The Group Dentistry Now Show: The Voice Of The DSO Industry – Episode 149

USOSM’s leaders join the Group Dentistry Now Show to share their story. Richard Hall, CEO, Henry Moomaw, CFO and Alisa Ulrey, COO discuss:

• What is an MSO?
• Why oral surgery platforms have become prevalent.
• What are the advantages of partnering with an MSO?
• Where do referrals come from?
• Why would an oral surgeon want to work for an oral surgery platform vs. a multi-specialty group?
• Their center of excellence
• What’s next for USOSM?

To find out more about US Oral Surgery Management you can visit https://www.usosm.com/

Thank you to Garfield Refining for sponsoring this podcast. To discover more about Garfield Refining visit https://garfieldrefining.com/dso

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Full Transcript:

Garfield Refining is the dental refining authority for DSOs. Whether a top 10 powerhouse or just emerging, Garfield promises results with its white-glove revenue-driving program used by more than 75 companies in North America. Visit garfieldrefining.com/DSO to connect with their experienced DSO team and start getting results for your group.

Bill Neumann:

Welcome everyone to the Group Dentistry Now show. I’m Bill Neumann and we appreciate everybody watching us, whether it’s on YouTube or maybe you happen to be just listening in, but without a supportive audience like you, we wouldn’t get great guests. We always seem to outdo the last one that we did previously, so we are getting better and better guests. Not to say the ones that at the beginning were good, but I’ll tell you, we’ve got some rock stars on today and it was a bit of a challenge getting all their calendars lined up here. So I think we’ve been working on this one, I’m going to say for six months now. I don’t think that’s an exaggeration. Maybe it’s five months, but we’ve been working on getting everybody together here. So we have the team at US Oral Surgery Management on today to really talk about their platform, what they’re doing, why it’s unique, the future of what they’re doing, and then also the future of the industry as a whole.

Because there’s a lot going on right now and the industry looks a lot different, I think now in late 2023 than it did even six months ago, certainly a year ago. So we’re going to get their insights and why they’re successful. And the audience I would say think about what they’re doing at their organization and maybe be able to take some of those tips and use those in your groups. Or if you happen to be an oral surgeon and you’re listening in, you may be interested in partnering up with the US Oral Surgery Management. So we have Alisa Ulrey here. She is the COO, and we also have Henry Moomaw. He is the CFO, and we have Rick Hall, who is the president and CEO of US Oral Surgery Management. So thank you all for being here today.

Henry Moomaw:

Thank you, Bill. Nice to be with you.

Alisa Ulrey:

Nice to be here. Thank you.

Bill Neumann:

Good. Well, Alisa, why don’t we start with you. Can you tell the audience a little bit about your background prior to joining USOSM?

Alisa Ulrey:

Yeah. I’m happy to do that. Excited to be here today. So yeah, I’m the Chief Operations Officer. I’ve been at US Oral Surgery for almost a year now. I come to US Oral Surgery from years in multi-unit operations at two very large organizations. The first one was CVS Health where I was a division vice president and pharmacy and MinuteClinic operations. And then before that I was division vice president of operations for Target Corporation and had many different roles and responsibilities within both of those companies. And I think those roles really provided me with a really comprehensive understanding of operations and I really am excited to be here and to have been here for a year to help support growing and building our operations while also foundationally supporting our surgeons and partners in their practices as well.

Bill Neumann:

Thanks, Alisa. Henry, let’s talk a little bit about your background. You’re the CFO at USOSM?

Henry Moomaw:

Absolutely. Thank you. Yeah. My background it’s been the world of public accounting, I’m a CPA and spent initially my career with a couple of public companies and 25 years ago joined the exciting world of private equity. US Oral represents my fourth backed company that I’ve worked for all of them either in the healthcare or energy sector. And I’m now with my ninth PE firm and it encompasses six recaps, IPOs are outright sales, and I’ve now been with the US Oral Surgery for coming up on four years.

Bill Neumann:

Thanks, Henry. Rick Hall, president and CEO. Tell us a little bit about what were you doing before you joined the team at US Oral Surgery Management? And you’ve been around since the beginning, 2017, I believe.

Richard J. Hall:

Yeah. I joined right after our first two practices were signed, Bill, in Austin and North Dallas. So yeah, I’ve been in healthcare services for 40 plus years now. The last 25 years have been in private equity, so very similar to Henry’s background. This is my ninth role in a private equity backed business or venture backed business. And I think I’ve worked with 13 different private equity firms at this point. Prior to US Oral surgery, I was the CEO of Oncology Services International, which is the largest provider of radiation therapy services around the world.

