Episode 21

Does Split Ownership Lead to Happier Patients?

Nick Weber, Chief Operating Officer at Team Rehab, joins us to talk about how their business model gives Clinic Directors flexibility within their clinics to create their own environment and culture of patient care. Some of what we talk about: The financial commitment for clinician owners in a split ownership model The recruiting and onboarding of new owner-operators Operational resources for clinic directors
Published on 01/25/2024
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Episode Transcript

Allison Jones

Good morning, good afternoon, good evening, and welcome to the Therapy Matters Podcast. Your one stop resource for expert insights and advice on everything therapy and rehab. I’m your host, Allison Jones, and today I am joined by Nick Weber, Chief Operating Officer at Team Rehabilitation. Nick, thank you for joining me today.

 

Nick Weber

Thank you for having me, Allison. Good morning and good afternoon to you as well.

 

Allison Jones

Excellent. Before we get started and before we jump in, take a few minutes to give our audience a little bit of background on who you are, what your journey has looked like, and what it means to lead operations at Team Rehabilitation.

 

Nick Weber

Thank you for having me. I’ve been a physical therapist for over 25 years now. I had the pleasure of working in all kinds of environments, from local rural hospitals to large flagship sports medicine and orthopedic practices, with physicians in private practice. I then found my way to Team Rehabilitation, where I opened Clinic 9 back in 2009. Since then, I’ve been fortunate enough to work with some amazing therapists, both in my clinic and as a mentor to other clinics as they opened. I was able to be a part of the team that helped open our third state in Indiana and our fifth state in Georgia. 

I ran the state of Indiana as a vice president of operations, which was super exciting and such a great time because we got to bring the Team Rehabilitation model to another state and to many other people that enjoyed ownership and autonomy. I split a role where I was the vice president of operations for Georgia while I was the COO in a transition period. That was exciting because it was another market, and here we are, almost 15 years later, when I joined Team Rehabilitation. We were a long way from my clinic 9 to 130 and counting clinics and five states later, so it’s been everything I’ve wanted it to be because I got into this to help people. The way I look at it, I am still helping people.

 

Allison Jones

Team Rehabilitation is a network of therapist-owned outpatient physical therapy clinics. As you mentioned, you have over 130 locations in Michigan, Illinois, Indiana, Wisconsin and Georgia. You have an eye for continued growth. Your patients’ satisfaction has been at 99% since 2001, and you are continuously rated as one of the top places to work year after year. It’s truly an impressive operation. Let’s dig into it. Let’s figure out what makes Team Rehabilitation work the way it does. Your network is therapist owned, so what does it mean to be a clinic director? What is the commitment like?

 Nick Weber

First of all, you’ve done a lot of good homework. It’s always nice to hear those things about how hard our therapists work to make patients happy. That’s our cornerstone, as Team Rehabilitation’s goal is to make patients happy. We do it by having and employing great people who clearly love being a part of that team and going after that mission. It is impressive to be a continued top workplace, not just for our corporate headquarters where I am here in Michigan, but as we’ve grown big enough in every state, we’re winning awards for top workplaces in Illinois and Georgia. We’re able to reproduce that, which is something special. 

The strength of Team Rehabilitation has been and will always be in the clinic ownership of that clinic director. That clinic director partners with Team Rehabilitation, and they split ownership. Team Rehabilitation takes all the risks, does all the stuff that nobody graduating PT school wants to do or anybody wants to do, HR marketing benefits, and the like. Then it just leaves the clinic director to do what they do best, taking care of their people, taking care of their patients, and making sure they have everything they need to be successful. That commitment level is huge. It’s not as huge as an investment. The rest of it is your sweat. What you put into it is returned directly to you for what you can get out of it. 

When you think about commitment level, it’s hard to kind of put a finger on it. It’s everything from shoveling and salting the office to shifting patients around to make sure they get what they need. You may have to work an extra shift to cover for someone during a growth spurt. It’s that love of patient care on that clinic director level that they can create their own environment of excitement, their own culture of quality, and patient satisfaction on their own level. That’s what drives the Team Rehab model, and that’s what is driven by the entrepreneurial owner operator that we have at every one of our clinics. 

 

Allison Jones

A lot of what you’re talking about is personal characteristics of the types of people that you’re bringing in, so is there a certain type of criteria that you use when you’re onboarding new clinic directors or onboarding new team members in general? Are there certain things that you’re looking for in that personality when you’re hiring people?

