JULY 6, 2022 (20-MINUTE READ)

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Jason Schneller:

I do think it's worth the investment to go through a remodel. If it's well-planned and well-executed, and you're making the right investments, it is worth the cost.

Casey Lear:

Really, at the end of the day, when it all comes together and you can see the excitement on their face and hear it in their voice, it's just very rewarding.

Corey Brown:

I'm Corey Brown, and this is Provide's The Path to Owning It podcast, where I sit down with trusted industry experts in Provide's network to give you the tools and advice you need to take your practice ownership dreams into your own hands. From owning your own practice, to expanding or improving an existing practice, we'll help pave the way for you to achieve your dental or veterinary career dreams and guide you through all the nuances of the practice ownership journey.

Corey Brown:

Please make sure to follow us on Apple Podcasts, Spotify, or wherever else you listen. On this week's show, we're going to be discussing all you should consider when remodeling your healthcare practice. Our two guests today are Provide's experts on this topic, one in the field of construction and the other in finance. We're first joined by Casey Lear, senior project manager at Provide. He's been with the company since June of 2019, and has 20 years of experience in the construction industry after earning his degree in construction management from the University of Cincinnati. Casey, welcome. Glad to have you on the show today.

Casey Lear:

Thanks, Corey. Appreciate the invite.

Corey Brown:

Yeah, absolutely. Let's start, if you could just tell us a little bit more about your experience in the industry.

Casey Lear:

Yeah. As you said, graduated from University of Cincinnati with a degree in construction management. From there, jumped right into the commercial construction industry. I started with a general contractor on the commercial side basically acting as a superintendent, and then throughout the years, working my way into more of a project management role. But basically spent 15 years in the commercial construction industry on site every day, coordinating contractors and trade work, working with engineers, architects, clients, coordinating inspections, all those kinds of things.


Corey Brown:

In your opinion, how should a provider go about building a plan for their renovations? What are some of the first things they should act on?

Casey Lear:

Well, I think whether you're renovating your existing space or maybe you're going to switch locations all together and renovate a whole new location, I think connecting with either a designer or ... I know there's a lot of equipment reps out there that'll help in the design. That's your first step, is to engage a team of professionals that can help you with your layout, with the patient flow, all those kind of things. Once you have that started, you can start to work on your budgets, timelines and things like that.

Corey Brown:

I think most providers out there, the majority probably, have not really been through a remodel project or switching locations. As they start to begin that project, is there anything that a provider may not be aware of that they should definitely consider?

Casey Lear:

Yeah. Unfortunately right now, ever since COVID, I would say if your project is to the extent that you might need a building permit, one thing to consider for sure is that timeline. I think right now the timeline from having a design and getting a building permit has increased significantly. I would also say the same thing is happening with material prices. It's unfortunate, but it's everywhere right now. Same thing with construction.

Casey Lear:

I think the earlier on you can, again, engage that team, have a good plan moving forward and engage those construction professionals early on because they can help you down that path. Contractors know about material increases, they can prepare and plan for that. They know what the local building department timeline is, so they can help with that as well. Again, the earlier on that you can engage some design and construction professionals, the better.

Corey Brown:

Yeah. We're even seeing that just on local projects I'm doing at my own house or something. The cost of this material sometimes is making that impossible to do at this time. I can only imagine in a commercial setting, the drastic difference that would be. Would you say budgeting is something that providers should also really be conscious of during this time of rising cost of materials?

Casey Lear:

Yeah, definitely. I know our sales team does a great job of working up front with the clients and building in some padding to their budget, just so that when a client gets approved at a budget, I know the sales team is working with them to try and ensure that they're covered, even if there's some potential material prices. That way, if we do see those, we don't have to go back and try and get an increase from our credit department or anything like that.

Corey Brown:

There's some built-in leeway there, as I would imagine most construction projects would have.

Casey Lear:

Yeah, we definitely try to, especially these days as much as possible. But it gets a little tough sometimes, I think. But definitely keeping that in consideration is definitely key.

Corey Brown:

Tell me, I guess, about ... I would imagine that you get fairly close to these providers as you are working with them and remodeling or starting a new practice from scratch. What has it meant for you to be a project manager for these healthcare providers now as opposed to projects you had worked on in the past?

Casey Lear:

It's interesting because, like I said, we connect with these clients basically from the beginning. There's some clients that I've had relationships with for six or eight months, maybe just going through the whole process. Some even longer. It's great to see that progression. Like you said, you build a very personal relationship with our clients, and from start to finish, you can see the whole process starting to take shape, and living that journey with them is great because they know that whether it's a construction question or sometimes throughout the process, clients just have random questions or sometimes you just need to vent, right?