And prior to that, I did a number of roles, president of Alliance Oncology and senior vice president of business development and physician recruiting at US Oncology. So that’s where I really cut my teeth on the physician practice management space and found that I liked it a lot and it seemed to be a good match for me. So I continued to pursue business models like that.

Bill Neumann:

Founded in late November 2017, one of the first oral surgery platforms out there. And you call it a first company of its kind. So I want to get some detail on that because if we look back a lot of questions here. I’ve got a list of questions for you. This is really interesting because I think there’s always been specialty DSOs, but I think in particular in the past four or five years, we’ve seen an explosion of oral surgery platforms. So we’ll talk a little bit about that and then why US Oral Surgery is different, but who would like to give me the genesis of US Oral Surgery Management, maybe started November 2017 and then where you are today?

Richard J. Hall:

Yeah. It actually started a little bit before 2017. Pat Haynes from the Thurston Group, who was one of the founders of Smile Doctors and has also been involved in a number of other dental DSO platforms, saw that there really wasn’t anything happening within the oral surgery space after he founded Smile Doctors. So he began to develop a business model and a thesis around oral surgery and began to have early conversations with surgeons that he felt were leaders in the specialty as early, I think as 2016 or maybe even late 2015. And that ultimately led to us partnering with our first two practices, Austin Oral Surgery and Oral Surgery Associates in North Texas in November of 2017.

I came on board about 60 days later in early 2018 as the CEO, I think I was employee number three at the time, and we began to form up the team, the infrastructure, and begin to expand the group. Starting with those two practices in Texas almost six years later now, I think we’re approaching 250 surgeon partners, 90 plus practices, and about 210 or so practicing locations. So pretty rapid growth over the last six year period. Combination of what you would typically find in a model like ours, which is a heavy M&A focus as well as organic growth focus as well. And that’s how we’ve grown to the company that we are today.

Bill Neumann:

I’ve got a question regarding, so you consider yourselves an MSO, a specialty management service organization. So I guess MSO is management service organization. For people in the audience because we’ve got a variety of listeners and people that watch us, oral surgeons that have their own practices or small groups. We have other DSOs out there that maybe aren’t in the oral surgery space or specialty. They might be multi-specialty. So what is the difference between a DSO and an MSO?

Richard J. Hall:

Yeah. I think that’s a good question. I’m not sure I would draw a huge distinction between the two. From our perspective, a management services organization in our model, the surgeons are actually the owners of US Oral Surgery. They’re the majority owners, so they have a very significant equity stake in the business. And we approach our business on a day-to-day basis as though we work for the surgeons and their practices. We provide them with management services and support services primarily on the administrative side of the business. We really focus on giving them ultimate control over their clinical decision making. We don’t interfere with that at all. So we see ourselves as a management partner for the oral surgeons that we partner with, and that’s the orientation that we bring to the relationship and into the delivery of our services that we provide to them.

Bill Neumann:

We touched on it a little bit earlier during the introduction, but we really have seen this incredible growth in specialty DSOs or management companies in the past four years. I think a lot of it started right around COVID or right after COVID seemed to be a real heavy focus investor interest in oral surgery and endodontics, probably partly because those were the emerging care. They were the only things open in some states for two or three months. The only thing that a dentist could do or a surgeon could do. Why do you think we’ve seen such growth in the past four, five years in specialty? And then why, and maybe Rick, you were touching on it earlier, why is US Oral Surgery management different than some of the other platforms? And Henry or Alisa, if you want to answer that.

Henry Moomaw:

You bet I’ll jump in. Just I think a key point you may during COVID, we were shut down from the middle of March into the summer in almost all of the states where we were at the time. And what made our industry particularly resilient and popular at that point was the rebound effect. Those customers that have acute issues continued as soon as things reopened up in various states, late summer into the fall of 2020, that business came roaring back. We ended up achieving our budget for 2020. No one would’ve thought that possible in the early months, March, April and May of COVID. Our surgeons were supported by us, you mentioned the whole MSO concept. And the key there is they’re surgeons. They’re traded surgeons. They do a phenomenal job. They’re at the top level of the sector as oral surgeons doing things like payroll collections, HR functions, that’s the additive value we give them where they can focus on what they do best in seeing patients.

