Practice Nirvana - Million Dollar Practice, Without the Grind

So one thing to keep in mind is this isn't necessarily the right model for everybody. The, you know, this is, you know, pushing up into that kind of $100,000 to $150,000 a month. And again, that may not be everyone's goals, and that's okay, right? But What I do love about this is it creates a tremendous amount of freedom for the doctor, for the owner, and gives them a practice that is generating significant revenue, that is creating tremendous freedom of time, energy, wealth for the doctor, the owner, and creates a model that either you can sell You know, in the marketplace, which is challenging to sell practices these days, but, you know, the tide will shift and it'll become easier at some point. Private equity is coming into more into chiropractic as well these days. So that presents opportunities for doctors. But it also allows you to essentially retire in practice by then selling it to your associate. So all of these are options. So let's go ahead and dig in. Practice nirvana. The perfect practice for the future of chiropractic. Now, I do do a more detailed look at this in week 4. So if you want to take a look at that as well. So, have you ever thought, I want to work smarter, not harder? Like, how many of— we hear this so often, right? It's almost become a cliché, but it doesn't mean that it's not a worthy goal. Or you think, well, I want to make more, but I don't want to adjust, you know, a million patients per week. And, um, you know, Dr. Jeff, when he was with us, he would always say, you know, we only have so many adjustments in our body. And that is true, you know. Um, I think we also need to be cognizant of what happens after practice. Like, we don't want to just like kind of work our body to a point where we can't then enjoy our retirement. So, this model allows and adjusts for that. So, adjust, no pun, but so that you can start to minimize the wear and tear on your body. And some doctors say, well, gosh, other people seem to have this figured out. Like, what am I doing wrong? And The reality is you're not doing anything wrong, um, necessarily. Um, but we may not have the right pieces in place to attain this. Uh, that's why I want to go through this today. Um, and so if you ever thought anything along these lines, uh, first, you're not alone. Um, I would probably say most doctors that have been in practice for, you know, 10 years, 15 years have thought along these lines. So we've cracked the code. Um, and we call it Practice Nirvana. And so first, let's look at some of the challenges with the current chiropractic model. So in the current model, um, you know, if— raise your hand if you think insurance is going to get better. It's— it is not, right? Insurance companies, as we all know, it is, um, a sick care model. Um, they are not interested in the health of, uh, the patients. They are not interested in, you know, the, uh, paying doctors what they're worth. They are interested in their bottom line, pleasing their shareholders, holding on to money as much as possible and as long as possible. Um, and so because of that, um, you know, insurance payments are just going to continue to dwindle. Um, it's going to be harder and harder to make even what you made last year. And, you know, now we obviously have preauthorization in some insurance companies. So it's— I don't say that to scare you. It's just a reality. We need to be cognizant of what is happening in our industry. And we want to then obviously take our practice into our own hands and so that we can hedge against that future. I typically don't say just get out of insurance. That is a challenging model. Like, if you, if you go all cash, like all, all cash, um, it can absolutely be done, but it is a challenging model. Patients have insurance, they want to use insurance, um, if, if even only for a small portion of their, um, plans. So, um, I don't typically recommend that, um, and, uh, You know, and that's okay. We— there's a way to look at like the, the, you know, what are the best insurances that are currently available? What are the most popular ones? And then what are the bad ones? And then just, you just kind of slowly weed yourself out of the bad ones and just hold on to the good ones. It's pretty, you know, pretty simple. Other challenges with the current chiropractic model: we're trading time for money. Um, and that's obviously is limited by, you know, the amount of time that we have in a, in a day. Um, continued wear and tear on the body, like we talked about before. Um, not maximizing our scope of practice. This is a big one, right? Because if we, um, you know, say only do chiropractic, well, um, there's a lot of other things that we are able to practice in and take advantage of or help patients with. Right. Um, being all things in the business, you know, head cook, waiter, you know, dishwasher, busboy— obviously the analogy in the, in the restaurant business. Um, that is typical in the