good read.
That goes to my third thing, which is get a good mindset going. I always like to refer to the first four chapters of Think and Grow Rich by Napoleon Hill. There's a reason Think and Grow Rich has been around for over a century. It’s one of the more popular self-help books around. The first four chapters help you with mindset. I like Traction by Gino Wickman. It helps with business structure. I like Verne Harnish's Mastering the Rockefeller Habits and Scaling Up. Will and I used all of these in growing our business to where it was. Looking at some of those things to lay the foundation, reread them if you have before or start implementing what they're teaching. It could be good things to do during this period of time to establish the foundation, get the right mindset. Anything that you would recommend in that vein?Once we're in the motion of serving and helping others, we're fulfilling our purpose. Click To Tweet
Nathan quickly rentals off these books and these groups that we've been through. He's summarizing years, countless hours of in the trenches, building the business that we felt like we were able to master. The other book that I think of is Man's Search for Meaning by Frankl. It’s an incredible book that helps create more of a mindset of why. The why right now is hard to identify through all this chaos. From a microscopic to a global perspective like, “Why are we going through this?” Ultimately, having the right purpose and clarity within. Spending time talking to someone to help you get to that clarity is how you get clear. Finding purpose is a group effort. I know you as a coach would be more than happy to meet with anyone to talk about their purpose. I as well am happy to offer my time to talk to people because clearly understanding why you personally exist on this earth helps motivate. There's a movie I saw that I would like to recommend in terms of mindset. I watched Unbroken.
It's the true story of this man who ran in the Olympics right before World War II. He was in Germany and saw Hitler. His story is unbelievable. This is the type of story that if you watch this, it will inspire you. It's a true story of this wonderful human being who ended up getting shot down in World War II. He got shot. He had to get people dying next to him. I won’t tell the story. When I watched that story, it made me emotional. It’s inspiring to me because that particular day I was in a funk and I was trying to not be in a funk. This let me realize it's okay to be in a funk and I'm going to take it one step at a time. I started producing.
We all know this logically, but we have to emotionally experience it over and over again. It's not until we're in service of others and grateful for what we have that we can let the anxiety and depression go. Once we're in motion of serving and helping others, we're fulfilling our purpose. No matter how our individual purposes differ, we all share one common purpose of helping others. By virtue of being in that service of whoever, I love your analogy of hugging your wife, from a place of like, “I'm doing this because I know she will appreciate it,” or spending a time with your son or having that hard conversation with that employee that you're furloughing because you can't afford to keep them on and you let them know that you care.
What if it's a matter of calling patients? If I can highlight Vicki Buchanan, in Oklahoma, Vicki has this incredible company where her attitude is so inspiring. She has this thing going where she's got her team calling patients to let them know that they're concerned about them and ask if they can serve them. I know she's not alone in that effort. When you hear Vicki talk, there's no fear. This is a woman dedicated to making an impact. It’s like the gift of our situation is that there is no gray anymore. We're either being affected by what's happening or we're tackling it head on. I cannot fall asleep in the middle, go to routine and live life as if it has no greater meaning. The meaning is immediately present to us.
I totally believe that when Vicki makes those calls that if someone said, “I'm out of toilet paper,” that she's going to get off the phone and find some toilet paper for that person and get to their house.
I have to highlight you. She was telling me that one of the things that she's been doing is you give some advice in your previous podcasts about doing something for doctors, showing them that you care. She had excess hand sanitizer and she would drop them off at these doctors who are seeing these sick patients with COVID-19. We all know what that means. How funny is it that before, she had dropped off hand sanitizer how that would have been experienced? Now it's like she dropped off a bar of gold that was made out of like, “My love and appreciation for your office.” Her listening to your podcast inspired her to do a little bit more. Her effort with her patients inspired me to do a little bit more. Inspiration, motivation, we need each other as a family.
I like what you said about how these things change us because if we go through an experience like this and we don't come out the other side as different leaders, fathers, husbands, especially we're talking about business leaders. If we don't come out the other side as a different company, especially as we have this opportunity to push the reset button. The pause is more than likely what where we're at right now. If you look at it instead of pause, push reset instead and create the business that you want to fulfill your purpose. All the complaints that you had about the business before this happened, you had an opportunity to correct them all. Write down your biggest headaches and figure out how you can correct.