Alisa Ulrey:

And I’ll add to that why we’re differentiated in that space is that we are truly surgeon centric and oral surgeon based. And we believe that that networking across all of our partner practices where our oral surgeons get to work together, we are able to provide insights, oversight, and support from a process standpoint on the administrative side so they can truly maximize and take the opportunity to take those patient care initiatives and really focus on the things that are really important. And because we’re focused solely in oral surgery, that helps us to be able to maximize what we can be able to provide for them, be industry leading in what we do, as well as provide avenues for idea generation and innovation and growth for the future. So I think throughout the pandemic and then through today, how we’ve leaned on each other, learned from each other, and then provided that intel back to our partners, really helps us to be able to set us apart.

Richard J. Hall:

And I think Bill, if you look at the specialty space, particularly oral surgery, the investor community looks at it as a really strong investment opportunity. It has a little bit better risk profile than maybe some other sectors within dentistry. There are high margins typically in these practices. There’s certainly high demand coming from two large demographic areas. The aging population as it relates to implantology and orthognathic care, and then also the younger portion of the generation needing wisdom teeth or other corrective procedures done.

The total addressable market, I think exceeds somewhere around 21 billion in potential business opportunity in the specialty. There’s a big consolidation opportunity in that most oral surgery practices are one or two surgeon practices. It’s a specialty that has not consolidated on its own, so very fragmented. There’s very low government subsidized care. In oral surgery, we’re typically running less than 6% of our total total revenue in either Medicare or Medicaid. Receivables, most of it is cash or private insurance. That’s more attractive from an investor perspective. And as a result, it’s gotten a lot of attention from investors who are looking to invest their money in healthcare, but in a lower risk profile business and oral surgery offers that.

In addition to those investment drivers. Henry mentioned this, when you look at the DNA of an oral surgeon, they’ve been high achievers most of their life. They have to finish very high in their dental school class to even be offered a residency in oral surgery. They’re unique in that most of them are dual degreed, both having a DDS and an MD. So they’re self-starters. They’re highly motivated, they’re competitive, and as a result of that, they make great business partners to have on the clinical delivery side while we offer support on the business side.

Bill Neumann:

So let’s talk a little bit about advantages to partnering with an MSO. If I am an oral surgeon or maybe I have one location, or maybe I have a couple of practices and I’m doing things on my own, why would I want to join an MSO? What’s attractive about that?

Alisa Ulrey:

Yeah. I’ll take that one.

Richard J. Hall:

Go ahead, Alisa.

Alisa Ulrey:

Sorry. I’ll start and then my counterparts can also finish. So what I would say is first and foremost for us, we believe that though our oral surgeons have complete clinical autonomy, I think that’s extraordinarily important as we think about joining an MSL, you want to ensure that as a oral surgeon, you feel like you have the ability and the decision-making to ensure that you have the autonomy to do what’s right for your patients. So that’s really important. That sets us apart. I would also say from the administrative side and the operations side, what we really focus on is taking those nonclinical administrative support services and really help to be able to take that burden away so that they operate effectively. So from the billings and collections, the administrative side of marketing, the work that we do assist you do with staffing, hiring, insurance claim, payroll, all of those things, taking that and building our processes to be able to support them to do and deliver on their patient care is really important.

And I think the other advantage that we have, if you think about it from a financial standpoint, we have the group purchasing power. So you think about supplies and reducing expenses. As you join an MSO and as we have the economies of scale, the ability to support them not only through the administrative size but also the financial side is important. And then finally, anything we can do to help support practice expansions and thinking about new out and new de novos is something we can also help these partners with if that’s something that they’re interested in.

Henry Moomaw:

And I’ll add up to Alisa’s comments, particularly with the younger surgeons. It’s the mentorship that they go off on their own. They will get the mentorship that our surgeons can offer. And along with that, there’s some financial opportunities. We have a student loan repayment program that we offer the associates coming out of medical school. We’ve got an equity assistance program, an equity loan program that can be set up with as well. With the level of student loans that many of them have. Obviously investing cash and becoming an equity owner in our company, tremendous opportunity they normally would not have. So we’ve been able to establish a relationship with the bank and offer them a loan program where they can partake in the equity just like our surgeon partners. And it’s an expedited path at the practice in which they join. Normally that path to becoming a partner in that practice is a one to two year path.

