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On Demand - Empowering Independence: The Journey o ...
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So, today's story is one of empowering independence, and this is the story of a group in Colorado that has partnered with one of MedAxiom's partners, Heart and Vascular Partners, so partners three times in one sentence there, but to really found and start a new program. Today's panelists are Bill Dracoff, and Bill is the CEO of Heart and Vascular Partners, as well as Peter Byrd, who is the COO of Heart and Vascular Partners, representing one half of the equation in this group formation and the story that you're going to hear today. The other half is on the physician side, so Dr. Chris Kim, who is a physician partner at Colorado Springs Cardiology, and Dr. Peter Krakard, who is another physician partner at Colorado Springs Cardiology. And so, this is going to be a very open panel discussion, and we look forward to getting some of your comments and questions throughout. So, thanks to all of you for being here today and for being able to share your story. I gave very short introductions, and they were robbing you of the quality of the contributions that you have made, so I'd like to start by actually having you guys each introduce yourselves, and I'd like to start with you, Bill, if I could. Sure. Thanks, Joe, and welcome to everyone joining us. Thanks for investing the time. We're very excited to have this discussion and share it with you. I am Bill Dracoff, the CEO of Heart and Vascular Partners. We're an MSO dedicated solely to supporting independent cardiovascular practices across the country. I'm not going to give a big commercial or talk too much about our firm or what we do, because the real substance is in the example here with Colorado Springs. In many ways, it embodies why we started our firm and what we endeavor to do, which is support great physicians and strong market positions, develop even more of an independent practice and regain more control and freedom about how they deliver care to their communities. And I hope you all get the opportunity to learn from them how we've enabled that and all the work we have still in front of us. And Joe, if it's all right, I'll pass to Peter and we can kind of go around. But throughout this discussion, the importance of our team and how they work with the physicians is really led by Peter Byrd in Colorado. Peter, please introduce yourself briefly. Yeah. Thanks, Bill. And thank you, everybody, for joining. Really thrilled to have the opportunity today to present alongside Dr. Kim and Dr. Kreekard. We've been partnered together to create a new practice environment for CSCD over the course of almost a year now, even before we were formally partnered with one another. So like Bill mentioned, a big part of what we do at Heart and Vascular Partners is look for opportunities to help build, execute, and maintain practice infrastructure that allows physicians to be physicians and enhance their service to patients. Really a lot of what we talk about today is going to be centered around the how for a group that was effectively creating a brand new practice environment and really looking forward to hearing about, you know, from Dr. Kim and Dr. Kreekard, their perspective and matching that up in terms of how we built an alignment structure that really helped us do that in a way that was, you know, very effective and we're already starting to see some of the fruits of our labor. So I'll pass it over to Dr. Kim for a quick introduction. Thank you. Thank you, Bill. Thank you, Peter. And thanks for everyone who's able to sign on. My name is Chris Kim. I'm the President Managing Partner with Colorado Springs Cardiology. I've been with the group for almost a decade now and I've been in Colorado Springs for almost 20 years now. So hopefully we'll be able to present some information that's helpful to you guys going forward. Okay. All right. Peter, you're up. Hi, I'm Pete Kreekard. There's two Peters, so I'll go by Pete for this meeting. But yeah, I'm a non-interventional cardiologist, been with the group at Colorado Springs Cardiology for about 10 years and currently the Vice Managing Partner. So Chris and I, you know, we're very involved in leading the group kind of in this direction. So, you know, glad everybody was able to call in and hopefully it'll be informational for everybody. Well, we'll thank you all for adding a little bit more color and context to your backgrounds and vision and purpose for being here today. So thank you for that. And I think that, you know, as we start thinking about, you know, private equity and making these transitions, I think the first question really is why. Why would you do something like this? What are you seeking to gain? And now that you've done it, has it really made a difference in your practice? And so I'd like to start with you, Dr. Kreekard, or you, Dr. Kim, to give us some insight into that why and how that's working out so far. Okay. All right. Well, obviously the decision to move to a more independent model was obviously not a quick one. I mean, we looked into it for over a year. It took us several meetings, group meetings, and to come to a conclusion that we had just a few options. Okay. As a, we have a unique situation in that we are a private group, but yet our PSA has pushed us or pushed us to the point where we were nearing employment model. And I suspect a lot of the physicians out there are either employees or about, or essentially feel like employees. And the ones that aren't are essentially all by themselves, just as a single solo group, just trying to survive right now. And so given the complexity and the cost that was going to be involved with going totally on our own and the infrastructure necessary, we didn't feel like that was going to be feasible. So the good thing about HVP is they provide an alternative where they are able to provide capital and also more importantly, provide support and resources going forward. And so, you know, that's the good thing about private equity is that they're very helpful. They kind of, they're kind of the in between the going all by yourself, solo, high capital cost, you know, developing your own infrastructure versus employment. So it's a good, good hybrid or a good compromise. And you know, in our, in our position, that was, that was the best option for us going forward because my partners unbeknownst to me, I knew we were fiercely independent. We're a lifestyle group, you know, we're in Colorado. We all like to ski and go outdoors and play golf and have a good time. But, but they are fiercely independent and employment was not an option. So as managing partner and device managing partners, we had to come up with an option that would allow them to have flexibility going forward. Okay. Well, that, that does provide a great deal of context. You talked about