Step number four is prepare for your restart because you're going to start up again. Who do you want to bring back? Pick out the people that are truly aligned with you that agree with your purpose and values and act accordingly. Hire judiciously if that's the right word or bring them back on judiciously. Take an opportunity. If things were scattered and you were the solution man, you've got a lot of time to write down policy and procedures. This is how we do things at XYZ physical therapy from now on. Maximize production as you go forward. If you weren't tracking statistics beforehand, figure out how to track them now and move forward. Consider things have flipped. Eric Miller pointed it out in our interview. It used to be an employee's playground. Now, it's an employer's playground in terms of hiring and recruiting. When people couldn't find a PT or a good front desk person to work for them a month ago, now there are a lot of people that are available. If you can stay afloat and viable and are willing to take advantage of this opportunity, you can find some great people that are out there. Taking this time to not pause but also push the reset and make it the business that you want.Mindset supersedes actions. Click To Tweet
That's incredibly inspirational for leaders. We've talked a lot about mindset for the first 2 to 3 steps. We're getting into the weeds of like what you can do with the time that's traction. You have to remember mindset supersedes actions. All that first stuff. There are people who were so logical that I've coached in a world that they don't understand that, but it takes an experience of it to understand that the world is so humble. They're open. I started a new medical billing insurance company and I put an ad out to see within 48 hours for a medical biller, I had 528 resumes. I estimated that it would take four weeks for me to have 40 resumes. I had 528 resumes. Many of them are rockstars from other companies. What we're not saying is that like, “The tide has finally shifted. It's about time.” What we're saying is to do two things. I had a couple of actionable things that you can do. The first thing is as an owner, once you get done mitigating the majority of the real heavy shifting. People are in meetings with employees and they're making major structural changes. There will be a point where there's time.
When they take care of themselves and their family and they're feeling like a creator, the first thing to do is to take a personal work assessment to write down every duty that you do. That was a weird way of saying it that I would agree that you function in. You want to highlight the ones that align for you. You want to look at everything that doesn't. You in this space have an opportunity to see the truth that the more time you're spending doing those things, the less your company will grow when it returns to normal. It can only be as great as we tolerate. What are you tolerating right now? Not at work but in life. When it comes to people, once you do an assessment, you realize when we get back, I'm committed to working myself out through outsourcing, training, or hiring of all these things. I'm going to focus on these other areas. Second thing is you talked about simplifying things. There's no greater stress for our PT owner than managing a team when it's not cohesive.
One of the things that we do is doing an A, B, C, D assessment of all of your personnel. We don't talk about staff. Staff is an infection. You have team members. Your team members fall into one of four categories. They're either A, B, C or D players. A-players align with your values and are highly productive. We know who these people are. They're rainmakers. We love to be around them. We're scared if they leave. B-players are highly valued, well-aligned people who aren't producing meaning they aren't able to see as much patient care without being stressed out or they're unable to get through their day without getting a lot of help. We want to train those people to become A-players. C-players are the dangerous ones. They're the cancer. They are highly productive but low value.
They keep these people around because they can produce. They have a lot of patient visits. Their patients love them, but they're always undermining things subtly. We all know who they are. The D players are the ones that we are very obvious that we have to do something about immediately. With anyone, we coach people either up to A or out of the company. We coach them. We serve them. We help them grow. This is the perfect time to ask yourself one key question after you do this, A, B, C, D assessment with all of your employees, including yourself, because this was a shocker.
There have been roles I've had where I've had to fire myself. Would I emphatically re-hire each of these people? Not that would I hire them, “Yeah, I'd hire them. They've got some issue.” No. Would you emphatically we hire them? This is going to esteem for some people. For those of you in partnerships, would you emphatically re-partner with your partner? Would you empathically hire yourself for the job that you're doing? If any of those answers are no and you don't know what to do about it, that's when you have a coaching business. There are people out there in the world like Nathan who are able to support and help you clear on that. This is the best time to do it when you have options, which we typically aren't used to having and what an opportunity to seed the very soil that will precipitate all future growth.Profitability unlocks possibility. Click To Tweet
This is an opportunity to get ahead. It's a pause in the business. Most of the people that we're talking to have shut down or closed down or slowed down significantly. It's an opportunity to see that 2021 could be dramatically different from 2019. If you make the effort to make it so in a better way, a way that gives you more freedom, that's more aligned with your purpose, that gives you time to be the person and the leader that you want to be. Generally, in turn, that turns out to be profits as well. It's not all about the money, but goodness gracious, profits help out a lot.