 

Nick Weber

Our turnover speaks volumes about how low our turnover is for our owners and for our therapists. A big part of that is how we recruit. We look for somebody who loves taking care of people, scores very high on integrity and conscientiousness, has good mental ability, and demonstrates skill for the job they’re doing. I think that gives us the best chance of having a great team put together, and so far, the proof has been in the pudding with the top workplace recognition. 

 

Allison Jones

Absolutely. Now, you mentioned turnover. Is that something that you’re willing to share? What is your current turnover rate?

 

Nick Weber

I will. I don’t like to brag, but this one’s going to come out good. If we look at some of the great industry literature out there, whether it’s from the people at the APTA, WebPT, ISIM, or any of those publications, they talk about turnover rate. Our turnover rate, as far as our therapist goes, has been in the single digits forever. For the first ten years I was here, I could count on one hand how many therapists we lost in our clinics. It’s definitely a little bit more now, but the industry is such that it lends to that. As the industry has seen double-digit increases and the loss of employees, Team Rehab is not going unscathed. We’re still at half the industry standard for turnover, so we don’t lose a lot of people. A lot of that is our ownership, both at the level of the clinic director and the therapists above. I wouldn’t say that we haven’t lost clinic directors who’ve gone on to do great things, but its loss ratio is 12% or so based on whoever you read, and Team has been 5% or less even over the last three years. We’re doing a good job of keeping our great people, which is huge for us.

 

Allison Jones

That’s tremendous. That speaks volumes about the program that you guys have developed for your patients and for your people. Let’s switch gears a little bit. You had mentioned a little earlier about the corporate side of things that Team has put together and does all the stuff that the clinic director doesn’t want to do or has to do from HR, payroll, and marketing. The corporate side of things sort of handles that. Tell me a little bit more about the support that you provide for individual clinic operations and how that helps your clinics stay focused on patient care and continue to grow and thrive.

 

Nick Weber

Even though it’s a one-third to two-thirds split between the owners of the clinic owning a third and the team owning two-thirds, it’s very much the clinic director in the clinic who is the head of the dog. The admin is there to support that. If you think about a normal traditional outpatient therapy clinic, that’s one entrepreneurial spirit who’s got a vision and a referral source, and what we’ve done is taken that one step further by saying, ‘We have people who are experts in HR, RCM, IT, or marketing; they’ll do that part of your job for you so you can spend all your bandwidth growing your business day to day.’ Now let’s say that an individual entrepreneur doesn’t have a sounding board. Oftentimes, they’re on their own or blazing their own trail, which is awesome. We allow and encourage that. We have tons of operational resources available. 

Every clinic director gets paired with a successful clinic director, a mentor who they can meet with to talk about hiring, purchasing, business development, whatever is on their brain, coaching, mentoring, growing, hiring, and recruiting. They have that person there for them at their fingertips at all times to help them. The individual practice owner has to be the CFO, CEO, COO, or all of those. We have those resources available to them to handle some of that work that they don’t want to do or just aren’t as skilled at. When I came out of school, I didn’t know half of what I know now, and I still have another half to learn, at least. However, it helps to take pressure off them for billing questions because there’s a ton of those for authorization and verification questions. There’s a ton of them, and they just really leave their bandwidth and brains open to taking care of the patient, which is really the only thing that matters. If we can eliminate all those other headaches for them, that just makes their lives easier and very successful as a result. 

 

Allison Jones

Yes, I think you made the comment during our prep call: Let the clinicians just be clinicians.

 

Nick Weber

Yes, absolutely. As a therapist and as an owner, I’m just excited for patient care all the time. My goal and the decisions that we make with my team and in the clinics have got to be about how we continue to allow people to be excited and stay focused on taking care of their patients so we can keep an eye on everything else. If we can do that, then we’re successful because that allows them to take care of patients. Taking care of patients is all that matters.

 

Allison Jones

You mentioned a few times this concept of individuality. You mentioned sort of the clinic director, which is the head of the dog. They’re making the decisions. Why are individuality and ownership so important? How does it tie into the success of your clinics?

 

Nick Weber

When I came on, there were nine different clinic directors, all of them with a different community to serve, a different population of people to take care of, a different pool of referral sources, and a different skill set and upbringing. What’s amazing about being a physical therapist is that you can blend your art and science into any recipe you want and still be really successful. What’s important for us at Team is to allow that individuality to be expressed. What we do is we want to enhance it, support it, and nurture it so it grows. We have successful clinics with a much older patient population than another successful clinic. 

