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part of shaping the future of Dentistry. This
is Ruth Hat with the Breakfast Stencil Bust
podcast. I'm thrilled to be joined today by
Richard Hall. President and Ceo of Us oral
surgery Management.
Richard, thank you so much for being here
today.
Good morning, R. Thank you for having me.
Great. So just to start us off, could
you introduce yourself and tell us a bit
about your background?
Yeah. Sure. I've been in health care services
for
I guess, 40 plus years now.
I started my
career with large,
Fortune 500 companies and health care services.
And then about 10 to 12 years into
my cri
transitioned into
more entrepreneurial types of private
backed companies, both private equity and of venture
capital.
So this is my ninth roll now in
a Pe or venture backed business, And I
think I've worked with
13 different firms
along the way. I've been with with
Us oral surgery management as the president and
Ceo since the inception
of the company back in late 20 17,
And today, we're in 28 states with 200
plus locations
and 240,
you know, oral surgeon partners.
That's great. It sounds like you have a
lot of great experience there. What kind of
interested you about the dental space in particular?
Yeah. I think the the thing that interested
me more than anything else was a couple
things. 1, specifically, oral surgery,
I was I was intrigued by the fact
that no other company had begun to
partner with oral surgeons the way that we
have seen other companies
develop in in this in the dental space.
And I thought the specialty of oral surgery
was, particularly interesting the founder of our company,
Pat Haynes,
with the T group,
developed a unique equity model,
that
made
the surgeons true
equity partners
in the parent company. So today,
about 52 percent of Us oral surgery is
actually owned by
our partner,
oral surgeons and that that kind of model
was interesting to me. I had I had
worked in a physician practice management type of
model previously with Us
oncology
and really liked
working with the surgeons or the the physicians
on a on a day to day basis,
And then last but not least, I just
think that there's a tremendous opportunity to bring,
you know, efficiency
and
business best practice you know, to these types
of health care
organizations who maybe have not had that
previously.
So those were the things that attracted me
to the dental space.
Interesting. Thank you.
What are the biggest issues you're following in
Dental today?
There's a couple on the macro level, and
then
1 in particular that, you know, we're heads
down on within our business right now. On
on the macro,
level as we look at dental
overall.
Medical loss ratio is beginning to find its
way into the dental space. So I think
most executives in the dental space will be
watching that carefully as as more and more
estates adopt
medical loss ratio and and work through the
details of of each state program to see.
If in fact, it's it's going to be,
you know, a positive thing for all of
us or, you know, perhaps a challenge. I
don't think we know that,
for sure yet.
Another key issue that we're all watching, I
think is
new regulations around non compete agreements and what
impact that we'll have on,
you know, our business models and what changes
we may may need to make going forward.
And then last, but not least,
and maybe not last, but the other thing
that I think about is
adoption of technology,
and Ai in the coming years. I think
that there's gonna be a lot of opportunity
to
improve efficiency see
through the adoption of additional technologies and particularly
Ai
as we find more and more applications
for health care delivery
in those types of technologies.
And then on the company
specific,
we're dealing with, change health
cyber attack issue right now,
that's affected many, many health care providers,
both in dental and in general health care
around the country. So And,
you know, our team has responded exceptionally well
to this challenge.
And, hopefully, you know, we'll we'll be in
full recovery mode.
From from this attack within the next several
weeks, but
it's it's been a challenge
since it occurred
in in mid February.
Interesting. Thank you. I'm curious,
you know, what are your thoughts on how
the the non compete decision that came out
recently.
Will affect the dental industry as a whole?
Yeah. Well, you know, I think it's it's
yet to be seen if it will actually
go into law and it's adopted form. There's
already been
many lawsuits
filed and and challenges, you know, to the
legislation.
So we'll see... We'll have to play it
out a little bit and see, you know,
what ultimately
becomes law. But I think that you know,
in our models, no 1 is really trying
to keep anyone from working. But when you
spend multi millions of dollars
in enterprise value for a business, and the
the bulk of that,
business value
is represented in the goodwill
created by the provider.