additional resources and capital and things of that nature. I think that's really seen as one of the benefits of going with private equity, but there's also usually a concern over operational decisions, right? And so, and so my follow-on question really for either of you is, as you have, you know, maintained control over operational decisions, how has that navigated with cardiovascular partners? What is that like in terms of other, any operational decisions you kind of co-navigate? And how has, have you been able to now with both resources and operational control, you know, has it improved your practice as a whole and your ability to deliver care to patients? So I know that's a lot of questions kind of all in one, but understanding that resource base and how it's really driving operational and clinical outcomes. Right. Yeah. I guess I can take at least part of that. You know, I, like Chris said, you know, with our group being very independent and I mean, I think that's consistent with most, you know, physicians and cardiologists, it was really important that we maintained control over our clinical practice and HVP partners with us to manage the business side and administrative side. And that's clear in our contract, but also just clear in all of our interactions, you know, so far is really maintaining that, that separation. So, you know, there hasn't been any real input or changes into our clinical practice, our day-to-day clinical practice. It's really focused on how we get the business side up and running, because like Chris mentioned, you know, we were, we were in a PSA where we didn't have any infrastructure whatsoever. We had clinic space at the hospital. All of the staff was employed by the hospital. So we basically had our physician partners and our APPs and that's it. We had no clinic, we had no EMR, we had no nursing staff, no administration, schedulers, all of that. So when we were looking at options, we knew moving forward with the PSA wasn't going to work for us because like Chris said, it was just becoming too much like hospital employment. And moving completely out on our own, doing it all independently, just was overwhelming, both financially, you know, the amount of loans we would have had to have taken out to pay for all of that infrastructure and the administrative support, which we just didn't have. I mean, we, we really had to build up an entire practice from scratch. So that's really why we decided on a partnership with private equity. You know, it's that shared risk, shared expenses, and we let them do what they do really well, which is the business side, you know, the revenue cycle, the scheduling, the administration stuff. And we can focus more on the clinical stuff. And that's, so far, that's how it's, it's worked out. Yeah. I, I appreciate the difficulty in that and it's, it makes me reflect on the very beginning of this call where you both said you had been with a group for 10 years. And I said, you were founding a new group and it's essentially founding a new group as you just talked, Dr. Kreekart, about all of the things that you had to set up. You may have had a structure in that PSA model and you had your own group, but you didn't have a functioning practice that you fully controlled. And now you have that. And so to me, that's founding a new group, although there's, there's certainly nuance in me saying that. I think that as you work through those operational challenges and the staffing and the hiring and the purchasing of equipment and everything that you had to do to make that happen, it sounds like you got the support that you needed. I'm also curious then as you build out that level of support, there needs to be an economic model that follows that, right? Because there's a lot of investment on the front end. And so I'm curious about, from an economic perspective, the efficiency of the new model that you're in today versus what you transitioned from out of that PSA agreement and how the two compare for the program itself, for your practice and for the physicians individually, obviously not getting into specific numbers, but understanding how does this look economically? I'd look to either of you to answer that question. Chris, you want to take that or you want me to take that one? You go ahead, take it. Too deep of a question? You can pass. No, no, it's fine. I mean, broadly, you know, how it works is, you know, the private equity is essentially buying your practice, you know, so, and then as a result, you get some money up front for that purchase price, and then you share profits moving ahead. And that's kind of how it works. So initially, we're still, you know, pretty early in this. So I'd say it's a little hard to say exactly what it'll look like long term. We're also in the process of building an ASC, which I'm sure we'll talk more about too, which is a whole other venture, which will, you know, be profitable for us long term too. But it's a very different model. You know, we were straight RVU production based PSA practice. And now it's more of a shared kind of revenue, shared expenses model. There's certainly a lot more overhead, but there's more, you know, revenue too. So it's a different model. They take a percentage based on, you know, of those profits. So it's shared risk, shared profits. I think for us going forward, you know, when we looked at the finances and negotiated the purchase price and everything, they came with a very fair offer to where essentially this is going to be cost neutral for the next several years, I suspect. And that's my hope, that it'll be cost neutral, at least for the next several years, we'll have salary repair fairly promptly or fairly quickly. And that's probably the worst case scenario, that we'll be salary, we'll be cost neutral. The hope is, is that with improved efficiency, which I don't mean to offend anybody out there, but I think, you know, that hospital systems are very inefficient. And we were essentially almost employees of a hospital system. And it was very inefficient from just trying to see patients, get patients in. It was very frustrating because they would pinch pennies, you know, with staff that would inhibit us from seeing as many patients as we needed to. We had a backlog of patients that was three months long. And so, so, so just from improved efficiency alone, I think we'll be, we'll be better off going forward. Plus, we have the option or ability to invest and build our own ASC, which is something that we were prohibited from doing. And I suspect a lot of the members out there are prohibited from doing that also. But obviously, if you're an employee, you don't even have that option. You know, if you're an employee, you are, you know, you're, you're hourly worker, you know, you're hourly employee, unfortunately. And that's the bottom line. So, so this gives you, and I think, you know, when I started off the flexibility, this gives the partners a