Transcript
stevenmc: All right, everybody, welcome back to another episode of The Disruptors, where we're highlighting innovators within the physical therapy industry and helping make innovation feel just a little bit more accessible to you on each and every episode. Today, I am blessed to be joined by Daniel Sage of Hands on Diagnostics and so much more as he and I have got to know each other, but I um want to pass it over to you, Daniel, to do a quick intro before we we get into it.
Daniel Sage: Sure. Yeah. Thanks for having me, Steven. And ah again, yeah, Daniel Sage from Hands -on Diagnostics. I'm a physical therapist. I was in private practice for 30 years in South Florida. um We implemented diagnostic testing and you speak of innovation and and cutting edge and forward thinking and pioneering things. We were hands -on diagnostics first, client in 2013. We put EMG studies, nerve conduction studies, musculoskeletal ultrasound in our practice in 2013. And at that time we did it just to elevate our company, our clinics, what we were doing professionally.
Daniel Sage: really sophisticated our ability to make a physical therapy diagnosis with much more accurate testing. And it was a game changer for us for 10 years. And then I sold the company, but from an innovative standpoint, hands on diagnostics, they were doing diagnostics for their own practice since the nineties. I mean, and not many PT practices were doing that stuff. Yeah. And they brought it to the market in 2013. And I think at that time they did a research study, 3 % of physical therapists in private practice knew that they can actually even perform diagnostic testing.
Daniel Sage: Nobody knew about it.
stevenmc: Yeah.
Daniel Sage: and you know And then when I found out about it, I looked into it, checked our practice act, checked the you know the Medicare language and sure enough, yeah. So it was an awesome journey for me and I sold the company and now I'm just paying it back and helping them out.
stevenmc: That is so cool. ah you know I'd say when we first got ah we first started really marketing on the the remote therapeutic monitoring RTM side, I think that 3 % may have held too.
Daniel Sage: Yeah.
Daniel Sage: Yeah.
stevenmc: In Q1 of 2022, luckily it doesn't hold quite that low today, but but still is is is not nearly as high as it should be, but that's not what we're here to talk about.
Daniel Sage: Yeah.
stevenmc: So Daniel, you're a physical therapist, right?
Daniel Sage: ye Yeah.
stevenmc: Started your own practice.
Daniel Sage: Yeah. Yeah.
stevenmc: what
Daniel Sage: Yeah.
stevenmc: What got you into physical therapy? like Why did you decide to go down that path?
Daniel Sage: Yeah, I mean, look, I think like so many P .T. say, you know, it's like the the passion of helping others, of changing lives. I mean, honestly, I mean, my undergrad was in cardiac rehab. I would have went to med school, um but then I had the opportunity to go into physical therapy and and I had a vision of always opening my own practice. So two years out after I graduated, I opened up my own practice and I felt I was operating with a certain amount of autonomy and decision making that I can decide how I want to treat patients.
Daniel Sage: What do I want to do with patients? How do I want to affect their lives? If I didn't have that opportunity, I would have went to med school because I just have that mindset and had that mindset that no one can treat a patient as good as me. And that's not being cocky. It's just being confident that I love what I do. I'm passionate about how I help people.
stevenmc: Yep.
Daniel Sage: I didn't want someone to tell me how to do what I you know wanted to do. So ah you know I went into private practice and um stumbled into something and it was ah really an awesome ride for close to 30 years.
stevenmc: That's
Daniel Sage: I know I'm old.
stevenmc: That's so cool. So walk, I think it'd be really, there's there's there's two pieces. I think I'm going to go actually like closer in the past and then maybe back a little bit further. So you brought in hands diagnostics in 2013, right?
Daniel Sage: Yeah. yeah
stevenmc: um walk me through the decision -making process for you, right? So you know as others that are listening might be considering more innovative tools and approaches, you know what was your decision -making process?
Daniel Sage: Yep.
stevenmc: What did you need to hear? ah just I would love to get like a peek into to your mind during that decision -making process.