Richard J. Hall:

Yeah. I think when we think of our value proposition, Bill, to a oral surgery practice, I think we think of it in three pillars, if you will. Pillar number one is what Alisa talked about in more lifestyle driven, relieving them of the burden associated with the administrative responsibilities that they have as an entrepreneurial surgeon, both doing the clinical responsibilities on a day-to-day basis, as well as all the business responsibilities with their staff. The second one Henry touched on it is a wealth creation opportunity by involving them in a private equity model that they typically would not have had access to otherwise. And we always look at it as transferring ownership in a small, independent private practice into a percentage of ownership in a much larger entity. And that percentage in the much larger entity can become much more valuable than a hundred percent ownership in their independent private practice.

And then the third piece is, as I mentioned earlier, most of these surgeons practice in one or two surgeon practices. They are very isolated from their colleagues, their heads down every day trying to develop or deliver the best quality of care that they can, but they’re on an island isolated on their own. And what we found after partnering with a few of them early on is they really appreciated the sense of community, the sense of belonging to something else that they were part owners in collectively with their respected colleagues. And then the opportunity to really share best practices among that shared base to improve the overall operations collectively for the group. That’s something that they really had not had access to earlier.

So we always convey to our partners that now with over 200 sites of service, we learn something good and bad probably from each one of them. And we try to take the good things that we learn and transfer that to the other practices and ask them if they would like to consider employing some of those processes that we found helpful to their colleagues. So that’s the value that I think that they see in an organization like ours.

Bill Neumann:

One of the questions I’ve always had is where are the referrals coming from? Are they coming from other DSOs or emerging dental groups or are they coming from private practitioners?

Richard J. Hall:

Alisa, you want to take that?

Alisa Ulrey:

Yeah, of course. Yeah. They’re coming from multiple areas. We see referrals coming from the general dentist that look for procedures that are specialized around tooth extractions and dental implant placement, which Rick talked about a minute ago. We also see referrals that are coming from orthodontist, periodontist, other specialties They come our way because we truly have the best of the best and the most experience when it comes to oral surgery. We also really believe that that word of mouth is very powerful, and having someone who has the experience and the understanding and the specialty in this space becomes really important as those referral groups, they talk about the experience that they get with our surgeons. That word of mouth also transitions into referrals coming in. We also work on our marketing strategies that help support those surgeons both online and in local communities. So we get a wide variety of referral sources across many different platforms, and we help to support our partners when needed. And in those specialty groups as well too.

Bill Neumann:

There’s a lot of different opportunities out there for oral surgeons, whether it’s they are oral surgeons coming out of medical school or whether they have their own practice looking for a transition opportunity or a partner. So why would an oral surgeon want to work for or partner with US Oral Surgery management versus maybe a multispecialty DSO? There’s some major differences there. So can you talk about why an oral surgeon would want to partner with you versus maybe look at somebody that is more multispecialty?

Richard J. Hall:

Yeah. I guess there’s a number of things that we believe in, at least, Bill, from our perspective, clearly we are 100% myopically focused on oral surgery, and we believe that is incredibly important in the delivery of our value proposition. We believe that by being the experts in oral surgery from a business management perspective, we’re going to get better and better and better as time goes on, as opposed to distracting ourselves with other specialties. The other thing that we’ve done from day one is we invested in the infrastructure, people, processes, and systems from the very beginning. So going back to our first budget year of 2018, we invested an excess of $15 million that year and every subsequent year. This year, we’re actually going to invest over $40 million. So over the course of our six year existence, we’ve now invested well over $120 million worth of capital in people processes and systems.

And that was a model that we subscribed to early on because we felt it was important to be able to deliver on our value proposition around these multiple business services that we deliver every day to our practice partners. And I think the other thing is when you look at the capital structure of the business today, as you mentioned, there’s been a proliferation of new companies entering the market over the last three or four year period of time. The cost of capital has more than doubled in the last 18 months, and some of those companies find themselves in a difficult position from a balance sheet perspective.

We’re fortunate in that we feel like we’re one of the best, if not the best capitalized businesses in the industry today. We’ve gone through one successful recapitalization event with exceptionally strong surgeon support. And now that our surgeon partners are majority owners in our business, this is truly a physician owned and led organization. Even though we have business people in key leadership positions within the company such as myself and Alisa and Henry and others on our team, we also have strong surgeon leadership. We have two surgeons on our board of directors. We have a clinical governance board consisting of about 16 surgeons that are on a rotating tenure basis in that governing body.