lot of flexibility also with their schedules and also with their finances going forward. Whereas in a fixed PSA or fixed employment model, you have a fixed salary basically. And so, I think this provides a lot of flexibility and a lot of control because we still control the clinical aspect of it, which is fantastic. And HVP has been very supportive of us on the business side of it, where we're very weak. Okay. I mean, we're just doctors, you know. Well, what I hear is that you've been able now to create more control over the patient care pathway, better monitor clinical outcomes and the patient experience, as well as being able to participate back in the technical revenue stream, which was really gone under your PSA. So, to me, it makes a lot of sense. And when you think about the importance of ASCs, and maybe we'll get there today, but the, I think that component of empowering physicians to be owners in those ASCs is an important, you know, retention and acquisition strategy for physicians these days. So I completely understand that. We did have a question come across, and I think this is one that makes sense to inject into the conversation, as opposed to wait till the end, if we could. And I think this is also maybe a good transition point where I'd like to hear the physician perspective. And I'd like to hear from you, Bill and Peter, as well. And that is, how did the hospital react to this decision? And were they supportive? Were they angry? Was there, you know, a transition period of that? I love the person that asked the question, you know, has experienced some of this themselves. And so I think to hear about your experience would be really worthwhile. So either of you as physicians, and then transitioning, I think, to get that answer, or Bill, if you want to step in. Well, sure. I'll take it and then hand it off, just in terms of how we approached it, in terms of our dialogue with the hospital, which took on its own life and had different turns as we go. And then hand it over to the doctors and Peter to talk about, like, how that played out. But we approached these partnerships with, you know, prepare for the worst sort of planning. So we, like, what if it were a nuclear option, or the hospital reacted in the most adverse way? How could we withstand that and maintain our independence? So there are certain decisions we made, investments we made out of pocket before engaging the hospital, so that when doctors Kim and Krieger, with Peter, went to the table with the health system to have the discussion to renegotiate a new PSA, which is also part of the economic model going forward, we were in the best position and had the most leverage as a truly independent group at that point in the path to doing it completely on our own, if they didn't support us. It is important for all of our groups to have really good relationships with the systems and their markets, for a lot of obvious reasons. So we don't approach these things in a, you know, a priori hostile approach. But we need to prepare for that, if that's the reaction we do see from the hospitals. So maybe, Peter, if you want to talk about some of those initial discussions, I know there was some fits and starts, and then above from the physicians, as you guys were on the ground with the staff and with the hospital administrators, how that evolved for you as well. First, just kind of getting right down to the question, you know, the hospital's reaction in this particular case was one where I think they took a little bit of time to consider what it meant for them, right, and to process what all, you know, through taking on a partner and also taking on a more independent stance meant as far as the relationship moving forward. I think pretty quickly, you know, we tried our best to make it clear that, to Bill's point, we had no intention of making it an antagonistic discussion. You know, from the outset, you know, I think the group made it clear that the intention was to move to an independent practice model for the benefit of efficiency and a better experience for patients. And then with that as a backdrop, you know, we were able to understand what about the relationship had to change just structurally. Obviously, we were going to be employing staff, we were going to be setting up brand new practice infrastructure that would have an impact both for the hospital on a go-forward basis, but also for the relationship writ large. You know, but over the past number of months, since we had the initial discussion with the hospital, you know, we tried to build a collaborative relationship really over a couple of different things. One being an effective and efficient transition from the old model to the new model, which is not an easy undertaking when you're talking about, you know, large amounts of staff, coordination of different clinics, scheduling, rescheduling patients, you know, and what have you. There are a lot of logistical aspects of that, where a group that's been aligned with the hospital for 10 years, unwinding that and shifting it really requires a lot of change. So we wanted to be as collaborative as possible with the hospital to manage the transition just from a purely operational perspective. The second piece of it really came around envisioning our future with the hospital and saying, you know, that this partnership between HP and Colorado Parks and Recreation is going to change the relationship, but it shouldn't change it fundamentally in terms of a commitment to one another. And I think as part of that, you know, we've been successful in continuing our aligned service around outreach clinics outside of Colorado Springs, the implementation of an aligned EMR system, finalizing a renewed PSA. You know, in a short period of a few months, we were able to renegotiate a PSA that continued to cover all medical directorships, you name it. And a lot of that's just scratching the surface around what we're going to be able to do moving forward with the hospital. So, you know, it signified a turning point or an inflection point in the relationship with the group, but not a departure from partnership over the long term. But Dr. Kim, Dr. Krieger, I'd love to hear your thoughts as you have the more longstanding relationship with the hospital and can maybe speak a little bit more to how that relationship has shifted to both what Bill said and what I mentioned as far as thinking a little bit more long term and a little bit less about the day-to-day. I mean, from our perspective, you know, I appreciate HVP. We were able to come up with a plan going forward prior to giving notice. As Bill said, you know, whether or not they were going to explode and we were going to have to go with a nuclear option or whether or not they were going to be okay with alignment. And fortunately, we had a pretty good relationship with the hospital. And also, fortunately or unfortunately for us, well, fortunately for