This podcast covers from START to FINISH How to Acquire a Dental Practice. Michael Dinsio, founder of Next Level Consultants has literally seen hundreds of deals as a banker in the industry & he has personally consulted hundreds of dentists as a Buyers Representative. Michael talks with GUEST SPEAKERS about Due Diligence, Legal, Demographics, and more... He invites experts to the show to help you avoid those headaches and heartbreaks. So start at the TOP w/ Episode 01 and work your way through the transition process. We break it down step by step in a true #UNSCRIPTED and genuine way.
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Oh yeah, here we go practice acquisition. There are pitfalls throughout the entire process.
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Acquisition Unscripted, the truth when buying and selling at dental practice.
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And now your host, Michael Dinsio. What's up, guys? Thanks for joining another episode here on Dental Acquisition Uncensored. We've got an awesome, awesome program today for you.
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It's all about HR and HR is key, is a key to successful transition. No doubt. Um, we get into lots of nitty gritty stuff. Um, I told Scott and I'll introduce him in a second. told him we got to hit some meat and potatoes, but it's tough for Scott to do that because there's 50 some States, right? Well, 50 States that have different laws and all kinds of stuff. So he can't get really into it, but I did get some stuff out of him and it was.
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Fantastic, and I loved it. Yes, HR is huge. We talk about how to onboard. We talk about how to fire. We talk about the HR manual, how important that is. We talk about the way that they manage the file. We talk about all kinds of stuff, HR related, and I think it's a key episode for you. It's one of the things that gets overlooked in a transition because you've got thousand things.
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You're thinking about credentialing, banking, insurance, the purchase and sale, the lease, mean, everything. And the one thing that's going to cause you the most stress is employees. And this is what, this is the armor that you would wear going into that scenario. Okay. So tune in, I get to some great questions at the end of the episode. So, so hang in there and if you can't pause, pick it up later. No problem.
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You will also see a QR code flashing for you from my YouTube tubers flashing. They provided a transition guide transition guide for you to have as a, as a big gift for yourself.
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Without further ado, let's get this party started. Thanks guys for tuning in and let's go. All right, all right guys. Hey, welcome. This is Dental Unscripted here, breaking it down in acquisition style. Another great episode and a dear friend of mine today is a guest.
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And I'm super excited because as you all know, we're working our way through the acquisition process. you're just getting tuned in to the, to the program, uh, understand what we're doing here. So the goal or the vision of this program is really to walk you through an acquisition from literally start to finish. So if you're just finding us today, go up, scroll up, get to the first episode and
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go through this journey with us together because we are at the, uh, kind of two thirds of the way through an acquisition. Now speaking today topic is HR and, uh, it's a very important topic, but, guys go to the top and start listening all the way through. Because if you were thinking of buying a practice, you gotta, you gotta start from the top and
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little plug of the other podcast called Startup Unscripted. If you're thinking startup, that's the podcast for you. If you're thinking acquisition, this is the podcast for you. And I had HR for Health on the program for Startup Unscripted with the owner and founder, Ali Oromchian , but we already had Ali on this particular program. So I didn't want too, too much Ali.
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Ali helped us with the LOI and how you formulate the LOI. So a little plug for Ali and his legal firm that helps docs get into ownership and helps them with the legal stuff. But then this, this is an entirely different matter. This is HR. And today I have a dear friend of mine who has a lot of history with me, good or bad, we'll keep those stories to ourselves. But...
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the man, the myth, legend, Scott Mueller, who's a senior account executive with HR for Health. And he's our guy. So Scott, Hi! Welcome to the program here. Thank you. Thanks for having me. I appreciate it, Michael. Yeah, this is an important topic, most certainly. And I think you're right. You're probably about two thirds way through navigating through a practice acquisition. And this is definitely a very important.
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Subject is a very important part of the business of dentistry, most certainly. Absolutely. Because most of these buyers have no idea what the hell they're getting into when it comes to managing people. It's the hardest thing. so HR is huge. So Scott, tell us a little bit about HR for Health. Like what you guys are all about. What's your vision? What's what's your, what's your mojo? Because this company, I've met the, the top brass and even some of the middle management and
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phenomenal people that just get it by give us the spiel man not too long though don't yeah yeah so yeah absolutely so and i appreciate you saying that yeah we we are blessed with uh with with a great team here at hr for health it's uh it's a joy to work here um and it's also a joy to to provide the assistance these doctors need uh when they are transitioning practice what do do here at hr for health
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Before I get too much into that, are tasked with helping make these doctors lives much easier so they don't have to worry about their employees. We're peace of mind over here at HR for Health. So really what we do is we help these doctors in the event of a practice acquisition achieve, maintain HR compliance that looks different all over the country. Some states are more difficult than others, but we're also able to provide great support for our clients.