And then we have about 10 freestanding surgeon committees that focus on key functional areas of the business. And we’re on key projects so that we always ensure that we have surgeon input in all the major decisions that we make regarding the direction of the company going forward. I think that’s what has really differentiated us. While there’s been a proliferation of companies in our specialty, not all of us are created equal and we remain focused on oral surgery.

We think that diversifying into a multispecialty practice also has some risks associated. And I can tell you that what we’ve built here over the last six years is not easy. And when you do that over multispecialists, it even becomes more complex. So as an example, today we support four different practice management systems. In a multispecialty organization if they didn’t standardize on one, they may be trying to support as many as 20 different practice management systems. There is executional risk associated with that type of diversification.

The other thing as we’re seeing today in the market is when you move into a multi-specialty platform, the performance of the organization is an aggregation of all those specialty. And if one specialty in particular, such as orthodontia currently being a little bit under pressure, that can create a drag on the rest of the organization’s performance. So we like being the experts in one specialty and getting better at that every day. We like the focus that provides us as it relates to execution. And then we also like that we’re in control to some degree of our own destiny in that we don’t rely on other specialties to help drive our performance.

Henry Moomaw:

And Rick, I’d add also the first mover advantage we have over the others is we were able to partner with what we fervently believe are the best surgeons in the oral surgery sector. Starting in Austin into Dallas, across to Atlanta, up to Minneapolis, St. Paul, and down to Denver with some of our first partnerships. They’re industry leaders, industry icons, they lead state and national societies. They’re the top of the industry revered by other surgeons, and it’s a big player in why we’re able to attract additional practices and surgeons to partner with us.

Alisa Ulrey:

And I’ll just add the last thing I touched on a minute ago is the complete clinical autonomy, I think that’s really important for those looking to get in MSO, especially designed around oral surgery, is to have that autonomy. Our role and our goal is to help support our partners be able to take care of their patients and perform at their very highest level while we take the administrative burdens and the things behind the scenes away, but giving them that complete clinical autonomy we believe is really important to continue to foster.

Bill Neumann:

So you’ve had a lot of success in a relatively short period of time, and you’ve also been pretty successful with credit expansion. So in 2022, you had looks like $125 million in 2023, $150 million. Sounds like a lot of that is invested back into the business with the systems that you’re creating to support the surgeons. So I know that you’ve touched on certain secrets to your success, not so secret now, but anything else that we might be missing? Because as Rick pointed out, it may in retrospect sound relatively easy, but certainly is not. And for the people that are looking, the surgeons looking to partner or just other groups out there that are trying to scale up now in a certainly challenging environment, what else can you say? Again, you’ve given reasons why they should partner, but what other things do you think are part of that success that you’ve had and why you’ve had it?

Richard J. Hall:

I think part of it, Bill, is the culture that we tried to create from the very beginning. If you look at almost every company’s website out there, they’ll all say that they’re surgeon centric and hopefully they are. But that manifests itself on a daily basis different ways, and starting with servant leadership at the top and then developing the team throughout the organization that truly believes every day is spent helping the surgeon deliver the best care that they can and creating the best patient experience that we can with our team members is what we’re really, really focused on. And I think that’s a differentiator. And when we look at other differentiating factors, how you separate yourself from the pack. I think overall performance in today’s market, particularly organic growth, many of these platforms, ourselves included, were heavy on M&A. And now with the cost of capital, we’re in a differentiated position, we believe with our capital structure and our balance sheet.

But clearly even with that differentiated position and dry powder to continue to do a strong M&A function, we want to grow faster than our competition and faster than the market. So organic growth in the high single digits is what differentiates the truly great platforms from the average platforms. How we do that is, thank God we have the infrastructure that we need to do that, but we’re going to continue to invest in that heavily. As we went through the budgeting process this year for 2024, heavy investment in systems, heavy investment in additional infrastructure, we’re taking a hard look at additional technology platforms that can make some of our processes more efficient, moving them from manual processes for rudimentary processes to utilize more technology. Obviously artificial intelligence is something that we have our IT group highly focused on trying to identify AI that could be effectively deployed in our operations on a day-to-day basis.

What our primary focus is now is everything that we do has to be focused on how we create more clinical time for the surgeon so that they can focus on quality delivery and patient outcomes. Dentistry as trails general healthcare by some say as much as a decade or more with regard to quality measurements. And because of that and because of our leadership position in oral surgery, we want to be seen as the leader on quality. So we’re putting things in place to measure quality, report quality and try to differentiate ourselves in that regard as well because we think it’s going to be critically important to our referral sources and to our patients as they become more knowledgeable about how oral health is an incredibly important component of your overall health.