us, unfortunately for them, we're a vital asset for the hospital. We were the only private group in town. And so, the other hospital, there are employed physicians. So, it would be very difficult for them to replace, you know, 20 physicians and 17 APPs. So, that gave us a big advantage. And I think they recognize that. I think the most important thing that we got out of it is that they actually respect us now. Before, you know, they just looked at us as a bunch of physicians that like cattle that they were herding to employment. And we were following that model for the past decade. And we just kept capitulating over and over and over. And, you know, it just came to a break point. And now, in our discussions with the hospital, it's more even. You know, it's peer-to-peer now instead of, you know, employer-employee. And so, and that's about, that's the biggest thing that I've seen since our alignment with HVP and our discussions with the hospital. And Pete, Peter, Pete, go ahead just with your comments about how you think it's gone so far. Yeah, it's, it's, it's a great question. And one that we had lots of discussion about with our group and with HVP. You know, the, the goal was always to maintain a relationship with the hospital and continue to do all of the inpatient work that's so important, you know, to the practice and the community. So, you know, part of it is like what Chris said was leverage. Our group maybe had more than, than others, maybe less than others, but in our particular situation, we were a large practice, well-established in the community, long relationship with the hospital and no other competing private groups nearby that could jump in and start doing work for us. So that may not be the same for every group out there, but for us, it gave us a lot of leverage in the negotiation. They needed us as much as we needed them. And so, so it has become, I think, more of a partnership. And there is a question that I can answer in the Q and A that, that goes along with this, which is until the ASC is complete, are you still able to perform interventions in the hospital cath lab? Yeah, absolutely. So that, that was, I mean, like I said, that that was a big part of the negotiation. We definitely wanted to maintain the hospital relationship, continue to do all of our outpatient procedures in the hospital until we have the ASC built. So yeah, that was, that was a part of the negotiation. Awesome. And, and just to comment, I mean, I know that we're spouting off a lot of information, but, you know, our ACHB partners have been through this. And so they were helping us help guide us through this, of what we needed going forward. We kind of had an idea of, of, of what we needed negotiating going forward, but their experience, and I mean, that made all the difference in the world. They were able to cover the points, the major items that need to be taken care of going forward from a business perspective. And we were of course, able to advise them from a clinical perspective, what we needed to do, you know, cover the hospital, cover our patients for call interventions, things like that. Yeah. So from a, from a capital, starting back at the beginning of our webinar, from a capital perspective, from a decision-making perspective, from a clinical excellence perspective, from a opportunity to build a new revenue model, including technical revenue and everything else that you've got there from a relationship perspective, you know, it sounds like they probably were taken a little, taken aback a little bit when you said, Hey, we want to become our own group, but you guys have now continued that decade long relationship and are continuing to serve those hospitals and that community and those patients. And so that's very positive. All of that can only happen if there's also a very good transition and the operations match the intent and the strategy. And so what I want to do is kind of, you know, maybe turn to you, Peter, as COO to say, what was that like? And a little bit more away from the why and start maybe shifting us towards the, how did you help with that transition to to this newly formed slash already existing group? What was that like from your perspective and how do you make that go smoothly? Yeah, sure. I appreciate the question. And it's one that we could probably spend a couple of hours on if we really wanted to, you know, oftentimes, and I think it's discussed often in the industry, the idea of pulling a group out of quote unquote employment or a restricted PSA or what have you, the most daunting part about it is that they oftentimes don't own any of their non-clinical assets. So when it became clear that Colorado Springs Cardiology and HVP were going to partner with one another, even months before we formalized that partnership, you know, our first objective was that, you know, we knew that we were going to have a ticking clock once we formalized the partnership in order to set up the new environment. Given the structure and the out of the PSA, we were going to have three, maybe four, maybe five months in order to set up a brand new practice environment for the physicians. As most folks who are on the phone or otherwise are aware, three to five months is not enough time to register with Medicare under, you know, a new tax ID, get commercial contracts, build out office space, get equipment signed up, onboard 100 plus employees, establish a new EMR, you name it. And one of the realizations we had was that we needed to start work on that before we were even formally partnered together with Colorado Springs Cardiology. So the first step for us was to take a full inventory of all the items that we needed to have done. What could we do, you know, in a non-partnered environment to basically put in sweat equity before we start stroking checks, you know, employing folks under a new tax ID, you name it, and try to do as much of that prior to the transaction closing as possible. The next piece was in between the transaction closing and what we'll call our go live date, making it abundantly clear what are critical items to making sure that the physicians can see patients the day that we turn on the switch. And then we have the infrastructure to schedule patients, bill for services, and that all of the employees of the practice, whether physicians, APPs, or staff members, have a clear place to go and an understanding of what we need to be doing. Because from a patient perspective, what we absolutely wouldn't be able to stomach would be a scenario where, you know, we're not ready or clinics closed or what have you. So through that process, you know, the biggest things that we did in those first few months before the transaction closed was convene a steering committee of partner physicians who are going to be very involved in the design, but also many aspects of the execution of setting up what the infrastructure was going to look like. Number two was we