In this interview, Dr. Tom Nabaty, a physical medicine & rehab physician in Rochester, Michigan, recounts his journey from a traditional pain‑management practice to founding the Michigan Center for Regenerative Medicine (MCRM) and expanding into hormone, peptide, and IV therapies. He explains how a patient’s request for stem‑cell therapy in 2015 sparked his entry into orthobiologics, leading to the opening of MCRM in 2017. The conversation covers early business metrics (≈$500‑$600K revenue, 2‑day regenerative schedule), pricing evolution (PRP from ~$800 to $2,500; stem cells from $3,500 to $6,500; spine procedures up to $9,500), and the shift to an 80% out‑of‑pocket, 20% insurance mix that now generates over $2 million in gross revenue. Dr. Nabaty discusses the operational challenges of a hybrid model, the importance of defining culture, values, and a “vivid vision,” and how those guided strategic decisions. He describes the COVID‑19 shutdown, financial coping (PPP loan, personal savings), and the post‑pandemic rebound driven by a new facility, on‑site service lines, and a strong SEO/organic search presence. The interview concludes with his advice to clinicians: commit fully, accept short‑term revenue loss, and build a practice that offers control, purpose, and work‑life balance, while also outlining a platform vision to help other physicians transition part‑time into regenerative medicine.
Chapters
All right, everybody.
We have Dr. Tom Nabaty with Michigan Center for Regenerative Medicine and a host of other places. So, I did tell him, obviously I told him who you are, but tell him who you are, what you do, where you're located, all that kind of stuff.
Great. Yeah. So, Tom Nabaty, I'm a physician located outside Metro Detroit in Rochester, Michigan. I'm a physical medicine rehab specialist, subspecialty pain management. Started getting into orthobiologics and regenerative medicine. 2015 was my introductory year and opened the Michigan Center for Regenerative Medicine in 2017. And then from there, I've explored other ways to optimize patients to get better regenerative orthopedic outcomes. Led me into hormone replacement therapy, peptide therapy, IV therapy, and now we have clinics that provide all those services.
Awesome. So let's start back at the beginning. What Prompted you in 2015? You were in pain management then, right? You were mostly doing that kind of stuff, like blocks and all that stuff. What made you want to start to look at other options?
My patients actually coming to me with appreciative of the pain management blocks, the rehabs, the braces, everything we were doing short of surgery. One patient in particular didn't want a knee replacement, asked me about stem cell therapy if I thought it was reasonable. And at that time there were preliminary type research articles showing up in our journals. I told him, hey, yeah, it sounds like a viable option. Let's find somebody in Metro Detroit doing it. I did a Google search, couldn't find anybody I would've trusted myself with or my family member with. So I wasn't gonna recommend any of those providers at that time to my patients. Sent my patients to people that I had known in the industry, but outside Metro Detroit, people in Pittsburgh, particularly for this patient. Patient came back, had a great outcome, and really looked in the mirror and asked, if there's really nobody I can trust to send patients to in Metro Detroit, how hard can it be? Attended my first conference, the American Academy of Orthopedic Medicine, AAOM, in New Orleans, and just had my mind open.
Okay, so we met, I think It was late 2019, early '20, right before the pandemic. What was your business like at that time?
Volume-wise, I probably less than a million-dollar business, probably in the $500,000 to $600,000 range. I was at the time working 2 days a week in the regenerative practice, 3 days a week in the pain practice, and it was growing. It was kind of a steady improvement or steady growth. Our initial referral base was very much online. 90-plus percent of our patients found us via a Google search then. tended to be. It was a steady increase in volume, but still relatively slow, probably, you know, 5 to 15%.
What were you charging for an injection? Do you remember what those prices were?
Uh, yeah, I don't remember specifically. I want to say PRP was just below $1,000, $750 to $800. Stem cells were $3,500, I think, was what we were originally charging.
Okay, what are you charging now?
So our PRP starts at $2,500 and our stem cells start at $6,500. Then depending on whether we're doing added services, Anesthesia is included. If we're injecting intraosseous, then those charges go up. Maximum, the largest charge we have is a $9,500 procedure for spine.
And then what was it like having your foot one side in the insurance side, one side in the cash? What kind of blocks were you dealing with? What kind of mental challenges were you dealing with?
Yeah, so the, the insurance side has its barriers, primarily working with third parties, getting prior authorizations, getting reimbursement for your services, avoiding Clawbacks or denials where then you're chasing that money using collection agencies to get the patient portion of charges where the patients aren't paying, trying to do calculations where you can estimate what people's copays are going to be or coinsurance payments are going to be, trying to collect those at the time of service. The typical headaches that a traditional insurance-based medical practice deals with, we certainly were dealing with as we were building our practice, trying to be a hybrid clinic. And we still are a hybrid clinic in that we Still, you still use insurance?
You still use it as a lead gen?
We still use insurance for what we can bill, primarily consults. And some people aren't regenerative medicine candidates. You know, if you've had a spinal fusion and you're still having radicular pain or even axial low back pain and the levels above or below your fusion look good, it's not an adjacent segment disorder, which can be treated with regenerative medicine, but it's actually the area that's been fused or the knee replacement area that's been replaced. Yeah, we don't have regenerative medicine options that work well for that, but we do have, for example, stimulator options that that work well for that. So we still do that aspect of pain management. What we've stopped doing is any of the medication management aspect of the pain management.
Okay. So before we started working together, half a million dollars a year, working at a part-time in a sublet of an office, what specific changes did you make in your business in the time that we were working together?