chiropractic practice, wearing too many hats. Um, paying for vacations twice. Um, in other words, so when you go on vacation, you obviously pay for the vacation itself, and then you Pay for it in lack of revenue, creating a glorified job. In other words, if we stop working, we stop making money, and a low value placed on core product and services. So I think a lot of this we always we already recognize in this group, but you know just want to review it again. A lot of times we need to be more reminded versus being taught. So what if we could turn it on its head? We could work less, we could make more, we could increase the value of the practice, uh, we could max out the potential of the practice, we could build a proper team and leverage, we can vacation at will, build a business and an asset that works for you, and then create a stronger retirement. So Sounds pretty good. This is what the model of our practice nirvana is built around. So it is a blend of insurance and cash-based services. We are positioned as a premium service and experience. It's lower volume, high cash. The associate obviously is part of the of the equation. Does Really all of the chiropractic exams and the bulk of the adjusting. So, you know, if you're saying or seeing, you know, say 30 to 40 adjustments per day, they're going to do 75% of that, you know, maybe even 90% of that. And, you know, we all had the patients have seen us forever. They only want us to adjust them. That You know, and you can continue to do that, but the bulk of the adjusting is done by the associate. The owner focuses, focuses on leadership and expertise. The staff handles the bulk of patient care, the daily, you know, on the niches, putting patients on and off the table, putting patients on and off laser, on and off shockwave, etc. And we have a comprehensive and competitive marketing that drives quality new patients through the door. And they recognize the value that you provide. So this is what the team looks like. We have the owner, lead doctor, associate doctor. We have a patient success manager. This is the key, really the key role in the whole practice. We would think it's the associate, but really this is the role because they are going to be both the closer. And they're going to be operations manager, office manager, you know, whatever you want to call it. Now, why is that so important? It's because this is going— this associate doctor is not going to be closing when you take vacations. This person is. Right. So that's why we need this, this role that is You know, and we'll go into some of the characteristics of that individual, but they are going to be the ones that talk all the finances. They're going to be the ones that manage the team. They are going to be the ones that manage payroll. All the things that are probably on your plate now is going to be on this person's docket now. A lot of people, our doctors will have an office manager, and typically that's kind of more of a glorified CA. They've worked at the practice forever. This is typically a higher version of that. About 3 techs. So with volume, with this volume being in the 100 to 150 range, we're going to need And we'll go, we'll go into the equipment in a second, but essentially, um, 1 tech for 2 tables and then, um, 2 techs dedicated to laser and/or shockwave, typically at least laser, and then we add shockwave, and obviously a great receptionist. So the equipment, 2 decompression tables. So this allows us, the decompression tables, to process a minimum of 10 new starts a month. About 5 per table. 1 table, you know, in our model, in the 3-2-1 model, can process 5 to 7. So 7 would be maxed out. 5 is a little more comfortable. 2 Class 4 lasers. We do ideally want the unattended lasers if you have an attended laser, then you're going to probably need one more tech, right? Because you're going to need one tech per laser. And then one, you know, so that's 2 techs, an additional— so you have one for the 2 tables, 2 on lasers, and then one additional for shockwave. But if you have the unattended, Then you can have 1 tech for 2 tables and 1 tech for 2 lasers, and then 1 tech for the shockwaves. 2 knee decompression. Obviously, you know, we're leaning— we're going in this direction. We're gonna have 2 niches, 2 shockwaves. This could actually probably just be 1 shockwave. And the reason why we want shockwave is because we're going to pair that up on the, on the knee niche, an orthotic station, um, because we're using orthotics both in our decompression protocol and our knee protocol, a supplementation line, and obviously our chiropractic tables. So what does it look like in action? Well, the owner is going to be focused on leadership. In other words, where is the practice going to be in 3 to 5 years? Um, How do you create a culture in the practice where people stay forever? And again, a lot of— I highly encourage you, if you don't set up a one-on-one with Dr. Pankinen at least once a month, I think you're leaving a lot of