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really great software to help them manage all of their HR processes very, very efficiently and take the guesswork out of really anything, whether it's timekeeping, tracking benefits or managing difficult situations with employees. I think that's kind of a nice high level overview. it's perfect. It's perfect. I'm going to drill you here in a second with some great questions. folks, Scott was a little nervous about the interview, not nervous that he couldn't handle himself, but.
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He wanted to game plan. And I said, there's no game plan on acquisition unscripted. This is an unscripted show. And so if he says something, we absolutely can edit it out, no Scott's a total pro and he's going to be able to handle this interview. It's, it's, it's, but it is unscripted, brother. here we go. one. Okay. Question one. I feel like you're on a game show right now. Question one.
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What do you find with acquisitions in mind? Okay. Keep on that path today is acquisitions focused. Question one, what's the biggest pitfalls you see in buyers approaching that finish line at close as it relates to HR? What's your thoughts there? Well, you know, unfortunately, I work with great people in the industry like you that
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allow me to work with doctors that are transitioning. But I think the best way to answer that question is we don't get to work with every single transition doctor. And so a lot of times we meet these doctors post-closed because they have dealt with some type of issue. They're losing their hygienists. And it's all because they didn't have a strategy in place when it came to transitioning the employees.
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What are that, you know, what is that doctor's policies regarding overtime? What does it mean to be tardy? What is, what do you do with the cell phone? I mean, there's all kinds of things that these doctors try to DIY. So it can be, it can be a real mess and employees want to know, cause a lot of times, as you know, Mike, these are, these are highly confidential transactions and these employees sometimes don't find out about it till day one, right? And all employees want to know is,
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does this doctor, am I employed number one, right? But does the doctor can be able to take care of my needs, the rest of my fellow coworkers needs, but having a plan in place, that's what employees want. Yeah. I couldn't agree more. I feel like this is one of those steps that's totally missed. And I understand why, because I'm in the weeds with these buyers, like all the way from
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Is this the right price to, are they screwing up clinically to the, are they compliant with X-rays and narratives and collections and just on and on and on. And then, and then finally they make this huge decision that they, they want to buy this bad boy. And so then the spigot really turns on credentialing, banking, purchase and sale, lease, insurances, all of these tactical things that have to happen.
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And Scott, you and I worked at Bank of America a long time ago. And so we would walk people through that, you and me, right? And it was, dude, just dealing with the bank was an ass ton of phone calls and emails. So I understand why this HR thing gets overlooked. So I appreciate the, but it, but, uh, it's kind of like, you know,
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prevention, if you all are in clinical world, as we all are, prevention is key. It can prevent a catastrophe. So, yeah. All right. So really they're calling you when there's a major problem, but what are, so that kind of leads us into what could we do better for preventing catastrophes on an acquisition? know that's a super loaded question, but what are some high level, what's some high levels there? Like just basic stuff.
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Top three, maybe. Well, you know, I think number one, just having an HR strategy in place that includes handbook, all the mandatory onboarding documentation and support. You know, these doctors, I hear it all the time, you know, especially when I'm talking to your transition doctors. Most of them have gone, most of them went through COVID. So they have an experience.
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the single biggest HR event probably that will ever happen to practice owner. Let's hope so. We're past that. Right. Yeah, for sure. Thank God. But you know, they all have, they all have perspective. And when I talk to these doctors that are getting ready to purchase practice, we talk about their, their, uh, their experiences over the last couple of years working as an associate in, and they all, they're concerned. A lot of them, once I brought out of them through a consultation, I draw out that
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Yeah, this is a component of the practice that they need to have a handle on and make sure that they're treating employees fairly. A lot of these doctors, though they want to have a solution, they don't really have any sort of specifics as to what they what they want for their HR department other than a handbook and a W-4. Yeah, yeah. No, that's that's spot on. I just did a lecture for some dental students up and over down.