So I'd say the first thing we really focused on is what culture do we want? What values do we have? How do we want to build this business? What's our vivid vision? Was the challenge you asked us to write up and loved your recommendation. Hey, you need to just Take a day off work, go out for a walk, spend the entire day just reminiscing, thinking about this, put it on paper, and then this is what you're going to make all of your business decisions based on. So we did that. That was step 1. It was a vital step for us to do. Looking back on that document, wow, has that been helpful for us. I share that document with other physicians now who are looking at joining our practice, and I tell them, here are the values that we prioritize. Here are the things that we make our decisions based on. And it's not profit. Are profits important? Absolutely. It's a business and we have to be profitable. It has to have enough revenue to generate so that people would continue to show up to work.
Yeah.
So our revenues, while they're strong, honestly, if we devoted as much time just doing insurance-based practice right now, it's about equal. Like for a good couple of years, 3 years, I was bringing home less than I would have, but I was so much happier. I had enough of financial security that I wasn't worried. I wasn't losing sleep anymore. And I think that's an important thing to be willing to sacrifice in the short run for for a long-term, financially secure practice that you like going to every day. I have taken one day off a week where I do admin work, I set up meetings, and I make sure I make time for myself. I do self-care.
So let's go over revenues. Let's talk about what the business looks like today.
Yeah, so the business today is 80% out-of-pocket pay, is the term I like. And the reason I like that is better than cash pay. So it's out-of-pocket pay, it's non-insurance-based pay, but we're 80% out-of-pocket pay, 20% insurance checks. I like that balance that we have. We'll top $2 million year in gross revenues. We have made the decision that we're gonna continue to expand, trying to build a platform for physicians to do very similar to what I did. Don't give up your day job, but give us 1 day a week and grow that to the point where their 1 day a week is full. And then give us 2 days a week and go down to 3 days a week in your day job, and then vice versa until you get to the balance that you want to keep.
And be involved with your family, right? Hang out with your kids.
I, I didn't put that one in, I guess, because that's always been a priority. I feel like I've always done that, but now I'm much more present. When I'm there mentally, I'm not drained like I used to be. I'm not as grumpy as I used to be. I'm not commuting like I used to commute. I've built this practice around my home community.
Would you say that's the biggest impact is control, or would it be something else?
Control. It would be big. I would say for me, it really is. It's the environment and the patient. I love going to work. I love the people I work with. I love the people I see as patients. Like, I like going to work and just, it feels like you're hanging out and you're doing a job that you really love doing. Like, I don't dread office days. I would say that would be my number one. But the close number two is the control of my schedule, the flexibility with my schedule, the idea that I feel financially secure enough that I don't have to go to work. I can take time off. And one of those things is purpose. And a lot of people lose their purpose or they want to lose their purpose because they just don't like what they've been feeling like they're forced that they've had to do. I don't feel that anymore.
Let's talk. I want to go back briefly. So COVID hit, right? So we start working, COVID hit. And what was your reaction? Because you're in Michigan, it was pretty draconian there. You were pretty concerned. You and John were pretty, pretty worried, huh?
Yeah, we were shut down. Both our pain incomes as well as our regenerative incomes went to zero, and our expenses did not go to zero. You know, the PPP loan, while it was helpful, was not very substantial for our company because we were not a big company at that point with a lot of employees. So we just didn't qualify for a whole lot of relief. And we dipped into retirement funds, we dipped into savings, and made some really tough choices and leaned into the fact that we have a good business And we know what we're doing and decided not to fold it. And we're able to keep it floating without going out and getting a bunch of expensive money or expensive loans, unsecured type debt. And, you know, we made it. It was touch and go.
But then what happened when you opened? Because we really used that time to kind of just really get zeroed in on the business. What happened when all of a sudden you were able to open?
Yeah, so we— when we were able to open, especially in our new facility, it really helped. Location was a big one for us, and being able to do all those services on site, have control over all of those different service lines, anesthesia service line, the lab service line really helped us schedule people quickly after they made the decision that they wanted to have the procedure done. I think that was a big one. So combination of location, of our patients' mindset seeking us out, the web traffic we had built during that timeline, the web presence we had built really helped our SEO and really designing our SEO appropriately. So Google AdWords— Google AdWords had gone away by that time, but Google organic search and having our keywords set really positioned us in a point where people could find us.
What would you say to somebody who's sitting at this event right now? They're hearing all of this. What would you tell them if they were considering to be working with our group, with Mavericks? What would you say to them?
So I think you got to commit yourself to this. If this is something you want to do, you got to dedicate time to it. And in order to do that, you're going to have to lose some revenue initially. You have to jump into this with the idea that I'm not just going to tip my toe in and see what happens. I'm going to make this work. This is going to become my job because I want it to become my job.
Great. Well, Dr. Nabaty, thank you so much for taking the time. I appreciate it. I'm sure hopefully everybody in the room appreciates it as well. I know the future is bright. I know you got a lot of things going on. I know you do a lot of work with IOF on the training side of things, I believe, and you're heavily involved in the community. So thanks again. Appreciate it.
Of course, Matt. I can't say thank you enough for helping us get to the point where we're at, and I know our paths are going to continue to cross as this Industry just continues to grow and we get more and more like-minded clinicians and industry leaders who want to build a wellness healthcare system, not just a sick care healthcare system, but one that keeps people healthy and keeps people well. And you're one of the biggest and brightest minds in that industry. So I appreciate you helping us.