With my new company, that's the biggest thing that I'm focusing on is that profitability unlocks possibility. When we are profitable, and you can be profitable even in times like this, profitable can mean a lot of things, but the bottom line is do you have cash? If we're seeing our cash dwindle, it's scary. There's a reason because that's freedom. Ronald Reagan was quoted saying that freedom is directly tied to profitability and property. He was basically explaining how money isn't why we do what we do, but it creates the space to be able to go create. Our industry has a real issue with money. People are trying to say all the time, “I'm not in it for the money.” My question is what do you want the money for?
If you want that money to do good, you better be in it for the money because money is a tool that gets you to make a bigger impact. Profitability unlocks possibility. It wasn't until we got profitable that we had space to see what impact we wanted to make in the industry. Look at you now. You've had a podcast now for a few years. In a space where there are very few people standing up because they don't have the possibility or time to think about doing what you've created, it took profits to get you there. We don't do that on the backs of our patients. We do that making a change in their lives. Profitability is everything.
I hate it than it is tied to money, but money gives you so much. It gives you freedom. It gives you an ability to develop culture. It gives you the ability to expand and help someone else and pay for training to gain knowledge. That's why we pay money for tuition so we can have an exchange of knowledge, wisdom and all those things. If you get through this situation and take advantage of it, you can be more profitable like 8% to 10% net profit margins is not okay anymore. Entrepreneurs don't go into business to be at 8% to 10% profit margins and work 60 to 80 hours a week, full-time treating patients and running your business on the weekends, not being with your family, not having any hobbies. That's not life.
This has given us an opportunity to reset our priorities, our values and recognize that if I'm going to start up again, I'm going to be maximally productive. I'm going to be profitable. I'm going to be with people that I love and I'm aligned with. I'm going to make a difference based on the purpose that I've established. If you haven't established a personal and business purpose and values aligned with it, then that's the first place you start. You work down the line like we've talked about. It starts with mindset, developing the structure. How do we want to be as a company that eventually ties into your routine? That routine develops into a culture. There are so many things that snowball off of purpose and values first. Eventually, that leads into profits and freedom and that's what we're looking for.
I love that flow how you describe it because that is the process of which freedom is created. Freedom is the goal. It's a lack of being weighed down. I love it when people build their businesses. They go back into treating because they choose to. Those people who have businesses at some point think they want it because they want to focus on treating the way that they want. Ultimately to be able to build it from that place, it takes profits. I'm going to say something a little controversial on purpose because I want to continue this mindset shift while we're open to it. I want physical therapists to start thinking that they should make as much money as they can ethically. I want people to start thinking like that.
There are those few and far between who are completely in it for money. It shows up like not being ethical, but they're not as common as we all perceive. Most people I experienced the fast majority or profits or the national average is 8%. The report that came out shows that average physical therapy, private practice makes 8% net margin. That is unbelievably low. There are 18,000 private practices in our country. Our industry is a $38 billion industry. $16 billion of that are the private practice owners who have between 1 and 5 locations. The average profit margin is 8%. There are so much you can do to improve that. We're so focused on more new patients, hire and tolerate them. If they fog a mirror, maybe we'll improve that over time. Top line growth is all I can do.
There are many other things that can be done. When you get to that profitability stage, that's when you get to create podcasts. In my family's case, we moved to Europe. I took my four boys and we moved to Europe before all this craziness. We spent time talking to healthcare professionals in seventeen countries. My sons got to experience life. It wasn't a vacation. It was heavy at times. We were homeschooling our kids. It was 800-square feet for all six of us. When we came home, the miracle of that experience changed the lives of those four boys forever. I've got four individuals who want to make an impact in the world now in a way that they never could have understood without that. For me, I was able to get some clarity as to what my next steps are in life. All of that is reinvesting in ourselves and profitability is where that freedom is created.Finding purpose is a group effort. Click To Tweet
There's so much that you've shared and a lot of it simply goes back to laying the foundation. It's getting your mindset, deal with the present as you need to, and start establishing the foundation for the future purpose and values, organize your company and structure. Get into a habit of managing your time and preparing for your restart up now even down to the content of your marketing. When the doors open again, getting agreements together with people that you're going to hire in the future once you start up, all that stuff. Start looking ahead and doing things for your eventual open up, so that you're not behind the curve a few months from now when the doors open and you're like, “I need to start putting things together.”