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down and over in Arizona. you know, Arizona is kind of the wild, wild West in a lot of ways. It's very simple. And I appreciate that about Arizona. So that's nice. Unlike Washington or California, where I tend to do a lot of stuff, which is supercharged on the other spectrum, but where I, where I was going with that, and I did a raise of hands like, folks, buying or startup.
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vast majority was acquisition. And then it was, Hey folks, how many of you are going to leave Arizona and go somewhere else? And pretty much all of them, except for maybe two said that they would leave Arizona. And the reason I'm making that comment is because you might be an associate in one state and think you understand the HR laws. And then you go to a place like Washington or California, and it's a whole nother level. So, so.
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That's what you guys can help them understand, not only the laws in their existing state, but also what the state's requiring in HR. Absolutely. Give us some crazy examples of differences between Texas and Arizona and California. Just fun stuff.
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Yeah, you got any of those? got any of those? Yeah, for sure. You know, I think probably the biggest thing and those are good examples of, I would say, two complete opposite ends of the spectrum, Texas and California, right? Texas is a super employer friendly state to be a practice owner in California is is not. No, just not. It's just not. Yeah. And
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And these doctors, know, in the, know, let's talk about everybody knows that California is difficult when it comes to labor compliance. But let's talk about the doctor that that buys a practice in Texas, though it's an employer friendly state, of course, labor compliance laws. But still, it always comes back to that thing. You got to have a plan in place when it comes to your employees. And it's almost as simple as. Putting an offer letter in front of these employees so that they know they're they're hired day one, but.
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That's just, mean, there's all kinds of things that we could talk about. But I would say to answer your question, one of the biggest differences between states like Texas and California are paid sick leave laws. Paid sick leave laws, they're all over California. Some counties are different than other counties. so we just take all the guess. Yeah. know, LA County is calculations different than another county. So we take all that guesswork out with some great technology.
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And it's really about that idea of integrating a time clock with benefit track. So these poor doctors aren't doing these things on spreadsheets and essentially DIYing all the HR processes. Yeah. You've brought tech, your company has brought technology to the HR game at think of legalzoom.com. Right. You know,
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creating a will or something and, uh, and you guys have turned that into, uh, HR. So you make it simple, you make it easy. The software is great to use. Um, and you know, you, you talk about setting up the right way, like HR manual onboarding forms. Um, like just that let's dig in a little bit on that. So just that, you know, what are, what are some things about the onboarding process?
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that you would just kind of hit for these buyers? Sure. Well, the onboarding process is where it all begins. That's the foundation of one of the major components of what we provide practice owners here. Complete HR compliance, regardless of the state that they're in. This includes job descriptions.
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And all the, you know, the transition documents, California in some parts are north of 20, Texas got about 12 or 13 required documents. So required docs. Yeah. Required documents. And, know, having, having a proactive approach allows the employees on the other side to not have, right. Number one, do I have a job? Is my hourly rate of pay changing?
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What's changing at all? Oh, great. I've got this offer letter here that's telling me nothing's changing. I'm employed. And a lot of the time that I'm talking to these doctors, if it's like the first phone call, you know, not a doctor that you that you've referred to me, we talk about the employee experience because you really these doctors sometimes don't think about what does that look like? How does that feel on the other side? And so when we talk through that, they begin to understand more and more of the
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of, yeah, it's probably a good idea to put things in writing. In the fact of the matter, in being in business as long as we have, we've certainly accumulated some great statistics. I mean, these doctors are more likely to retain employees for almost four years by just simply having a proactive approach to HR, but a proper onboarding solution for these employees. I've been in the room naturally as a buyer's rep and practice consultant.
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where there's tears, there's, um, there's a lot of emotions, the team, especially if the seller has been in that practice for a long time. Like it is a very emotional process in it. And it actually sucks that we can't tell them that we're doing this because there's a lot of risk there. And that's a whole episode in itself of why you don't want the sellers to tell the employees or the buyer.
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frankly, to let them know too soon because, yeah, because they, especially in this wild, wild employment market, people are looking for jobs and always trying to level up level up. and so giving them time to do that before you take over is a major risk for you and the seller. So, back to where I was going with that is that like, to me, the tighter you are in HR, the more security you give your team or your new team.