Bill Neumann:

So at the top of the show, we talked a little bit about USOSM being the first company of its kind. What was the driver to actually get into this specific niche? And in dentistry, because you all come from outside of dentistry and then to focus on oral surgery, you talked about some of the thought process. But any insights as to especially you, Rick, when you started on early, why focus on oral surgery?

Richard J. Hall:

Yeah. I think for me, I certainly liked all the things I talked about earlier from an investment thesis perspective. But I think the thing that really tipped the scale for me, when I did my due diligence and got out and met a number of oral surgeons before I made the decision to join US Oral Surgery, I became very impressed with the quality of the people that I was meeting with and their self-initiating competitive drive. One of the things that can be challenging in these types of business models is you obviously form a valuation thesis for the practice assets and you offer that to the surgeons to become part of the organization. And most of that value in dentistry is the goodwill represented by the production that the clinical provider drives on a day-to-day basis. And one of the potholes, I guess, if you will in this type of model is if you move forward thinking your goodwill is at one level and then shortly thereafter it’s at another, you essentially have overpaid or overvalued that practice and no one benefits from that long-term in returns.

And the one thing that I was really impressed with meeting oral surgeons is I don’t think you have to tell them what they need to do to work. They’re hardworking people, they love what they do, they have a passion for oral surgery, they want to be in the office delivering high quality care. And as a result of that, I thought that coupled with our business model of having them be equity owners in the business and us relieving them of that administrative burden associated with running their own practice was just a winning combination. So I got really excited about the opportunity and six years into it, I’m still very excited about it.

Bill Neumann:

So let’s pivot a little bit here. We’re getting towards the end of the podcast. You announced relatively recently that you have this centers of excellence program. So can you talk a little bit about what that is and why you feel it’s so important to the organization?

Richard J. Hall:

Alisa, you want to take that?

Alisa Ulrey:

Yeah. I can go ahead and start. So we’ve talked about the centers of excellence and really wanted to build a program that recognizes our USOSM partner practices who consistently deliver superior patient care and clinical excellence and really encouraging these characteristics in our other practices and continue to spur growth along the way. We really wanted to identify different areas in which we could differentiate even within our own practices. So we’ve looked at things around clinical excellence, what our patient excellence scores are, looking at things from an operational perspective, how are we performing and running from the day in and day out business?

And we looked at financial, the OMS community, and we put together a series of opportunities where we look at opportunities for these practices to become accredited by AAAHC, and identify different ways to differentiate and really look at opportunities for our partners to be able to continue to grow. As we’ve all said, we have some of the best of the industry. So we believe by having these centers of excellence, we’ll really be able to continue along that differentiation and support that growth along the way with our practices.

Richard J. Hall:

And again, it is similar to JCO accreditation for hospitals. We felt that we talked about referrals earlier and where they come from, whether they come through a referral source of a general dentist or one of the other specialties or direct to consumer, we felt that a designation of a center of excellence may be meaningful to the patients and to the referral sources. And again, we want to lead the industry in measuring quality. So the centers of excellence is one initiative. We have another initiative being led through our clinical governance board on measuring clinical quality around implantology and implant failures. We’re working hand in hand with some of the implant providers. And we think that’s going to be meaningful.

Anesthesia, collecting as much information as we can about the safety of the administration of our anesthesia on a daily basis in an outpatient setting such as our offices is really important to the specialty. And we want to support Amos and others as they collect information and provide information to legislators and state regulatory agencies around the safety delivery of care. So we’re trying to be a leader in all of those areas. We’ve positioned ourselves that way from the beginning by heavily supporting OMSs Fire and other specialty driven educational efforts for students and residents. And we’re going to continue to do that on a daily basis.

Bill Neumann:

So last question here. Well, two questions technically, but we’ll start with Henry. So what’s next for USOSM? It sounds like things are going really well, but what does 2024 look like? And beyond that, if you can give us a little bit of a window into maybe the financial side of things where you’re going to make investments, and then I’d love to get feedback from each one of you on the operations side and then from you, Rick, but Henry, why don’t you start things off.