value on the table. You know, same thing with Dr. Vinny. If you're not setting up a one-on-one with Dr. Vinny once a month just to go through closing, like, you know, bring, bring 2 or 3, you know, ROFs that didn't start and go through the objections and what you could have done differently. Meet with Dr. Pinkerton regularly. You know, talk about his model. Hey, you know, what was the, you know, what was the linchpin between like 2 years ago to now? You know, what changed? How did you train your associate? How did you bring your associate on? How do you pay your associate? What does the contract look like? Like, um, there is no reason— if, if you're not kind of where you want to be, there's no reason to, to figure it out on your own. That's the reason why you're in this group. Um, and, um, and obviously I'm here as well. We're typically meeting, but we're usually going over, you know, make sure stats are on track. And, you know, we can go through all these questions as well. But my— I guess my point with this is Dr. Pagan is in the mix of it right now, right, doing this. And so if this is attractive to you, you know, again, learn from, from his experience because he's, you know, he's in it real time. Positioning. Um, so when I say positioning, we're talking about, hey, writing books, doing a podcast, um, going on other podcasts, um, uh, you know, doing radio, um, getting out in community, developing joint, uh, uh, joint, uh, you know, kind of partnerships with other businesses. Uh, when you have more time and you're not kind of in the weeds every single day, it gives you that, um, that freedom to, to get out and, and expand the awareness of the practice. Um, and then of course evaluating and qualifying patients for the niches, right? So you're, you know, when you're actually in the practice on a daily basis, you're going to really be focused on the niches. Um, uh, Jessica says get involved in community events. Yeah, 100%. Um, the associate is going to do the bulk of the exams. Now, you're still going to do the exams for the niches, right? So, um, because we, we need to do that world-class exam specifically for these patients, the associate will do all the exams on the chiro. Um, and then again, more and more of the adjusting. You really want it to kind of push up to that kind of 80 to 90% of the adjusting. Your PSM, your patient success manager/closer. Ops manager will then do the enrollment, right? And what's great about this is that now you have— well, first you're able to separate doctor and finances. And in the beginning, I recommend that the doctor does do the finances because when you— if, when you bring this role on, you You're going to need to train them, right? You're going to need to coach the PSM up on, you know, hey, so this person, you know, didn't close. You know, what were their objections? You know, how did you counter those objections? What were the financing options you provided? What is our— because they didn't close, but what does our follow-up process look like? So in other words, you need to be that mentor to the PSM. So, but if you've never done it or if you haven't done it at a high level, then it's hard to train the PSM. So, but, but now this individual is going to have, you know, KPIs or key performance indicators that you're going to track on a monthly basis. Now, these may— this may sound a little bit foreign to you. This is when you elevate, right? When you go to that next level. But the point being is Um, that's the role that they're going to own, uh, on the closing side. And again, that's what's going to create the freedom, because now you can not be in the office and patients will still close. Um, now you're saying, well, how would that happen if I'm on vacation? I'm not doing the patient, um, you know, evaluations for the niches. It goes to the associate, right? We don't stop marketing for niches when you go on vacation. It just goes to the associate. The associate will be trained up on a world-class exam as well. Mm-hmm. And they will be doing, you know, while you're out, all the evaluations, and then the PSM will be closing. And they will manage the clinic, right? They're not going to be in the room, you know, on these, the financials, you know, all day, every day, by any stretch of the imagination. You know, they may have 2 to 4 a day, something like that. So their other role really is taking all of that management stuff, off your practice, off your plate, you know. So, uh, again, payroll, managing team, running team meetings, um, uh, looking at your P&L on a weekly basis, um, tracking your new patient flow, um, and then just giving you reports. Um, that again creates tremendous amount of freedom. We, we know the role of the techs, right? They're going to do the daily patient care for, for the niches. Um, And then a receptionist, or what I like to call the ambassador at the front desk. This is the rock star, right? We need someone that's, you know, super outgoing, represents the clinic at