We have clinics in all corners, all kinds of parts of towns, and communities that are taking care of all kinds of demographics. We want to make sure that we express the individuality of the clinic. That uniqueness of that community’s needs, that diversity that the community needs to be served with, is there. If we can be an integral part of the community and allow for that individuality, we’re going to be really unstoppable in our success because we’ll be a pillar of that community strength and have that great clinic director’s energy channeled towards taking care of those patients. It’s super exciting to see, and it’s great to walk into clinics and have patients pull you aside or ask who you are. Immediately brag about somebody that they’ve set their family to what they’ve been coming to on and off for years. That’s why we want to do that. There’s so much reward in taking care of people that you can do it in your own community, and you have to be a little unique to do that. By all means, let’s do that, and we can be very successful in doing so. We don’t have to have that same rubber stamp on every clinic to be successful, that’s for sure.

 

Allison Jones

That concept of rewarding too. When we talked during our prep call, you also mentioned profits. When Team Rehabilitation overall is profitable, you talked about rewarding team members for their hard work. It should be that way, that you should be rewarding your team members. Tell me a little bit about how that profitability goes back to your clinics. You had mentioned that you would share that back. I assume some of that goes back through the equity, but how does that work?

 

Nick Weber

I’m actually sitting in the room where we came up with this early on, as we started making money or figured out how to make money because we did a great job early on, but that teaches you a lot. We realized that in simple accounting, either the money goes to the founders of the company and the owners for our services, or we share it with our employees. That was a really easy answer. That means it’s a bit more work, but why not? If the people generating the money are in the clinics or they’re collecting it from insurance, why shouldn’t they get it? What we’ve done is we’ve really had a philosophy of taking care of our employees, such as basic human needs with outstanding benefits, which we are literally based on as far as benchmarking goes. 

On the compensation side, we want it to be incentivized so that if you put in those extra hours or you shift your schedule, you get that extra visit more, like today with clinics closed, you shift your schedule and come in another day and stay a couple of extra hours to help Mrs. Smith get her needs better so she can go grocery shopping herself. All of that matters. What we’ve done is that at every level of the company, there’s some sort of incentive to profitability at the highest level. Obviously, distributions of profit are important, but what we want all our clinic directors to have access to is, after tax distribution, an award for all their hard work. Within that clinic, there are other owners of the clinic. If you’re a therapist or an assistant CD, or 2IC, as we call them, you can have 1% or 2% ownership, and then you get profit distributions. The next level down, we have a couple of special bonuses based on company and clinic profitability that get distributed out to everybody in either that clinic who hits the profit target or the company who hits that profit target. 

On a clinic level, the therapists share in the profits every month as long as their year to date has been profitable. They don’t have to be alive today; they just have to be here. That can be anywhere from a couple of bucks to a couple of paychecks a year. Again, make the decisions about being excited, take care of patients, and get the rewards, too. We distribute a lot of our profits to our employees before they hit the bottom line, and even once they hit the bottom line, we’re also distributing those profits in the form of profit shares. Profit distributions to shareholders of Team Rehab Services and the clinic shareholders.

 

Allison Jones

You also mentioned that there is a mentor program. This is something that is beyond the general services that you have; this is something that your clinics can take advantage of to help further their knowledge in certain areas. How has that helped your clinics and your teams grow as leaders and owners?

 

Nick Weber

We all take that leap from treating patients to being responsible for a team or responsible for a clinic—the amount of information that comes at you like a fire hose. You just don’t grasp it all. Having structure and resources available as you go is super important. What we learned early on is that if we set people up for success early and keep things really simple, they have a much better long-term track record. What I mean by that is that running a clinic can be easy if you keep this simple thing in mind: the decision that’s good for the patient. Because if you can tie all your decisions to that, that breaks it down to the most easy necessity. For instance, if clinics are closed today, can we shift schedules? That’s tough because people have childcare or days off or whatever, but what’s the best decision for the patient, and how can we balance that with what our staffing is? 

Another example would be that I’ve got all these patients I can’t hire. What’s the best decision for a patient? As a clinic owner, if you see more patients, it helps your clinic become more profitable. There’s more profit to distribute and more benefits to that, so it makes more sense to see the patient. That trickles into all of our KPIs and analytics as well. There are probably too many of them, but at the core of what we do, if we can keep it simple about our high satisfaction, that means our patients are happy, so they’re going to come in. That’s good. That’s a good decision for patients. Are we seeing enough volume for the number of hours we have, and are the outcomes good? If outcomes are good and the volumes are high, that’s a good decision for the patient. As long as we can keep coming back to that, we’re making good sense. 