Daniel Sage: no Yep, yep, yep. So when I found out about it, the the first thing after I did my due diligence that we can do it, yes, was what purpose is this gonna serve for my practice? What is this gonna do for my patients? What is it gonna do for my staff? So, you know, I took a hard look at the sensitivities. when When I do an evaluation on someone's neck and I do a special test called a Sperling's test, it's 30 % accurate. So I can do that differential, diagnose that test, call it something based on performing that test and miss it 70 % of the time.
Daniel Sage: So there can be cases where we're treating somebody with what we think is one thing, but it's actually another. So it had to check the box off from what is it going to do in terms of delivering better results for my patients?
stevenmc: Hmm.
Daniel Sage: Well, the idea is an EMG nerve conduction study is almost 85%, 88 % accurate. So it raises the level and accuracy and calling something what it is makes sense.
stevenmc: Yeah.
Daniel Sage: Then, I then can then guide my treatments based on what I found. That's cutting edge. It doesn't happen in our field. And it felt right for me in 2013 because I did my thesis in PT school on autonomy in physical therapy, because autonomy is an important aspect that defines a profession. There's certain things that define a profession, backed by science, research -based, and autonomy is one of those things. so I really felt it would raise the level and sophistication of my physical therapist. It would really help us practice with autonomy, more effective treatment plans, better outcomes, no brainer, really no brainer. So that was the impetus and the push of why we did it. And it positioned me much more different than my competitors, not even close.
stevenmc: Yeah.
Daniel Sage: and And so really, Steven, honestly, that was the reason. the The secondary effect was reimbursements were about five, six hundred dollars an hour.
stevenmc: That and makes it make sense, right?
Daniel Sage: yeah I mean, it does, but I tell everybody, you know, I never make a decision because of money.
stevenmc: And then easily.
stevenmc: Yep.
Daniel Sage: because Because if I make a decision because of money, it's never enough. You you know you want more and more money. But when the decision is when the decision is back bit back by purpose, if it fuels what we're trying to do in our clinics, if it does something for our patients, and what I did for my staff, I took therapists that were making 60, 70, whatever back then, $70 ,000 a year.
stevenmc: Yep.
Daniel Sage: We pay a board certified person 120 a year. I changed their careers.
stevenmc: yeah
Daniel Sage: and and and And it feels good. So that was the the thought process behind it.
stevenmc: Yeah.
Daniel Sage: And what I didn't realize nine years later when I decided to sell the company, what it did for my exit, for the profit margins, for we didn't have declining reimbursements in 2013. It was still pretty good.
stevenmc: So I want to focus on one piece there because I think I i i want to make sure I'm right on this.
Daniel Sage: so
stevenmc: So from.
Daniel Sage: Yeah.
stevenmc: from Jump Street for you back in school, ah you really wanted to figure out how to practice ah as auto autonomously as possible, right? So like that was your drive, and that you had a passion behind that, and hands -on diagnostics gave you that pathway in a a very real way that made sure, and we'll get to, it
Daniel Sage: Yeah.
stevenmc: checked with a box in terms of lenses you would make a decision on, right? But I think it's really important for people to hear that you had a passion, which if we boil it down to like even a almost like a more primal, right? Like you wanted to practice autonomously.
Daniel Sage: Yep.
stevenmc: And then from there, it was, okay, well, how do I make it in my control to do that? And this was the the optimal way to make that happen. Like I I think that is, if it first of all, is my sort of like boiling of that down correct?
Daniel Sage: I mean, it it is, you know, the the the other thing that was really important to me in practice was not only taking care of my patients, but taking care of my staff.
stevenmc: Yep.
Daniel Sage: I mean, My staff was very, very important to me and as practice owners, you know, it's like one day you go to work and the next day a therapist sends you an email and says, here's my two week resignation. And you're like, oh, here we go again. I got to jump back in patient care. I got to drive to that clinic. So I always had the mindset, what can I do more for my staff? How can I, you know, take care of them better and better? And from a financial standpoint, well, if we're doing diagnostics, we're bringing in $500 an hour.
Daniel Sage: And I can generate three, four, $500 ,000 more a year. I can take care of my staff. i can have more I can have more effective sustainable bonus programs, which we did.
stevenmc: Yep.