got immediately to work on securing clinic space, negotiating vendor contracts, and setting up an organizational HR structure that was going to allow us to move very quickly during that two to three month process. The last thing that I would say that I absolutely wouldn't under club here was getting a practice operations leadership team in place that was incredibly strong. You know, we hired a practice administrator, Tiffany Morrow, who came with a lot of years of experience, multiple different private practice environments, as well as inside of a hospital, and understood all the competing priorities, not just of starting up a new practice brand new, but also transitioning an existing practice in mid-flight where, you know, they shut down under the umbrella of the old entity on Friday and reopened on Monday. You know, we had to have folks who understood both sides of that. And then, you know, the last thing was just maintaining and gaining a better understanding as cardiovascular partners. You know, we didn't have long-standing ties in the community or a great understanding of the practice's clinical priorities on a day-to-day basis. So working with both the physicians and legacy staff members who were trusted by the physicians in order to make sure that we were designing the new practice in a way that was consistent with the old was very, very important to us. So it was a lot of coordination, a lot of phone calls, a lot of committees and subcommittees around individual aspects of the practice creation that really got us to a process-driven output where we were all in alignment around what had to be done. And then we were able to shift very quickly towards an execution model, you know, on a weekly or monthly basis, making sure that we were tracking along with our expectations. So I have heard, and what a challenging process. I can't imagine doing that as quickly as you guys had to do it. You deserve a cape for that and some superhero bobblehead for that. So that's awesome. What I have heard, and one of the things we say is when there's a disintegration or a separation or an unwinding, we actually say it's a complete, it's not disintegration, it's disintegration. This, you know, these physicians go this way and these physicians go this way. And so it's very hard to make that a unified separation. It's been done. It's very, very, very hard. My question to you then would be, how did you focus on really maintaining all of that engagement and the coordination of all those different stakeholders? That means the physicians in the group, it means, you know, support personnel and technologists and executives you're bringing on, as well as with the hospital. What is the secret to that? Because you guys did it very well, and there's secret sauce there. I want to see if you'll share it with me. Yeah, sure. So, I mean, you hit the nail on the head with one of the first things, and I think there might be a unique aspect to this group that I've kind of said throughout the process as far as physician engagement. You can't just build a box and expect physicians to walk right into it. The physicians need to play an active role in understanding what the environment needs to look like, how it needs to get built, and they need to be along for the ride. It can't be a vendor-client relationship. It really needs to be a true partnership. And from the outset, you know, just it's a credit to Dr. Kim and Dr. Kreekert and their partners more broadly for the willingness to engage. You know, there are a number of physicians within the practice, not just Dr. Kim and Dr. Kreekert as the designated leaders of the group who have stepped in to lead specific initiatives. So, you know, we had our weekly steering committees that started in January. We didn't close the deal until May, and those continued after deal closed until Go Live, where we had a steering committee of roughly nine physicians, and I would say that those weekly meetings were attended at a rate of 85% plus by all physicians every single week. And, you know, it was giving up times with their family, giving up, you know, the precious moments before starting clinic or walking into the cath lab where physicians were steadfast in their commitment to providing their input, making sure that the vision is seen, and bringing up potential issues that we could mitigate that might be hidden to us as a business operations team, but the physicians had a unique understanding of. I think secondary to that, we created steering committees that go all the way from physician credentialing, EMR setup, ASC development, physician recruitment, you name it, with individual physicians basically named as champions to work through that. You know, on the business operations side, it requires a lot of coordination and project planning. So, you know, obviously I wear an operations hat within HVP, but there's a whole team of folks within Heart and Vascular Partners who help support this. So, you know, whether it's our HR team helping to, number one, secure benefits platform for all the physicians and APPs, and then staff members as well, or going out and resourcing an interview process for over a hundred employees outside of providers within this group. You know, interviewing them, onboarding them, getting them enrolled in benefits, making sure that everybody had a computer and a laptop and a sign-in, you name it, you know, and being able to work with that group along with practice administration was hugely valuable. Similarly, setting up IT required a massive investment on the part of both Heart and Vascular Partners, but then also individual physicians within the practice who had a clear understanding of what they needed, whether it was, you know, PAC system setup, integration with the EMR, you know, setting up the EMR itself, and then all of the other technology-related tools that are required in order to run outpatient cardiovascular practice. You know, lastly, I would say the revenue cycle process. So, we talked a little bit about setting up a new tax ID number. That meant that this group was going to be billing on their own behalf for the first time in 10 plus years, you know, so setting up a tax ID, registering with Medicare, getting commercial payers involved, credentialed with effective dates, effective as of our start date. The HVP revenue cycle team was hugely valuable in doing that along with the on-site business office manager, you know, and that's even before we go into the provider credentialing aspect where we were counting on individual providers to provide their login to CAQH and their resumes and up-to-date work history and you name it, and we were able to turn all of that around so quickly that even the condensed timeline didn't restrict us from opening up day one. So, it was a lot of work with a lot of coordination, but also having clearly defined roles both within the physician partnership of who was going to be the