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the new day. And because these are people that are clinical, if you guys don't understand behavior, we do a lot of disc, right? Scott disc and these are high S's high C's. They want a lot of detail. They want it in writing. They want granular. That's what that's the dental assistant hygienist doctor person. They don't want super high level. They want in the weeds. And so the things that you guys provide,
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gives the team the security, like, like you're saying it, but I feel like the buyers don't understand. think that that's just like, yeah, you know, I I'll figure it out. And that creates an unstable situation. Wouldn't you agree? 100%. Yeah. The employees of a practice transition don't want to feel like they're being breezed over with anything to do with their employment in that practice. They must know. And, you know,
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I often get the, I would say it's kind of, kind of an obstacle once in a while. You know, I don't want to, I don't want to do a handbook. I don't want to do all this stuff because I don't want the employees to think I'm trying to turn the place upside down. Yeah. Freak them out because the other guy didn't have it. I hear that all the time. The other guy didn't have it. So I don't want to do it. Well, it's the opposite, bro. It's the opposite.
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It's a completely different world. mean, just, mean, the HR world has changed dramatically in the last couple of years since COVID. You pushing states towards complicated paid sick leave laws and leave law, all kinds of stuff that's going on. Yeah, it's, you know, again, it's always that idea when I'm talking to these doctors about, know, think about what that feels like on the other end.
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Don't you think that makes sense? Don't you think it makes sense to have an offer letter and all the other documents and their job descriptions. it doesn't matter. Like you said, it doesn't matter that the, uh, the other doctor didn't have any of these things. were new practice owner. Now, Scott, you and I have had the conversation, excuse me, that sometimes I feel like, like, I heard this analogy a long time ago. Um, sometimes I feel like with HR,
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dropping a nuke on it when you could have just sent in SEAL Team 6 to get the job done super quick, right? Two strategies. so, you advise them through this, but if you're too crazy about HR and you're probably thinking, there's no way to be too crazy. But at the same time, if the DNA of the practice is super chill and you bring in a
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70 page HR manual, that might be a nuke, but that doesn't mean that you don't need a manual, you need one. And so can we talk about that? Nuclear war versus strategic operation? Yeah, absolutely. And the only way to control the atmosphere
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the employee atmosphere of a practice through the transition. And it's, probably repeating myself too much, but because this is a conversation I have quite often with transition doctors, right? Like I said, a few minutes ago, it's too much. I don't want to do all that, but it's your practice, Dr. Smith. This is your practice. You want to be able to have admission statements. want to be able to have policies in place. And it's also super important since you're in California, Dr. Smith, to
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be an acknowledgement of labor compliance laws. It's required. And I say all the time, if you do anything, I'd love to work with you, Dr. Smith, but if we don't work together, please get a handbook. You've got to have a handbook. And it's not nuclear for these doctors. It's not nuclear for these employees. Employees want to have an understanding of new practice ownership and what that means. Leaving it to guess is terrible. Yeah, but they have control. They have control to do either strategy and
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And that's the great thing is, I think that's where the meat and potatoes are where like, just knocking off your buddy's HR manual, you could really F that up. Um, you could really F that up and, it's customized and you have someone you talked about support. You have someone to bounce stuff off of. Hey, look, I want to be super chill on my manual, but I also need a foundation guys. Can you help me accomplish that? Right. So yes.
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You talk about paid sick. I get paid sick questions all the time. I feel like I'm pretty dialed in with Washington and some of the states that I'm heavy in, but we're in 20 states. I can't keep track of this crap. you just mentioned California is by county. know, Washington States, Washington, Ohio is Ohio, right? But California is by county. So just to make it extra
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crazy pants. So I don't even answer anything. California is like California. Oh, call Scott. I can't. Yes. So, so pay, I get this all the time. Pay a PTO, you know, there's two types of PTO. What are those types of PTO? Because they always get somehow confused. So PTO. Yeah. And actually that, was a perfect visual of what a lot of practice owners do is they lump these two in one bucket.
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And in states like Washington and California, Oregon, Colorado, where there are paid sick leave laws, it's important to keep vacation hours and paid sick leave hours in separate buckets. Bing, bing, bing, bing, bing, bing. Yeah. And these are things that we make incredibly easy with great technology. Say that again. Say that again slowly. It's absolutely important in states where there are paid sick leave laws to not...