a high level, greets patients in, you know, in a wonderful manner so that patients feel seen, heard, that they want to come in. They develop relationships with that individual and is a rock star on the phone. So your focus, like we talked about, is leadership and positioning. So like Dr. Bankman, you know, he has his reports, he has a podcast, he is on radio on a regular basis, you know, newspaper. Obviously, we're running all his paid media on Facebook, Instagram, and Google. Team building strategy for the practice. You know, again, like, where do we want to be in 3 years? Do we do we want to you know do we need to expand? Do we just want to optimize this one location? Do we need more associates? Do we you know what type of relationships? What kind of businesses do we want to align ourselves with? All these things. You know, when you have the time to think about it. Uh, first, like, before something like becomes a reality, first we need to think about it, right? We need to have some goals. Okay, well, what is possible for this clinic? Um, what can the practice look like in 3 years? Um, and then how would we go about doing that? So, um, you know, it all starts in the mind, but if we, if we are in the weeds all day, every day, it's really tough to kind of expand out. You know what I'm saying? So we need that extra time. To be able to get there. Um, and then, of course, evaluating, qualifying your niche patients, right? Becoming an expert in the clinical niches. Um, and this is key, uh, excellent communicator with your patients. Um, when we kind of play at that higher level in terms of, you know, high, high-value niches, uh, it's really important to elevate our communication. Skill sets as well. You know, that's, that's why we have Dr. Vinny as well as a coach, because he's, you know, really gone to the next level in this. And that is a key component. And so if you have a PSM in place, then, you know, the more work you can do in the consult and exam, you know, finding that lever or that trigger, conveying that to the PSM, and, you know, and then in the ROF, conveying the value of what you do, You know, tying the outcome of what they're looking to achieve to your service. All of that's going to set up the PSM for, for success. But, but developing that, those communication skill sets is really critical at this level. And, you know, if you go through week 6, there's about 7 hours of advanced sales and persuasion training ethically applied to high-ticket niches. So, um, your focus in this model is not on your payroll, your bills, your managing, managing staff, your chiropractic exams, the chiropractic adjustments, paperwork, billing notes. This, this is where your focus is not, right? And this is the stuff that I think doctors by and large is what is, what is most frustrating to them. And so that was why we, you know, developed this model. And so this is a delegation thing. So in terms of— let's look at the rough overhead. Hmm. You're going to obviously get a salary. And these— look, I put these a little high on purpose, but, but they're not far off, right? So you need a salary. I mean, you're going to take distributions. In other words, you know, from the net profit, but you have to pay yourself a reasonable salary according to the IRS. Like, you can't pay yourself $3,000 a month to pay the most minimum in payroll taxes. That's my point here. So you got to pay yourself. In other words, and they, you know, and I'm no tax expert, but the point being is what I've been told is that if you were to leave What would be a, you know, a competitive salary if you were to replace yourself? And so that would not be $3,000 a month, right? So you're going to get paid a salary roughly, you know, roughly $10,000. Your associate doctor— now, in terms of associates, I really like an individual— I've always said this— it's the quote-unquote failed chiropractor, the person that, you know, $5,000 to $10,000 a month. They're a really good adjuster. They're great with patients. They just can't figure out the, the business side, the marketing side, et cetera. Um, yeah, let alone, like, moving into niches and all that. So, um, this individual, they just, they, they want stability and they want to be a chiropractor, right? This is what they went to school for. They just want to be a chiropractor. Um, they're not They're not— excuse me one sec. They're not responsible for marketing. They're not responsible for running the team. They're not responsible for any of that. All they do is they're a great adjuster. They're great with patients. They show up on time. They get a good salary. They, they get time off, you know, a couple of vacations a year, etc. That's how you retain a good associate. It's typically not the young gun out of school. Unless you're going to do the retire-in-practice model. So, and that's what Dr. Pankina did. He did get, you know, a new graduate. And so, the goal is to, you know, keep him long-term in the practice, then retire in