Henry Moomaw:

You bet, Bill. As Rick mentioned, we’re six years in at this point. The industry is still only about 11% consolidated. So a lot of continued consolidation opportunity, a lot of opportunity for our M&A team and continuing to grow our existing, Rick mentioned 250 surgeons thereabouts now and continue to grow that a lot of opportunity to improve things we do here at the Practice Support Center in support of those surgeons and to continue to grow the M&A. We’re in 26 states currently and many untouched areas where we have not been able to partner with new surgeons.

We mentioned the credit facility earlier that’s in place that’ll provide us that M&A capital that we need to continue to partner with strong new practices across the United States. And as far as where that takes us, it’s unlimited, 2024 and beyond. Obviously, our current equity backer has been very supportive. Our lenders have been very supportive, and it’s as a result of the strength of the surgeons that make up our platform.

Alisa Ulrey:

I’ll tie into operations, and Rick talk about organic growth and our focus is very much on how do we provide an avenue where we can continue to support our partner practices while also building growth. And we build growth through several things. The first is how are we working on our payer contracting? How are we ensuring that we are being reimbursed appropriately for the work that our surgeons are doing? And really focusing on those contract negotiations to ensure those things happen for our covered services. Really looking at building growth. So we build growth through volume. That volume is how many more referral sources are we working with? How can we think differently about approaching those referral sources through different means? So traditionally our surgeons have been very focused on keeping those referral bases, boots on the ground and keeping those relationships important. That’s critical and essential while thinking about different technologies that we can be using.

Very similar to what we’re doing today, reaching through podcasts, reaching through social media, thinking about digital platforms that help to be able to share the growth, the trajectory and the things that we’re able to provide and to do. Also think about growing volume. How do our patients know about us and how do we continue to grow in that base? I touched on it a minute ago, de novos. I think that’s a really exciting piece for us to be able to expand our platform, to be able to find and identify greenfield locations where we can have surgeons build and grow their practices while also building our patient base and locations that perhaps we haven’t been in before. Or looking at expanding locations and our current partner practices and saying, “Gosh, there’s another opportunity for us to grow this year because the patient demand is far outweighing what we’re able to provide today.”

And then obviously continue our focus on surgeon recruiting, which is incredibly important, the mentorships that we can provide in our depth, in our work in that space, and really helping those surgeons get a match with us to be able to continue to help growth. And then finally, it’s ensuring that we’re doing everything we can on the operation side to be as effective and as efficient and as process driven in support of our partners as they are working on their pursuit of really good quality patient care.

Richard J. Hall:

Yeah. I think the only thing I would add to that, to piggyback a little bit on what Alisa said would be generically leaning into change and leading with innovation and creativity to solve difficult challenges that the industry faces. So two in particular that I think we’re going to be highly focused on is post pandemic, the labor force is much different than it’s ever been, certainly different than any that I have seen in the course of my professional career. And we’re going to have to develop different ways to recruit, train, and retain staff because our surgeons are only as good and as productive as the staff that surround them. So team members support and team member development is going to be a key area of focus for us going forward. And then the surgeon recruitment piece, there’s only 235 or so residents coming out of OMS programs every year.

There’s going to be a much higher demand. I think oral surgery is projected to grow very, very low single digits over the next decade while dentistry in general is growing in the mid-teens based upon the data I’ve seen recently. So the number of referral sources is expanding significantly while the number of oral surgeons that they can refer to is essentially remaining flat. And that means that for companies like ours, we’re going to have to have a world-class recruiting organization and providing a path and a system that will allow young residents to experience the greatest success upon joining one of our partner practices. So mentorship, compensation, clinical training and development, business support and marketing to help them build a successful private practice is going to be a part of our program going forward.

Bill Neumann:

Well, that is all the time we have today, but I think that was a great conversation. Thank you all for being a part of the show. We did a real deep dive on the organization and I think our audience really has a better idea. I know I do of US Oral Surgery Management, where you started and where you’re headed. If someone in the audience would like to find out more about your organization, how do they do so?

Richard J. Hall:

Thank you, Bill. I think the best way would be to, we have a website page where they can contact Lyle Rountree, who’s our Vice President of Marketing. That would be the initial point of contact. And then Lyle can triage the question to the appropriate team member within our organization.

Bill Neumann:

Well, that sounds good. What we’ll do is we’ll drop your URL in the show notes so people know how to reach out to you, find out more about US Oral Surgery Management, Alisa, Rick, Henry, thank you all for being a part of the Group Dentistry Now Show, and thank you everybody for watching us. So until next time, I’m Bill Neumann. Thank you.