Casey Lear:

Sometimes it can get very chaotic and stressful, and I'm happy to be that person that they can reach out to, and one, ask very specific construction questions about, but two, just anything in general. It's nice that they've got my direct number, and if they've got questions like that, they know that they're able to reach out and connect directly with me and anyone on our team.

Corey Brown:

Yeah. That's so key. Just having that point of contact to actually reach when you do have those questions. I would imagine this would be a very stressful situation for most providers. They're probably putting one of the bigger investments they've made into something like this. Having somebody they could reach out to is fantastic. Is that a role that you always wanted to play when you started this construction industry? Did you ever think that you would be so integral in making some of these providers' dreams come true?

Casey Lear:

When I first started out, I was working on larger projects and there were just so many people involved. Even though I was on site every day, it felt like, me personally, almost just got lost in the shuffle a little bit. You're building something for a client, and yes, maybe the client, maybe they know my name, but we really didn't have that relationship that I can have now with all of our clients. That's a little bit more one on one.

Casey Lear:

Again, like I said, we have direct contact with each other. Throughout the project, we collect progress photos so I can see that progression. From start to finish, I can see their excitement build, and really at the end of the day when it all comes together, everything's done and they're ready start seeing patients and you can see the excitement on their face and hear it in their voice, it's just very rewarding to be a part of that.

Corey Brown:

Yeah. That's fantastic. Let me ask, with all your years of experience, especially now in the practice ownership journey, if you could give our listeners one piece of advice when starting a remodel project, what would that be?

Casey Lear:

I think I would say, like I mentioned before, if you're starting to think about that remodel, reach out to any either a design professional or equipment professional in your area. They have the contacts to help put a team together with the client's assistance. The equipment professionals have a lot of contacts, they understand the industry, they understand the flow of the practice, and along with some design professionals.

Casey Lear:

There are definitely some dental and vet specific contractors out there. I think that goes a long way in helping a successful project. Not necessarily absolutely necessary, but if there is someone in your area that specializes in that kind of thing, I think that's definitely helpful. But again, just engaging in a team and reaching out to those professionals in your area, that's definitely a good start.

Corey Brown:

That's great advice, Casey. I want to thank you for taking the time to be here with us today. It was really insightful and detailed look on the construction side of a remodel. I just thank you for being here and being a part of it.

Casey Lear:

Well, again, thanks for having me. Definitely appreciate it.

Corey Brown:

So far, we've discussed the construction side of a remodel project. When we return, Provide's regional director of practice finance in California, Jason Schneller, will join us to discuss the cost of renovating a practice and how to secure a project loan. I'm Corey Brown, and this is Provide's The Path to Owning It podcast, and we're talking today to Jason Schneller, regional director of practice finance in California with a focus on projects about the cost of renovating a practice and how to secure a project loan.

Corey Brown:

Jason spent six and a half years as the vice president, business development manager at Wells Fargo practice finance, and he's been with Provide for almost four years now and resides near Los Angeles, California. Jason, happy to have you on the show today. Thank you so much for being here.

Jason Schneller:

Yeah. Thanks, Corey. Congratulations on the launch of the podcast. Super exciting. This is something I've always thought we should do, and I think it's a great idea. Our team has so much to share, the COIs that we do business with. There's a lot of information to share. This is awesome. Congratulations.

Corey Brown:

Thank you for that. We're super excited about it too. Why don't we start with you though? Can you tell us a little bit more about your career and how you got to where you are now with Provide?

Jason Schneller:

I've been in the industry about 21 years now, lending money to the doctors to help them acquire proper loans to equip their offices, expand, remodel, startup. The way I started was I was living back in Boston and I was working in a completely different industry at the time. I was in a sales support role in the media industry, and I really just wasn't happy with that role and I was looking for something different.

Jason Schneller:

I had heard about a company called HPSC at the time. They were an equipment lender specifically for the dental industry. I started with them back in 2001 in a sales support role. I wasn't sure if that was the right move, but what happened was I ended up loving the company, loving the industry, and here I am, 21 years later, essentially doing the same thing. I came over here to Provide about four or five years ago, really looking to work for a more innovative lender where I can deliver a much better user experience to my clients.

Corey Brown:

Yeah, that's fantastic. Now, Jason, tell us a little bit about how you feel like you've grown in your career alongside with Provide. 

Jason Schneller:

Like I said, when I first started my career, I was really focused on equipment-only loans. Those were very simple, not very complex transactions. Over those years, I started working on more complex deals. I was working at a big box bank prior to being over here at Provide. At the time, we were known as Lendeavor, and I kept hearing about them in the market and I got to know their leadership team a bit. It seemed like they had great plans and they were putting together great programs and products for doctors, and I decided to make the move.