Put it together now so that you can start off running. That's what I'm hoping people get from this. Look at it as an opportunity to not pause but also reset. Look at the opportunities that you have going forward to create what you want to create. Make as much money as you want to make and do it the way that you want to do it. You've got to be certain about yourself first. Hopefully, people get some value out of this. Will, thanks for your time. I appreciate it. I always love you.
Thank you for the opportunity.
If people want to get in touch with you, how do they do that?
They can email me at Will@WHumphreys.com. In terms of this way of serving people, I'd be happy to talk to you about your personal purpose. I'd be more than happy to do an assessment of your team with you. I know these are all things that you do as well, Nathan. I do have something I've created. When I was in Europe for those six months, I wrote a book called The Family Startup. It was applying these concepts that we've talked about into our home. It’s talking about leadership of self and family. I created this document called The Smarter Start. It is a daily tracking mechanism of your routines. I've got it divided into mind, body, spirit and heart. It’s the whole thing in a routine.
It's about an hour to an hour-and-a-half in a day and it covers everything from meditation and texting your wife that you love her. These kinds of things are done. The compilation is unique. It’s mine, but none of it is something I've created on a single basis. It's something that I’ve been using for the last year. I honed it in Europe. I'd be happy to share that document with whoever would like that as a guide of like, “Where should I start in terms of taking leadership of myself?”
You started doing some medical billing. How much do you want to share about that?
When I came back, I am still associated with Empower Physical Therapy. They're an incredible group. I've been able to create some space to start this company that focuses on medical billing and insurance. It's something that is probably the least attractive part of our job. The way I tell people, it's like there's nothing sexy about medical billing if you're doing that. For me, our journey in particular, there were key people, coaches who helped me understand that no matter how much I know about patient care, it would never make up for what I don't understand about my billing and collecting practices. My ultimate purpose is to create freedom for physical therapists. There are different areas that you have to address, but finance is one of the quickest things you can do. It's the scariest thing for us. We usually outsource it to a company that only goes for low-hanging fruit or we in-house it and we do better.
We have these monstrous headaches that sometimes can bankrupt us. I often work with clients who are comfortable but not confident that they're collecting every dollar they should and they think that outsourcing is a bad solution. Those are the clients I'm attracting. I'm being direct. We're growing pretty well right now. We're able to help entrepreneurs find in their accounts receivable money that's sitting there. When you have a good billing and collecting solution, whether it's in house or outsourced and it's not great, that difference depending on your size is at least tens of thousands of dollars. We've done ten different profitability breakthrough audits with clients. We have found nothing less than tens thousands of dollars that they can go get right now. If you're not sure, call me at free of cost. We can even do an assessment and see what we can show you is obtainable.
Especially if you're in that 8% to 10% net profit margin. Please call Will.
Even if you don’t end up hiring me, let's get you some solutions. You’ve got to get up there. I will say the other part of that is leadership. I'm not trying to duplicate this. I'm being direct that it was the finance piece but there was the leadership training piece. That's where Nathan comes in. We are great partners because we complement each other in the ways that we do. We've crossed over a little bit in what we focus on. Nathan was always this financial guru in our business. He's an incredible person to meet with for leadership training. Having been with him, he coached me for almost an hour before this. I have to say that I'm like uplifted and inspired to go to work. I'm not saying it because I'm on your show. Go to Nathan if you're not sure where to go.
I should share mine, Nathan@PTOClub.com. The work that you're going to do is great because 8% to 10% net profit margins is unacceptable. We need to be more focused on our cashflow and our money so that we can make greater influence and differences not only in our lives, but those that we employ in our community and the lives of our employees and team. It dramatically affects people's lives simply by the financial support that you provide. I’m excited to see your growth going forward.
Thank you, Nathan. Thanks for the opportunity to be on this show. This was awesome to be with you.
Will is the CLO and co founder of “Freedom From Billing” and has been a PT for 20 years. He owned a multi locational outpatient practice for 12 years before starting Freedom From Billing with Katie Archibald. He is a father of 4 boys, married for 20 years and a part time comedian. He is passionate about physical therapy, entrepreneurship, and the freedom that is created through profitability.
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