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commingle vacation hours and paid sick leave laws. You got to track them and provide them separately. And this is the bank, this is the former banker in me. I say this to the doctors all the time. You got to think about the unwind, right? Something goes south with this employee and you're here in the state what requires you to pay out unused vacation, but you can't figure out what was used for vacation, what was, because you're tracking them together, you're putting yourself in a position.
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to either have a lawsuit or a difficult time with that individual. So we just make it easy. Yeah. And by the way, you're breaking up with this employee, usually probably not for a good reason. Right. And here you are having to stroke a bigger check to that person to cover your ass when really they only deserve maybe a third of it, but you have to because you have no idea tracking it. yeah. so, uh, vacation versus sick.
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Six the keyword, right? Six the keyword. Six is definitely different than vacation. Yeah, I mean, we can talk about specifics. And by the way, in Washington, King County is different than... Oh! Yeah, King County, they have their own labor compliance laws. I just wanted to go back to that real quick. Oh, he just burned me, folks. Burned me. See? Just when you think you've got it all figured out as a...
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F-ing consultant. Right. Still, King County, of course. Of course they do. Of course. Right. The thing is, you know, a lot of these doctors, come from a place that they've been an associate at where they've seen practice owners track time on a patient platform like open dental. And then they're tracking PTO and sick time, usually in the same bucket on a spreadsheet, right? They're DIY-ing their HR. They are their HR. And so
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Doctors, again, it always goes back to that perspective. They've seen it done inefficiently and they see they've seen how maddening it is to track vacation requests with sticky notes as an example. Yeah. Yeah. Yeah. Yeah. Yeah. So, Obviously you need help in HR. There's no question about it. What makes HR different? And I don't give too many people plugs on the show. Like this is kind of like leading the witness, but I'm, but I'm being serious because I get a lot of the
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You know, I don't want to work for HR, but I want to work, uh, HR for health, but I want to work with this other firm and, and maybe it's the ADP support or maybe it's, uh, there's some others, right? Yeah. And I think there's a lost in translation there on the value for you guys. So I'm going to give you the opportunity to kind of differentiate yourself a little bit from all the other different HR firms that may or may not be more expensive or less expensive. Just what's the difference.
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Right. Well, the easy answer is nobody does what we do. But to get into a little bit more specifics, mean, we are a solution that provides these doctors, the end of the day, software to manage HR processes. So it really comes down to two basic things. Our competitors are typically much, much higher when it comes to a startup fee or a setup cost because they're paying for that expensive handbook.
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And I think really the thing that sets us apart really is that we're not just HR compliance, but we're also great technology. Whereas our competitors are primarily a handbook only type of solution. And a handbook only type solution, Michael, that forces doctors to have to live in different locations in their office for tracking time, benefits if they're offering benefits, or if they're in a state that requires benefits. And it just means
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more time spent on HR related matters, less time dealing with the operational components of the practice through the transition. And having a solution as they're moving into the practice and transitioning, whether there's an office manager or not, everybody needs the right tools to manage HR better. And that's what we're able to provide. What I'm hearing is it's like a holistic approach. from soup to nuts and it's integrated.
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Because I know you guys got payroll. I know you got the time clocks. I know you got, of course, the great forms. You keep all of everything, e-signs, e-signatures. mean, it's really holistic. And that's what I like about it. Not just the fact that you are dental specific, which to me, being dental specific is key.
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Right. Because you could just be a generic HR firm, but there's got to be some big differences there between you guys being dental specific and not. Oh, absolutely. Absolutely. And more specifically when it comes to the ADPs and the paychecks of the world, payroll companies that have gotten in the HR space, really what that looks like. And we certainly saw the worst of what that looks like through COVID because you've got by and large ADP and paychecks they have
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customer service representatives reading a script for HR questions. They're always at the end of the day going to be a payroll company with sort of kind of some HR solutions. know, here's a really good example of a major difference between us and all the payroll companies when it comes to that handbook, the foundation of it all, Michael, you know, that's usually that heavy lifting of preparing a handbook with payroll companies is usually done by the doctor, which means they don't usually die.