Where the mentoring comes in is that they can be that other voice to come in from a 10,000-foot view and look at the landscape and bring their experience and story to the clinic director. That clinic director is very boots on the ground, very four walls, and obviously they understand what’s going on around them, but not to the extent where somebody’s spending time on purpose outside of a clinic. That pairs really nicely with making decisions and giving support to nourish that entrepreneurial spirit without feeling like you’re constantly drinking from a fire hose, and the mentors there kind of lessen the background noise and make it easier to make a decision day to day, week to week, and month to month. That’s just better for the patients and better for the business.

 

Allison Jones

Absolutely. That’s a fantastic program to have in place. Now, you mentioned KPIs. Is there a certain set of KPIs that each clinic needs to report to Team Rehabilitation that show that they’re on track?

 

Nick Weber

We have data for everything, and for each data point we really want, we make sure we pull back to patient care. I wouldn’t say the clinics report back because all of that data is at our fingertips through our EMR and external sources. We have the analytics. What we want is for our clinic directors to understand what they need and feel comfortable with them. It is kind of an “if this, then what” type of scenario. If volumes are up, profits are down, and if quality is up, satisfaction is down. If one of those markers goes above or below where we’re either expected to be or where the company averages, what’s the decision that you need to make, and how do you communicate that decision with your team? Ideally, we want it to be really simple. We want everybody to just focus on the most important aspects of making the patient happy. That’s visits, productivity, some measure of that, quality, and outcomes. We’re using MIPS like everybody else with Medicare. We want to prove that we’re the best as part of our mission. 

Documentation:  I think as far as a specific KPI, Team’s got what we want to shoot for, but that individuality we talked about is somebody who’s got a clinic full of pelvic floor care, or geriatric fall risk, or a strictly neuro clinic versus a high-volume sports or ortho only clinic. Those poor activities are wildly different, but those clinics are wildly successful. We understand that, and we understand if there is a deviation from the norm. As long as everything else is okay, we’re in a good spot. However, we want to be able to look at that KPI, how it affects patient care, and, if so, what type of scenario. We have the ability, through that mentoring program and that communication from the clinic to the mentors to me and all that channel flowing well, that we can help support decisions that they can make day to day, week to week, so that it is an easy decision to make. 

 

Allison Jones

How does this all tie together to impact patient care? You have your own ownership model, the mentor program, and Team Rehabilitation’s corporate structure. How does all of this come together and impact your patient care?

 

Nick Weber

In a vacuum, it sounds super easy, but that goes out the window as soon as the door unlocks. Our goal is to recruit and hire the best people, giving them the focus and the simple instructions to do what’s best for the patient. That front office person, or PACs that we call them, wants to protect the patient to make sure they get the visit. They also want to protect the therapists from overbooking themselves. That communication and collaboration are understood, and it is a nice back and forth because everybody’s happy taking care of patients. When the ability to take care of patients has become too much because there’s not enough hours, we have support to send treater hours from a central pool of floaters or ask for help from other clinics. That’s where teamwork comes in to doing what’s best for the patient. 

Those mentors can work on collaborating on some of that in the background because the clinic director is so focused on running their day-to-day on a larger scale as insurance makes a change. That’s up to me to coordinate information between the back end of the beast all the way down to the front end, and we’ll work on that and give them the best filtered answer so they can just focus on patient care and then look up, give them an answer, and they can go back and forth with us and what that is, or talk to their mentor or have a better idea, and then we can provide it from there. Then they can go right back to running their business day-to-day. That’s how it does work, and that’s how committed we are—the non-clinical side of Team Rehab to continuing to make it efficient. As all these changes bombard our profession, we want to dummy them down to make them as simple and digestible as possible so that we can keep Team, “Team”, and have great people who just care about taking great care of patients. It is not a perfect system, but it’s one that we’re continuously working on transforming to make it as efficient as possible.

 

Allison Jones

I have to say, if you have 99% patient satisfaction, I think you guys are doing a pretty good job.