Jason Schneller:

My wife thought I was completely crazy, but I jumped from a big bank to a much smaller FinTech lender. But over those last several years I've been here, it's proven to be my greatest career decision I've made. Doctors absolutely love our fully organized online approach, the ease of the application process, closing and through funding. I think that's why a lot of doctors choose to work with us and why a lot of industry partners do choose to refer business to us.

Corey Brown:

Yeah. I think that's a huge part and you nailed it. Let's talk about the cost of remodel projects a little bit. Do you think it's worth the cost to remodel or renovate?

Jason Schneller:

If a project is properly planned and executed, then I would absolutely say it is worth the cost. Okay? The reason why I say that is a well-designed space is going to allow our providers to maximize their space for better patient flow, more office capacity. We see a lot of doctors who want to do these kind of renovations. Maybe they're looking to add more exam rooms or operatories, or maybe they have plans to bring on associate doctors and they just need more space and more capacity.

Jason Schneller:

A well-designed office can certainly help achieve that. The other thing a well-designed space can do is it can provide a more efficient, more ergonomic working space for employees and the doctors themselves, which can also lead to better production. A well-designed office can provide appeal to patients and even attract new patients, and then a well remodeled office can also help retain and attract new employees as well.

Jason Schneller:

If the employees are happy with their work environment, they're likely to be more productive. Yeah. A lot of times renovations will include investments in equipment as well, and when doctors are investing in new equipment and technology, that does create efficiencies for the office as well. Older equipment is not as efficient as some of the newer models out there, and as advances are made in technology, equipment is able to work faster and smarter.

Jason Schneller:

The right equipment can also allow practice to perform more procedures, which can help bring in more revenue, profit centers for the business. State-of-art equipment too can attract new patients as well, just like a good office design. New equipment can be marketed and attract new patient base. Then also, when you're working with the best and latest technology, you're able to provide the best patient care possible.

Jason Schneller:

When you have the latest technology at your disposal, you can be sure that you're giving your patients access to the best treatment options as well. I do think it's worth the investment to go through a remodel, again, if it's well-planned and well-executed and you're making the right investments.

Corey Brown:

Absolutely. From my time in a dentist practice, you hear a lot of complaints from some staff members when they're using old equipment and things aren't working correctly and it frustrates them, and I think that providers need to think about that when they're considering these investments, because it really, like you said, makes a big difference with the staff too.

Jason Schneller:

Yeah. I think a good first step is really assessing what you want and need for your practice. When you're going through a good plan, it allows you time to just figure out the features that you truly want. It also helps you set realistic expectation on what's possible. For example, maybe you don't want to invest a ton of money in a full redesign. Maybe you just want to invest a small amount of money to modernize the practice.

Jason Schneller:

Maybe some new paint, new floors, new signage, maybe some new technology, but no major structural changes to the actual space. Right? Maybe that's all the renovation would involve. But sometimes a doctor is not happy with their current design. We often see this with doctors that acquire their first practice, right? A lot of times they're acquiring these practices and their good practices for the goodwill and the patient base. But once they settle in after a few years, sometimes these practices do have dated equipment. Doctors want to modernize it and make it more of their own.

Jason Schneller:

In many cases, after a few years, we may see a doctor want to make a significant investment into a renovation or remodel. But my advice, again, talking to other industry professionals is very important for a provider to put themselves in their patient shoes, put themselves in their employees to determine what they see when they come into your office, right? Do they walk into your office and immediately feel like I can tell this office hasn't been remodeled in 20 to 30 years? What kind of message does that send to your patient base?

Corey Brown:

Yeah, definitely. Again, from my time working in the dental industry, we had a thing called the ugly list that we would go around and look at each room and try to look at it from the perspective of the patient and not the employee that sees it every day, and then just slowly start to work on that list. That was at least one of our strategies.

Jason Schneller:

Yeah. I think that's a great idea. Make a checklist, check it annually.

Corey Brown:

When you do have those providers that have a tighter budget that they're working with, what are some of the things that you would recommend that they invest in that would give them the biggest bang for their buck?

Jason Schneller:

Interior decorating styles and technology trends tend to make shifts with the decades. I hear consultants say and other advisors say that a practice should have a facelift about every seven to 10 years, maybe. Again, if you're not looking to invest a ton of money, I'd say new paint, new floors, maybe some upgrades and more affordable equipment is a good place to invest the money to give the office a simple remodel to make it feel more modern.