champion of an individual initiative, all the way to heart and vascular partners, various support departments in order to go hand in glove with the practice operations team to go out and execute. Gotcha. Yeah, if it sounds like a lot of work, it was a lot of work. It sounds like more than that. So, your question, I think, is answered in a lot of the depth that Peter just went into. The original one about alignment, like how do you maintain unity both within the stakeholders themselves as a group of physicians or a team on the MSO side and then together? And really, it's through earning the credibility and then maintaining transparency and diligence throughout the process. So, back in January, before we had consummated any sort of partnership or transaction, it was on us to share with the physicians our vision, how we would do it, all that detail that Peter's went through. We laid it out in the charts and project planning and then we showed them a vision of the economic model as well of like, hey, this is what the payoff could be for you taking this step and moving that way. And we can do that from our experience and we can share, yeah, we have a pretty good idea of what this practice will look like in an independent model before an ASC with all the other things we can bring and add and then with that ASC down the road. That was really important to lock arms. And then once we made that decision together, when we became a partner in their practice, then it's reinforced by all the communications, transparency of data, weekly check-ins and moving along, that helped reinforce that. But honestly, once we became a partner, the boats were burned, right? Like we're going and we're going to build this thing. And you can reinforce that initial trust by delivering on the details and on the rigor that Peter just described and all the physicians took part in as well. That to me is, that's what we're trying to do every time. And that's the sort of partnership we're looking to build. It's very much more than transactional. And it's not, I think sometimes people think of private equity as a series of deals or transactions. This is operational partnership as we go forward. And I'll underline once and I'll, and then hand it back. But when Peter talked about the unique strengths of this particular partnership, doctors Kim and Krieger and their partners represented a uniquely committed and strong partnership. And there were, you know, folks objecting to one thing or another throughout, and we had to slow down and deal with that and make sure everyone felt comfortable moving forward. But once we're going, we're going. And that's how we're able to get to where we are today was with that trust in each other. I love that. And I love the decisiveness and the power in those statements. And as you think about, you know, from your perspective, Bill, this massive transition, and we've heard some of the physician side and we've heard from the operations component of that, but what was maybe the highlights or the most critical parts for you in terms of finding the right partners and developing the right culture? And what was there one or two, maybe, you know, standout lessons there that you learned that you'll carry into future deals that you do? Sure. And we've touched on, happily touched on them kind of throughout, and I'll maybe come back with some emphasis, but again, I'll start with, this is why we built the company. Like this is the sort of partnership and the sort of work that we set out to do. So I'm privileged to have a teammate like Peter and all the folks he supports in operations so that we can do this gritty work and really roll up our sleeves with the practices. That's how we anticipate in our scene, the value get unlocked. But even at the very outset, when doctors Kim and Krieker were talking about their position in Colorado Springs, I think one lesson that really was reinforced through this is, you know, exhibit a lot of discipline and good judgment in terms of which partners you pick, both in terms of their composition and the quality of work they do and the quality of that partnership, but also which markets you're gonna go into. So Dr. Kim was explaining, you know, the unique value in the position that they had, both with the health system, but also with the broader community. That's really important to us. So when we're out going to market and we're in several discussions, really all the time, we're looking for the right group in the right market position that we can work with. And we certainly found that here. The second lesson that was reinforced in some of it, you know, we do more or less of, but was in preparing for independence in full before we engaged with this actual separation or the standing up of a new group. Peter touched on this briefly, but having an EMR secured sounds kind of mundane or whatever, it's a really big deal. So these physicians didn't own that, didn't own all the rights to use that information when you're stopping Friday and starting Monday. So we, with the support of our private equity sponsor, took some risks. Like we signed contracts, we engaged a new third-party relationships, we got resources in place so that we could have a discussion that as Dr. Kim said, created some mutual respect across the table as opposed to a one-way PSA discussion. And the last piece, again, kind of building on some of the themes that we've heard, getting A-plus talent early and on the ground. Peter mentioned Tiffany, our administrator there, we hired her with the review and involvement of the physicians from outside the market, brought her into Colorado Springs, and she quickly then moved through a hierarchy of hiring great managers who then in turn continue to build up the functions. But the people cliche is well worn out, but for us, we've recognized the importance of having someone who was waking up in the morning with the express purpose of moving the ball down the field on this project every day and working closely with those physicians. And we certainly had a little bit of luck, I think, in finding as much talent as we did early, but we also think when you see the opportunity you get to work with these physicians, it helps attract good people to good projects. So those are the three I think about. Pick your partners in your spot the right way, make sure you're fully prepared for independence and get good people on the ground early to help execute. I love that. And I think you've got a lot of control over that when you put somebody like Peter in and you don't have to hire local, but you can get very, very high quality folks and put them in Colorado Springs. When you get to the level of MAs and RNs and sometimes technologists, you're looking more at a local market. And so my question is really about any of the challenges maybe that you faced in that, because A, you've got to staff up a whole practice and then B, you've also got people who