Daniel Sage: And I could pay a therapist. The APTA data, in July of 2023, a therapist who's trained in electrodiagnostics under the APTA makes $70 ,000 more a year than any other PT.
stevenmc: Holy cow.
Daniel Sage: Yeah, and a PT that's like orthopedic, OCS, orthopedic certified specialist, they make eight grand more a year.
stevenmc: Yep.
Daniel Sage: But someone in diagnostics makes $70 ,000 more a year. So yeah, so I'm able to offer that to PTs that when they take a job for me, never knew that they can now for free join an APT -approved, eight well American Board of Physical Therapy specialty approved residency program.
stevenmc: That is wild.
Daniel Sage: I just changed your career.
stevenmc: that's That's amazing and there's there's two pieces that I want to make sure to highlight there and one is let your passion drive where you want to innovate. right I think you absolutely did that and whether someone's passion is on you' practicing autonomously, yeah I definitely hear the taking care of your staff and feel very, very strongly about that on on our side as well, but like maybe your passion, right if you're listening, is is not that.
Daniel Sage: Yeah. Yeah. Yeah.
stevenmc: right is I really want to better, I really want to own the patient reported outcomes.
Daniel Sage: Mm hmm.
stevenmc: like or I want to look at recidivism. Wherever your passion is, let that drive you into where you want to innovate.
Daniel Sage: Mm hmm.
stevenmc: And if you do that, it's going to be able to help you.
Daniel Sage: Totally.
stevenmc: As I would imagine, you had you know a roller coaster, which ups and downs, but hopefully you're trending like up and to the right.
Daniel Sage: Yep.
Daniel Sage: Yep.
stevenmc: And it it helps buoy you right in those those tougher days.
Daniel Sage: Yep.
stevenmc: um On the, that is just a wild, wild Delta from eight to 70. I mean, that it's just, that that's, that's, that's crazy.
Daniel Sage: Oh, yeah. Yeah. And PT's not many know, like when I talk to owners now and you know, every, every owner, every private practice owner today, their, their pain points are declining reimbursements, working harder and harder in the business.
stevenmc: Yeah.
Daniel Sage: Right. Retaining staff. So, and I'm a firm believer that, you know, practice owners, the business should be working for them in order for me to be the dream maker. In order for me to enjoy what I do, to continue to open up practices in this town, in that town, the business has to work for me. If I'm working for it, I become a slave to it. I can't create on it. I can't build on it. And if I can't create and scale it, I can't help as many people as I want.
stevenmc: Yep.
Daniel Sage: So I'm a firm believer that you know sometimes practice owners, they get stuck in there in that one lane. So if we're talking about innovation, and and taking that leap of faith, well, sometimes it requires coming out of that comfort zone, out of that lane that we know, to figure out what do we need to do, and it might be a little uncomfortable because we've never done it before, but we gotta do something different. Otherwise, year after year, we're getting cut more and more in our reimbursements, and it's not okay. It's really not okay, because I believe in the private practice PT, I believe in what we do, but we can't do the same thing and expect a different result, especially in the next couple of years. and
Daniel Sage: The last five years, Medicare's conversion factor cut 10, 10 .3%.
stevenmc: Yep, yeah, the i know I know we've been at a couple breakthrough events together, right?
Daniel Sage: It's real.
stevenmc: in And the the graph that Chad Madden always throws up, where you could see that the conversion factor is less today than it was in 1994, it's a a very sobering and infuriating chart to to look at.
Daniel Sage: Yeah. yeah.
Daniel Sage: Yep.
stevenmc: But it's that's real, and I couldn't agree with you more. the you As you implement it, so obviously you you led with patients and then the patient outcomes, and I will say that is that's been our experience as we talk to practice owners across the nation.
Daniel Sage: Yeah.
stevenmc: No matter if it's a single you know owner operator all the way up to, hey, we have 5 ,000 clinicians, it does need to be outcomes led for it even to get exciting for for folks.
Daniel Sage: Yep.
stevenmc: and and I don't think it's that way in every other medical like industry or vertical, however you want to describe it, right or profession.
Daniel Sage: You know.
stevenmc: It's something that makes me really proud to be in the PT space. is like That is of utmost importance.