Jason Schneller:

We're working with a lot of younger doctors right now, and what has changed over my time in the 20 years I've been doing this is the offices today, some of these startup offices, they're pretty amazing designs. These are beautiful offices. They're coming into the market, they're doing things that, again, when I first started, we didn't really see doctors building offices or designing offices like this.

Jason Schneller:

Sometimes, again, if it's a more established office and there's not a ton of money to invest maybe in some artwork, in some new paint, new flooring, just to make the office feel a bit more modern, can be a good way to invest a small amount of money.

Corey Brown:

What would you say that Provide offers practice owners to help them with that remodel and renovation for their practice?

Jason Schneller:

When it comes to office renovations and remodels, there's really three loan options that we offer, right? Our project loan, our practice equity loan, and then our equipment-only loan. Okay? I'll walk through each one of those. But our project loan is really our most popular program. This is really for renovations and remodels that are maybe more complex, more complicated, that require more of a project manager role, like Casey, to help doctors coordinate the funds, make sure that things are on time and that the project is progressing.

Jason Schneller:

With the project loan, there's really two phases to it. The first phase is what we call the construction period or the project period. With a project loan, what we do is we approve the doctor for the funds, we set that money aside and then Casey's team works very closely with the doctor to coordinate funds out to the various lenders. Or vendors rather. During this project phase, no payments are due. For example, let's say we approve a doctor for $600,000 for a renovation project.

Jason Schneller:

During the construction phase, money's going out, but doctors are not required to make full payments to us during that period of time. What happens is at the end of the project, once we get the call from the doctor to say, "All right, everything's fully constructed, the equipment is being installed," at that point what we'll do is we'll tally up what's been spent, we'll tally up what's still pending and we'll come up with the final total.

Jason Schneller:

The beauty of the project loan is if we approve you for 600,000, but at the end of the day, all you need is 524,000, then that's what the loan will term out, and that's what your payment will be based on. It allows us to control the budget and put you in a position where you're not required to make payments until the project's actually done. The other option that we offer is a practice equity. I like to offer this program on maybe the simpler projects where there's not major construction, maybe not a lot of vendors to pay.

Jason Schneller:

The way practice equity works is as practices increase in value, as debts get paid down, practices appreciate and build equity. Very similar to how a home would appreciate, right? Doctors can use this equity, pull cash out, and we can wire that to a doctor's bank account. Essentially, the doctor self funds their project. With the equity loan, there is no project phase. As soon as that money is received, the payment schedule starts. But it's a nice way just to get some cash out on some of the simpler projects that we work on.

Corey Brown:

Jason, that's a really unique product in the industry, correct?

Jason Schneller:

That is a very unique product to provide. Yeah. Again, I've worked for a handful of lenders over the years. This is really the first time I've had an equity program like that that can be utilized that way.

Corey Brown:

Then the third type you had mentioned was the equipment-only loan?

Jason Schneller:

Yeah. The third type of loan that we may use for a renovation is equipment-only. If it's a lease space, sometimes we do see landlords cover the construction, right? Doctors may not need to borrow construction money from us, or doctors have the means to fund their own project and they pay cash. Right? In that case, they may utilize us just for the equipment-only program. It's a very simple application. App only, very streamline approval. But in this case we're only funding the equipment, we're not doing any construction costs or anything other than the equipment only.

Corey Brown:

When a provider is ready and they've decided they're ready to remodel, how would they know which type of loan product would be best for them? What do you recommend they do?

Jason Schneller:

That's what we are here for, really to help guide them. The first step of the process, what I like to do is just get on the phone, understand the nuances and details of what they're looking to accomplish, and guide them. Overview the options that we have, see what makes sense for their business and then come up with a plan and deliver the appropriate product based on that conversation.

Corey Brown:

That's great. Jason, thank you so much for your time today. That was some fantastic insight into what we need to think of or providers need to think of when they're ready to remodel. We really appreciate it. We'll talk to you soon.

Jason Schneller:

Great. Thank you.

Corey Brown:

It was great to hear from these industry experts today and learn more about the importance of remodeling a healthcare practice. Casey, Jason, thank you both for your valuable information, and I hope to have you on again sometime in the future. Thank you for joining us for this episode of The Path to Owning It. If you're ready to take your practice ownership dreams into your own hands, be sure to visit getprovide.com to pre-qualify and browse our practice marketplace, or check out our news page for more helpful resources.

Corey Brown:

The Path to Owning It is brought to you by the team at Provide with production assistance from Sarah Parkey, Tiara Thomas, Jessica Armbruster, and Liv Cannaughton, and it's produced by Podcamp Media, branded podcast production for businesses, podcampmedia.com. Producer, Dusty Weis. Editor, Larry Kilgore III. For Provide, I'm Corey Brown. Thanks for being on the journey with us.

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