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They don't know. They paid a ton of money for it, but they don't actually get through it because it's super cumbersome and annoying and in time consuming. Yeah. Whereas we make it super easy for these doctors to get through that, that process. But okay. Last question, buddy. Yeah. I feel like this is a good one for transition. So best for last. And folks, if you've hung in there the whole episode, thank you. Sometimes, sometimes people piecemeal these episodes together. But for those that didn't hang in,
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To me, this is the bread and butter. So the strategy of dropping somebody after you've hired them, because they don't know that you walk into a practice and you find out that Nancy Jo in whatever role is cancerous, not willing to adapt, starts bringing the other team members down no matter how important that person is.
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In their actual roles, you have to cut cancer when, when you see it and you find it and you diagnose it. Usually folks do that way too late. All things next level helps with, but, but from an HR perspective. Okay. Here we hired somebody. They've onboarded them. got all the forms. We, they signed the HR manual like we've talked about and we're six months in and we're like, we got some cancer going on over here.
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Right. What's the strategy? How do you, how do you cut when you need to? Well, and the whole right to work, I'm in a right to work state. I can just fire this employee. Not true. The whole right to work thing is a complete mess. We could, we could get more into the details of that, but by and large doctors just simply have to be careful and where it all starts, you know, and that's
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That's a great example of having HR for Health in a practice because it's a proactive approach to dealing with the doctor realizing six months into practice ownership that they do have a bad employee and they do need to get rid of that individual, cut the cancer out. But you can't just arbitrarily terminate employees. got to document. If it's an employee that's pregnant, disabled or elderly, that's a high risk termination. so having support
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to navigate through the complexities of terminating anybody is important. And every state now, certainly Washington and California have the most, but every state requires a change in relationship documentation. There's a handful and a half of documents now every state requires. these doctors got to protect themselves. Wage and hour claims, wrongful termination lawsuits are a major problem of dental industry right now.
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because doctors aren't making sound decisions with separating an employee from the practice. Another emotional thing to have to go through, but they're not properly documenting and they don't have any way to prove why things are the way they are. Separated this employee, it makes it really easy for that ex-employees attorney to come back on the doctor. Document, document, document, document, document. It's so important.
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Hey, you know, what's shocking. I'll end it on this is that your employees know the law better than you do. I promise. They They do. They do. They know, they know where they live. They know what County they're in. They know they have LL and I sitting on their fast speed dial. They absolutely do. That's a point. And and so if you aren't serious about this, which is why it's part of my program, because it is serious.
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You're going to get smoked at least once in your career because they are smarter than you because they know their rights. And if, and if they're pissed for any reason, right. They, they, if they don't know, they will find out. someone on the other end of the phone lawyer, LNI support, whatever. We'll educate them and they, will get smoked. So it's.
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It's sad that we've come to this place and in our country, quite frankly, I'm not going to turn into Joe Rogan right now, but we are here and there's a solution and these guys are amazing. Final thoughts, Mr. Scott Mueller, your pleasure always to work with, but just final thoughts, mean, anything that you want to tell my listeners and we're going to have all of your contact information below if you want to.
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provide something, we can put it in there, but you've seen the QR code, folks that are on YouTube that is flashing on the screen. Pause and scan that. because that's, you want to explain what that is, Scott, and anything else you want to provide? Yeah, yeah. So the QR code, once you scan that, you'll actually be able to receive a transition toolkit. Very informational.
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great things to consider as you're looking at possible practice ownership and the importance of having an HR solution in place. I guess to kind of wrap things up to the point you just made, you're right. These employees do know and unfortunately they wield it as leverage and take advantage of these doctors, especially in the complex states. Oh, this doctor's not.
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not offering me or providing me proper paid sick leave, the calculations so that, you know, loss breaks, breaks. Yeah. It's an employee's market right now. And doctors got to protect yourselves. Yeah. Yeah. Totally right. Okay. Cool. If you want to get ahold of Scott Mueller, check it out below. Scan the QR code. It's a cool resource. I checked it out and folks, we are continuing this effort.
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and getting you guys, uh, educated about the process. And this is just another feather for the cap. Join us for the next episode. And like I said, go to the top and start from the top because you're to miss some really great stuff at the top. the guy that Scott Mueller works for, Ali Oromchian, another plug of his episode of understanding LOIs is a great episode and we enjoyed having Ali on the show.
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from dentalunscripted.com and all of everybody that goes into this program. Thank you so much for being here, brother. Thank you. All right. Take care, guys. Have a good one.
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We want to hear from you. Interact with your host, Michael Dinsio. Follow us on Facebook, Instagram, and YouTube. Comment and subscribe.