Daniel Sage: Mm -hmm.
stevenmc: and so
Daniel Sage: Yeah.
stevenmc: as So you you talked a little bit about that decision making process to to move forward, but I'd love to take actually like the next layer of the onion there, right? So did you, what was the framework you used? Did you like, okay, we're going to look at outcomes, then staff and business, like how, or was it just, was it more of like, we're going to wait these things? Like, how did you build that decision framework to figure out what you're going to move forward with?
Daniel Sage: Well, the thing is, and I will speak to that too, it like yeah as PTs, we're all about outcomes, we're all about taking care of patients, doing the right thing, and and really sometimes sometimes a little a little excessively, but it is what it is.
stevenmc: Yeah.
Daniel Sage: But I can tell you this, we did, um in hands -on diagnostics, we did a research study in 2020. We took 462 patients that all had an EMG, nerve conduction, and ultrasound performed. 61 % of those patients, the therapist had to change the treatment plan because they were treating something that they didn't know about that they found out on a diagnostic test. 61 % of the time. So if you talk about outcomes and raising the bar, my God, we've we've had cases over the years, podiatrist sends a patient to us for plantar fasciitis, pain in the bottom of the foot. We're treating it, not getting any better. Well, before diagnostics,
Daniel Sage: The patient either, one, would self discharge and say, well, they didn't help me. Two, go back to the doctor and say, they didn't help me. Doctors send them somewhere else. Three, doctor does an injection medication and other things to try and figure it out. But after diagnostics, we actually did a lumbar EMG on the patient and it revealed the patient had a bulging disc. It was nothing to do with the foot.
stevenmc: Yeah.
Daniel Sage: So treat you treat the back, the foot gets better. Or we had cases where you think it's ah coming from the neck, we do an EMG, the scalings, the muscles outside are pushing on the nerves out here, treat the soft tissue, symptoms get better. So from an outcome perspective, there's nothing like it. There's nothing, there's innovatively
stevenmc: i
Daniel Sage: There's nothing a physical therapist can do in an evaluation that will substitute 80, 90 % accuracy in advanced diagnostic testing that we we provide.
stevenmc: Well, what you're talking about is a, like not even, titration of care is a terrible phrase. I must strike that one from the record, right? But like, you're just, you're being, I mean, let's call it surgical, right? Like it's it's, hey, this is exactly where we need to go. And we have an extremely high level of confidence there to be able to do that.
Daniel Sage: Yep.
stevenmc: And I would have
Daniel Sage: Oh, yeah.
stevenmc: I'd have to imagine that, it and I'm definitely going to get over my skis and then you're going to help with some data that I'm sure you have. right is I'd have to imagine, especially for your newer grand PTs, like holy cow. right like This has got to be huge.
Daniel Sage: you Yep.
stevenmc: and Of course, I'm not saying that it doesn't help the the more you know the the veterans out there, but gosh. i mean When I think of my own career, right like and all these yeah the the new grads now have like you generative AI for Excel, and we have not that. right like I got to think in my non -clinical, I'm just trying to come up with a you know something similar, but gosh, look maybe I'll just stop there and then let you talk.
Daniel Sage: yeah yeah
Daniel Sage: Well, yeah I know what you're going with and In there's that article that the APT put out in July of 23 and they compared salaries, they also talked about the ideal therapist that really significantly makes it makes a big splash is someone else three to five years that's now going into diagnostics. Because they're just going to change their career for the next 15, 20 years. And I talk to owners now and I'll tell an owner, look, what's your goal? Well, I want to exit and sell my company in the next five years. Fair enough.
Daniel Sage: Let's put diagnostics in your practice for all the right reasons professionally.
stevenmc: Yep.
Daniel Sage: I can, I can easily slam that in. But if I'm an owner, but I was, and I, I, and the only reason why I went with hands on diagnostics is because when I retired from my company, I spoke to Demi, our owner, he's like, look, come work with us. Come help practice. It said great. cause I can't sit around doing nothing, but
stevenmc: Yep.