were at the hospital that now were employed by the hospital that may be coming to work with you. And is that a symbiotic thing? I'm sure some of those people you wanted to come over and the physicians absolutely wanted to absorb them and the hospital said, great. And there may have been some that you didn't want to absorb because they weren't a fit culturally or from a skills perspective. So I just think all of this as well happening at a time when this country was undergoing even more than it is today, a staffing crisis, right? So tell me just a little bit, and I know I just threw a bunch of things out there and this is open to any of the four of you, but I would love to hear some dynamics around absorbing staff or not absorbing staff and recruitment to achieve some kind of stability during this transition. I don't know if anyone wants to comment on that. I'd like to defer to the physicians just leading in with it. You're exactly right, Joe. That was, of course, there's a lot of overlap in the populations at the hospital and then who came over. And that was something that had to be delicately managed and communicated with the hospital system, but Drs. Kim and Krieger, please take a shot at addressing that question. Yeah, it was, I mean, it's tricky. I would say we ended up hiring about half new staff from outside the old kind of practice hospital system and brought about half along with us. In some respects, it's nice because we were able to kind of pick and choose who we wanted to come, like you said, who had a cultural fit. We knew kind of who the hard workers were, the ones that we knew would thrive in the new environment, but it was also difficult because that meant that some people that we were working with before would not be offered jobs at the new clinic as well. So it was tricky. I'd say, I think the staffing part was probably the most difficult for the transition because we had to ramp down in the old office as we were ramping up in the new office, knowing the right timing for when to bring staff over so that they're ready to go when the new office opens, but not too early so that the old office is too short staffed. That was a very difficult. And making sure that we had enough staff to keep going in the old office, flip a switch, new staff is ready in the new office, very tricky. So yeah, the staffing part was, from my standpoint, was probably the rockiest, but fortunately we had really good managers, really good operations in place to help with the transition. And to Dr. Krieger's point, I'd say we'd be lying if we said that that aspect of the transition was at all smooth just because of the timing elements that he mentioned. It's incredibly tricky to try to run full speed in two separate environments effectively simultaneously, but I know a lot of the collaboration, both from the CSC Go Forward team, as well as the hospital on the previous side, I think collectively did the best that we could in order to ensure that, make sure that the staff are taken care of. The one thing that I would say from our perspective outside looking in kind of on an HPP level is there were also a number of staff members that when we were posting positions for the new entity, had maybe left the hospital and had previously worked with the groups that were really excited about the chance to go back and work with the physicians in a new independent setting. And I think that's a wonderful start from a cultural standpoint for the staff, right? It's a lot of folks who are really, really excited because there are great physicians to work with. It's a great practice that's been well-established and respected in the community for a long time. And the refreshing aspect of working in a new environment, I think has attracted some folks who hadn't worked with the practice in three, four, five years to come back and either take leadership roles or staff roles or what have you. And that's a testament to the group of physicians that we're working with, that it's somewhat of a magnet effect for folks who really wanted to continue to work with them. And it mitigated some of those market issues that you referenced, Joe, where for the last two or three years, it's been incredibly challenging to find staff. We've had some challenges, but nowhere near what we've seen more broadly in the market. So thank you for that. This whole lift, I mean, guys, we could do this literally for eight hours and cover a quarter of it. I mean, there's so much nuance to the things that you're sharing. And I wanna make sure that we're also giving others a chance to post some questions. So I will prompt to everybody in the audience, if you'd like, go out to the Q&A section at the bottom of your screen and feel free to ask a question and we'll get to it. And while we wait for you to enter a couple of those, I just have one final question for you, Bill. And I'm just interested in, as you look back on conversation one, should we do this to where you are today, any reflections about this that you wanna share or how you apply these lessons to future partnerships just differently than, I mean, I know you've shared a lot kind of along that regard, but is there anything else that maybe stands out that you'd like to share before we close? Well, just appreciation. I mean, I talked about some of the things we've learned or reinforced what we thought we knew, but it's been a tremendous amount of work really on all sides. And again, it's validating, right? This is the vision that we started our company with and talking to the private equity guys day one, we knew we'd have to enable this sort of transition if we wanted to be successful in the long run and partnering with cardiologists, most of whom are in similar situations. So first one out of the gate, a lot of lessons learned, which we've discussed, but it really validates why we exist. And I hope to be talking about this next year and having more affirmations from Colorado Springs in terms of how it's transformed their practice, but we're certainly excited. And just from my perspective, grateful for the opportunity. Thanks, Bill. I appreciate that. Peter, I'm gonna ask you for any final thoughts or comments. And before I have you answer, I just wanna remind everybody that if you have additional questions, feel free to send them in, but also in the chat, you will see a PDF slide deck. You can download that. And there's links where you can reach out to Drs. Kim and Krieger, or if you would like to reach Peter or Bill, you can do that. So that's where you'll find their contact information for a direct reach out. But any final thoughts, Peter? No. Well, I have one final thought, and it's somewhat of a word of thanks and another word of advice to other folks who are looking to go out and do this. But the physicians, not just Dr. Kim and Krieger here, the collaborative aspect of working with them is really the only thing that would have made this work to