These non competes really are
designed
to, you know, protect the risk of that
investment more than anything else. So
if if they do, you know, eliminate
non competes in their present form. They may
have carve outs or
non competes for, you know, value receiving kind
and and those kinds of things.
And then, you know, if they were to
go away in their entirety,
there there would be other ways that, you
know, you could perhaps
achieve some of the same protection through other
mechanisms
in in contract language. But as I said,
I think, it's it's yet to be seen
whether
it will it will you know, become law
in its present form.
Interesting. Thank you.
What are you most excited about and what
makes you nervous and dental today?
What I'm most excited about is we're still
a very early stage agent. As it as
it relates to oral surgery and the specialties
in general,
you know, general dentistry was the first
area where we saw private equity backed businesses
and
large forms of consolidation. They've been they've been
you know, occurring now for, you know, several
decades,
specialties, though are,
relatively new
with us, you know, getting our business in
in late 20 17. So we're about 6
and a half years into this.
And I think that the growth opportunity ahead
of us, only about 11 percent or so
of the specialty currently
is,
consolidated in the form of working with a
company like ours or or others.
So a lot of white space left. And
so that's what I'm most excited about is
the growth opportunity.
But
the thing that keeps me up at night
or makes me most nervous is is currently
the macroeconomic
markets
you know, the cost of capital, the interest
rates being what they are. And the new
staffing
you know,
expectations. Staffing has been a a great concern
for dental,
both in the area of, you know, h
genesis, assistance, surgical texts, etcetera.
As we compete with a a workforce that
is going largely remote.
And, obviously, you can't deliver health care
not at least at this point in time
in remotely. So our our workers need to
be in in the practices working every day.
And that's created a a staffing challenge
for us across across the sector.
Interesting. And and what are you doing
Us o,
to kinda combat that staffing challenge.
Yeah. I think we've had to get more
creative
than ever before, You know, when
inflation hit 9 percent or so,
we put in AAS
for all of our
team members across the board,
we increased their salaries by 3 percent as
long as the consumer price index remained above
5 percent.
We put in gas
Sp ins
for,
our team members who were called upon to
support multiple
sites of service so that as they drove
to those sites of service, they were being
compensated
for the gas that they were consuming
to support support the practice. We've added more
training and development
over the last year to help our our
new team members
assimilate into the organization more effectively,
and then offer them more training and career
opportunities
than than perhaps, we've we've done in the
past.
So we've really tried to, you know, address
it through, you know, more creative, you know,
approaches,
but it still remains a challenge today.
Thanks for sharing.
What will the most effective health care leaders
need to be successful in the next 2
to 3 years?
Yeah. I think it it goes beyond
health care, but I think leaders in general
are going to have to adapt to the
new reality in the labor force, regardless of
what industry you're in. Health care being, you
know, maybe a little bit unique
for the for the reason I mentioned earlier
about not being able to do most of
the care delivery
remotely.
That that presents, you know, unique challenges.
So leaders are gonna have to be creative,
adaptive.
They're really gonna have to be
open to new ideas and and new ways
of of doing thing. Things. And I think
that leads to being open
to and planning for the adoption of new
technology
and Ai. As I as I said earlier,
I think that in health delivery, specifically,
as we look at the challenge of continuing
to provide a high quality,
clinical outcome as well as a patient experience
and then also
provide our team members
with a great place to work and and
a place that they can be excited about
as it pertains to delivering that care either
directly or indirectly.
The adoption of technology
and Ai are gonna really play, you know,
big roles in that you know, going forward.
So I think all leaders are going... Are
going to have to really open themselves up
and and adapt
to the changes that their businesses and and
the industry are facing.
Great. Thank you.
Well, Richard, thank you so much for your
time and your insights today. It look forward
to connecting with you again in the future.
Thank you very much, chris. Appreciate the time.
Awesome. And for our podcasting listening, that is
the end into the podcast,
richard great great conversation today, lots of great
insights. Thank you so much.
Thank you. Appreciate the opportunity.