Daniel Sage: my my passion ah My passion about it is I watched what it did for my practice. I did not know when I put diagnostics that nine years later I'd be looking at declining reimbursements that didn't really affect me as much because I was bringing in so much money in diagnostics, that when I sold my company I got a significant multiple and a great even because of that.
stevenmc: ye
Daniel Sage: So now when I talk to owners and if their goal is the next five years exit, well, I can tell you right now, if you take an owner today, they do nothing differently in five years based on the trends of reimbursement. The value of their practice is going to go down and owners will say to me, well, we're going to offset that with more volume.
stevenmc: yep
Daniel Sage: Got it. We can work on our better percent arrival. People are arriving to the clinic. We could try to renegotiate contracts, which are all important things, but it's not going to make near the splash. of EBITDA and profit margin increase of putting diagnostic testing in where these guys are making four or five, $600 an hour, not even close.
stevenmc: Yep. Yeah.
Daniel Sage: And they're willing to work harder and harder to generate more volume when they're getting reimbursed less and less. So the owner, I tell the owner, look, if your goal is five years, don't get trained in diagnostics yourself. Take a PT that's in your practice three, four or five years out set their career off for the next 15, 20 years. You're going to change their lives. They're going to change your practice. They're going to commit to your practice because they got it's one of the things that they have to commit to their practice if we're paying for their residency. But I just, as an owner, I just changed the value of my practice probably 20 to 30 percent and my multiple times a couple.
stevenmc: Yeah.
Daniel Sage: And I just took a PT that's three, four or five years out and I just changed their lives.
stevenmc: Well, you're exactly right. It's it's it's really a a beautiful, like virtuous or yeah a virtuous cycle, right as you raise your EBITDA percentage, right your multiple goes up.
Daniel Sage: Yeah.
stevenmc: And also, like if you're raising the percentage, that means also the you know the actual number itself is going up.
Daniel Sage: Yeah.
stevenmc: right's It really is like, oh, well, instead of at 200 ,000 EBITDA getting a 4x multiple, now at 250, because that percentage is so much better and the business is so much more efficient, you're getting a 5 or 6x multiple.
Daniel Sage: Yeah.
Daniel Sage: ye
Daniel Sage: Oh yeah.
stevenmc: Which means you're you're like, that's fun math.
Daniel Sage: Yeah.
stevenmc: That is fun, fun math.
Daniel Sage: yeah and but And the thing is, I never knew that. See, when I put diagnostics in, my mindset was, what am I doing for patients, my staff? Yes, I'm raising my profits, but I was making great money then too. So what the necessity level of fighting declining reimbursements was not near as what it is today. So fast forward, when I sold a company. I'm like, I got to help practices because this this is not fair.
stevenmc: Yeah.
Daniel Sage: And I talk to owners all the time. And we signed up to practice. She's 69 years old. She just signed up with us about a month ago because her practice isn't worth anything anymore. And the only way she's going to sell it is to raise the profits. She's not doing that, which straight reimbursements what's happening in the market. So she put in diagnostics.
stevenmc: Yep.
Daniel Sage: I spoke to this other guy in Long Island. He's been in practice 40 years and he still works 60 hours a week because he can't afford to hire more staff.
stevenmc: Yep.
Daniel Sage: So we'll put diagnostics and whole train into it. He'll make four or $500 an hour. Now he can afford someone else, let them do the PT work. Now he's not working ah like a slave into it, treating 20 people a day, 60 hours a week. He's able to step back and do something much more higher level. And the other thing I want to mention is from an innovative standpoint, PTs are now able to play in the sandbox that only neurologists and physiatrists have been doing. they're They're generally the caregivers for, you know, the providers for EMG, ultrasound, nerve conduction studies, but now a PT can do what a physician's doing, game changer.
stevenmc: Yep.
stevenmc: Oh, I. I love that in a few other episodes we've talked about that a PT is more than just a physical therapist, right? Like more than just a a movement health a professional, right?
Daniel Sage: Yeah.
stevenmc: there's There's, especially as we talk about another like behavioral change, right? Like PTs have some of the best, if not, I go as far as to say, the best skillset to affect behavior change in a patient, right?
Daniel Sage: Mm -hmm.
stevenmc: like You're getting people that have never exercised before to exercise. You're getting people to be able to rethink the way that their body moves.