 

Nick Weber

Our patients are definitely happy, which is awesome. Being out of the clinic was hard, and coming out of the clinic was difficult, and I certainly miss it. I love what I do because I truly feel like I’m fulfilling my goal, which is wanting to help people, and I get to do it on a gigantic scale. However, if I ever get tired of looking at things or running meetings, all I have to do is go to the clinic. I have to go to a clinic where the energy and buzz as you walk in can be felt, and I have to have that connection back to the clinic. If I go to my old clinic, chances are there’s a patient I used to see there. I remember telling my wife, “If I’m ever grumpy or not having a great day, just remind me to get out of the office and go to the clinic, take a meeting there, and spend some time there.” In less than a minute or two, it is immediately refreshing to see why we do everything we do.

 

Allison Jones

Yeah, you can see the impact. That’s fantastic. What is the next step for Team Rehab? What’s next on the agenda?

 

Nick Weber

What we want to do is keep Team, “Team”. Our goal, if you break it down, is to be the best therapists in our regions. We’re going to prove that with our quality outcomes and patient satisfaction. We’re going to be widely employee-owned. Between the clinics, everybody has ownership; all the ownership at the Team Rehab level was widely employee owned. Obviously, we want to be profitable. With margin compression from the cost of everything going up and reimbursement going down, we have to work really hard at transforming team processes in order to keep Team, “Team.” What I mean by that is to fulfill the mission while also focusing on making patients happy. All our decisions about doing the right thing for patients, having great benefits, great compensation, and a place for people to grow—whether it’s growing as a therapist, growing from tech to whatever job you want in health care, or evolving your back-office skills—we need that. 

In order to keep Team, “Team”, we have to change the way we do things. Like any good entrepreneur or any good story of growth, you have to evolve. You have to have a growth mindset all the time. You can’t stay stuck. You can’t lament constantly for days in the past. Running a clinic in 2024 is different than it was in 2018, even in 2022. We want to make sure we can keep the “Team” way, and keep growing to give more people the opportunity that I had to run a clinic. Our future is protecting Team Rehab by evolving it. We are absolutely back in growth mode, which is super fun. We definitely took a pause on purpose to get our legs underneath us, but we have probably at least 10% new clinic growth for next year and then at least 15% to 20% growth in visits and revenue. We’re in growth mode, where we’re going after increasing the Team Rehab way while keeping the core of what’s important to the team intact as we transform in order to really thrive in the next couple of years.

 

Allison Jones

If there is a therapist, front office staff person, or anybody else within the space that’s looking to become part of the Team Rehab family, where can they go to find out if there’s an opportunity available to them?

 

Nick Weber

First of all, the answer is that there are tons. Second of all, our website, team-rehab.com, has great updates on what it’s like to be here at Team. The photos are outstanding, both in the clinic and among the staff; there’s a bio; our quality measures are populating the landing sites; and it’s just an easy click on our job board. We’re also all over all the hiring sites, Glassdoor especially, and we have a 4.2-star rating, which is the best as of the end of December. That was the best in our sizeable industry. We’re not going to touch Apple or Google; I don’t think that’s a fair comparison. Actually, that is one thing. I really wish they’d separate client- and patient-facing employers from the Googles of the world, who have all these other amazing things. Dealing with people is awesome, and it takes a special person. It’s so rewarding that I hope everybody who’s thinking about it gives it a chance and comes check us out. Team-rehab.com is the easiest place.

 

Allison Jones

Excellent. It’s certainly you, folks, who have put together a really special organization, and it is amazing to learn a little bit more about it today. I really appreciate you sharing the Team Rehab story with us and with the Therapy Matters community.

Nick Weber

Thank you for having me out. This was really good. I really enjoyed talking with you.

 

Allison Jones

Excellent. I think we are out of time for today. Thank you again for joining us. I want to say thank you to our audience for tuning into the Therapy Matters podcast, your one-stop resource for expert insights and advice on everything therapy and rehab. We look forward to seeing you in the next episode. Thank you.

 

Allison Jones

Thanks for listening to Therapy Matters. Do you like the podcast? Give us a five-star rating, subscribe, and tell all your friends about the show. Want to be a guest or know someone that would be a great guest speaker? Contact me at allison.jones@raintreeinc.com. Therapy Matters is brought to you by Raintree, therapy and rehab’s favorite EMR. Raintree is the only all-in-one therapy EMR, delivering a complete and seamless end-to-end patient journey from first contact to payment to patient retention. To learn more about Raintree, visit us online at raintreeinc.com.

 

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