begin with. They're in these types of transitions, but also partnerships more broadly. The work of establishing trust and trusting immediately and then working together to work through any issues or barriers that arise is absolutely critical when you're trying to execute as fast as we were here, with the scale of work that was in play. So as other folks are maybe thinking about making a transition or taking on a partner, what have you, biggest thing on both sides of the equation, both as the MSO platform and as physicians, I think the most important thing is to find folks who you trust, who you have an aligned vision with, and you understand that you can work through issues that pop up in a collaborative fashion to keep the train on the tracks, if you will. And that's something that I've valued through this process, and I'm looking forward to a long time of partnering with these guys down in Colorado Springs. I love it. Thank you so much. I wanna give both of our physicians a chance for just last comments and thoughts as well. And Dr. Kim, I'll start with you. And I wanna also, maybe you can work into your answer, if appropriate, a question that's come across, which is, will the hospital be involved as an owner in the ASC? So if you can work that into final thoughts, great. And if not, that's okay. So yeah, this is, I don't wanna steal the thunder from a famous coach, but this is a process. It's not this whole transition from near employment at PSA to partnering with a private equity firm and then going alone and starting a new practice. We are a new practice, a new entity. And we definitely could not, looking back at things, I can tell you, Pete can tell you that we could not have done this by ourselves, okay? It's because we were essentially coming from an employment model. And so I think that that will hopefully help out some of the folks out there since the majority, I believe a majority of the cardiologists now are employed now throughout the country. Is that correct? Yeah. That is. So essentially we were an employment model and we had a no compete clause and everything for all intents and purposes. We managed ourselves, we managed our EPPs and that was it. So it is doable, it is possible. And I think Peter Byrd and Bill, they have a good playbook to execute and get it done, okay? And from a clinical perspective, obviously Pete and I, we're going through it, we've lived through it, we've survived and we can provide advice there. And you're exactly right. Fortunately, we're trying to develop or we've developed a symbiotic relationship with the hospital actually. And we still provide hospital coverage for their inpatient work and also for call coverage and also some of the outreach. And going forward, we are actually presently in negotiation with regard to how we're gonna integrate them into our future ventures. They are very interested because, this group has been around since 1973. So we're ingrained in the community. So when they hear Colorado Springs Cardiology, that's what the patients and that's what the community hears is Colorado Springs Cardiology. And whether or not we're aligned with one hospital system or another, it's Cardiology Springs Cardiology that they're coming to come see. So that is something that is possible. It's a great question. I just wonder who it came from. But Peter Byrd and Bill can comment on that because we are actually in active negotiations. Got it. Well, that's good insight. We'll leave it at that. And then Dr. Krieger, again, we are over time, but I'd love to make sure that you've got 30 seconds to share your final thoughts before we end the webinar and maybe answer one question that came in, which is what happened to your relationships with vascular and cardiac surgery that still sit within the hospital? If you could incorporate that into your final thought, then we will end the webinar after that. So we were fortunate enough that we actually joined with our cardiac surgeons in this venture, kind of a vertical integration. So for us, it was easy. That may not be true of every situation. Yeah, closing thoughts. I mean, I would just say, if this is something that your group is thinking about, do your research, find the right partner. And that doesn't always mean just find the highest bidder. It's find someone that's gonna be heavy in operations, that's gonna, like we said, have boots on the ground, is gonna have people there locally to help you get through it and get things started. And that may not be the biggest, the most flashy piece of the contract when you look at somebody that's making you an offer, but it's really important to find the right partner and someone that's really gonna be there throughout, even after the transition. So yeah, do your research and don't be afraid to interview multiple groups. So. Thank you, Dr. Krieger, Dr. Kim, Peter, Bill. Thank you both so much as well. So this will bring today's webinar to a close. As a final reminder, inside of the chat, you will find a PDF that has a way to contact all four of our presenters individually. This is what it will look like inside of the PDF. And you do have, again, opportunities to grab that from the chat area. Thanks to all four of you. I really appreciate the time today. We went over, but we didn't really lose people in that process, which is very strange. And it tells you how attuned they were to this message and listening in today. So thank you and thanks everybody for attending and taking time out of your day to share this with us. And that will conclude today's webinar. Thank you, everyone.
Video Summary
In this webinar, Dr. Kim and Dr. Kreeger of Colorado Springs Cardiology discussed their transition from an employment model to partnering with a private equity firm and starting their own practice. They highlighted the importance of finding the right partner and the value of having an operation team to guide them through the process. They emphasized the need for collaboration, trust, and a shared vision when working with partners. They also discussed the challenges and lessons learned during the transition, including the staffing process and the need for careful timing and coordination. The webinar also touched on the hospital's reaction to the decision and the importance of maintaining a positive relationship with the hospital. The physicians and the operations team worked together to ensure a smooth transition, and their partnership allowed them to gain more control over their clinical practice and improve the delivery of care to their patients. Overall, the webinar emphasized the importance of finding the right partners, planning and preparation, and effective communication and collaboration throughout the transition process.
Keywords
webinar
transition
employment model
private equity
partnership
collaboration
challenges
lessons learned
hospital reaction
smooth transition
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