practice, sell it to him. So, there's a couple options to go there. But for most doctors, finding an associate is typically you're going to have more longevity. Because if you go with the young person out of school and they are super driven, they're going to want to start their own practice, right? They don't want to wait 10 or 20 years for you to retire, is essentially my point here. And so, you'll lose them. And what you really want is longevity, retention in your associate. And that's why you get someone that's already tried to do it on their own and wasn't able to do it. Right. Now they make a good salary. They can grow, you know, they can have bonuses and all that type of stuff. But you're going to need to pay them, right? Your PSM, you're going to have to pay them well too, right? Because if they're going to be able to operate at this level and they're going to be driving revenue for the practice, they're going to need to be able to see a long-term vision for themselves within your practice. And, you know, I was— this was explained to me. I thought it was a really good analogy. In other words, like, your vision for the practice, if you want retention with your staff— and by the way, turnover in staff is one of the biggest challenges to practice— but if you want retention, your vision for the practice has to be big enough to have your team Like, see their vision within it. Does that make sense? Like, in other words, like, there needs to be enough growth opportunities within the business for them to see themselves working their way up so that they see it more as a career versus a job. And you'll hear Dr. Pankinen talk about that as well. So that's your PSM, 3 techs. You know, they're going to be in the neighborhood of $5K. per month, maybe not that much. Again, we're leaning higher. Receptionist, $5K a month. Again, maybe not that high. Oh, speak of Dr. Pankinen, he's joining. Again, we're looking for retention here. Marketing, about $10K a month. Miscellaneous, about $10K. So this is your, your kind of overhead. This is your miscellaneous overhead. And so total overhead with salary. So miscellaneous is like your rent, you know, software, your lease, you know, leases on the equipment, all that type of stuff. So, you know, while this— and that may— this may be a little bit low, but that's why we kind of compensate, right? Maybe, maybe we're not paying a receptionist $5K, you know, maybe we're not paying all our techs, you know, $5K each. So, but your overhead then is around $70K a month. In terms of revenue, the practice on the chiropractic side is around $40K a month. Your first niche, decompression, is around $40K a month, and your second niche is around $40K a month. So now, can these, you know, move? Yeah, of course, right? You can do a little bit more in chiropractic, a little less in the niches, but, but this is just some rough numbers, right? So if your care plan's around $5K, then you're going to be doing about 8 patients per niche. So gross revenue then is around $120K per month. Total revenue is about $1.4 million per year. Wow. Your overhead is about $70,000. So your net rev is about $50,000. Now, of course, you got to pay taxes, right? The government wants their money. So if you said on $50K is your net and say we do 30%, right? So $50,000 times 30% is $15,000. So $50,000 minus $15,000. So your net-net is around $35,000. When you're ready for it. Okay. So, and that adds up quickly. You know, if you're netting $35,000 a month, in other words, that's just going into your, your long-term savings every single month. What is that time for? Over 12 months. That means you're, you're putting away $420,000 per year. Right. So if you're able to— so let's, let's kind of, you know, pencil this out a little bit. Say you're able to achieve this in 3 years. Right. And then you're going to be in practice for another 10 years. So then just from your practice alone, You're going to be able to sock away $4.2 million. And that's not even accounting for if you're putting that into investments, you know, even in the market at 10% a year. So then that's compounding. So $4.2 probably goes to $6 to $7 over that timeframe. So the reason why I wanted to talk about those numbers is, you know, when we look at, oh my gosh, how are we going to get to $40K per niche and how are we going to hire this and do that? We also got to think about, well, whoa, that's pretty exciting. Like, we got to see what, like, the, the pot of gold at the end of the rainbow. We got to see that as well, right? Because that's the outcome. And it's the same thing, talk with patients. They're really excited about the outcome. They're not so excited about doing the daily visits over 90 days. So you— You may not be so excited about building this up initially, but the outcome is exciting, right? So we gotta have a big enough carrot, and that's a pretty big carrot, right? If you're thinking about $6 to $7 million from the practice alone over, you know, the next 10 years or so.