Daniel Sage: Yep.
stevenmc: You're getting to rethink habits. like All of that happens within that 10 visit, however many visits right that you're spending 30 to ah an hour with that that patient.
Daniel Sage: Yep.
stevenmc: and It's because a real relationship gets driven and as a result. and i just I love this idea of allow of facilitating a more accurate plan of care based on the diagnostics.
Daniel Sage: jack Yeah. Yeah.
stevenmc: and even if i yeah Even if you did have fewer visits per episode, like your self -referral rate is going to be through the roof.
Daniel Sage: Yeah.
stevenmc: because people are going to know that you're being extremely ju judicious with their resources, right?
Daniel Sage: Oh, yeah.
Daniel Sage: here
stevenmc: So your self -referral rate is going to go through the roof. You are going to have great word of mouth and and and you know referrals from other patients. And gosh, I got to imagine even your referrals resources at the the MD level are are going to get even more excited as well.
Daniel Sage: but
stevenmc: Like, okay, well, I know if I send them to Daniel, then you know the likelihood that they come back to me with a similar issue, the recidivism goes way down.
Daniel Sage: Yeah.
Daniel Sage: That's exactly right.
stevenmc: um its
Daniel Sage: Yeah.
stevenmc: and it's it's a very like There's just so many like ripples right to to to that a positive ripple effect that happens from there.
Daniel Sage: Oh, yeah. I mean, we we we as we really penetrated the community What we decided to do is we let our physicians know that we had a residency in diagnostics. He had first therapists like, oh, am I gonna annoy a doctor because they do diagnostics or they do EMGs? Okay, so if a neurologist is my referral source and he knows that we're doing EMGs, we respect and we don't do e EMGs on his patients if that's what he wants.
stevenmc: Ciao.
Daniel Sage: But we we have physiatrists that sent diagnostic referrals to us We have huge orthopedic groups that send diagnostic referrals to us pre and post surgery to see the health of the nerves and so forth. So the exciting thing is at PT practice, we became a referral source. Like a doctor writes a prescription to go to the MRI facility, they're sending patients to our PT place for an EMG and not the neurologist. And why? The quality of our reporting is significant. Neurologists,
Daniel Sage: You know, sometimes they have the nurse that does a nerve portion. They come in, they drop the needle, they're in, they're out. They do EMGs once a week because they're doing a million other things.
stevenmc: Yeah.
Daniel Sage: But our PTs, this is what they do. So the quality of the test is amazing. We we turn around results within 24 to 48 hours. Our referral sources value that. Sent and and just started sending people to us just for diagnostics. And even before I retired, My one, the guy, Sean, who's a training, orthopedic calls him up, hey, Sean, got this case, blah, blah, blah. I'm doing surgery in two weeks. I'm gonna send him to you. I want you to do the EMG, do this, do that.
Daniel Sage: And then Sean would call the doctor throw up with the results and go over it together and guide the doctor in terms of his surgery. I mean, what PT is having that communication with a surgeon? They're not.
stevenmc: Yeah.
Daniel Sage: That's autonomy in PT. That's raising the game. and And I can tell you this, You're right, PTs, the greatest PTs know how to connect with the patient, motivate them, reach them emotionally, touch them mentally. I got all that. But if I can do all that, plus I'm going down the right lane because I've got accurate diagnostics, I just hit a grand slam. And and you're right, doctors loved it. They saw the value of patients. Patients in that research study we did as well, I forgot to mention, 90 % of the patients
Daniel Sage: felt more engaged. They felt more understanding of their problem because they're watching they're watching their PT evaluate their shoulder doing an ultrasound and showing them the tendon and the inflammation and what they're working on.
stevenmc: Yep. Yep.
Daniel Sage: it the The trust factor is significant.
stevenmc: Oh, I, there's a couple of things that that come to mind, but absolutely right. You give, you make it, you put it in like layman's terms, right? For the patient, right? Like, Oh, okay.
Daniel Sage: Yeah.
stevenmc: That thing isn't supposed to do that. Right? Like.
Daniel Sage: Yeah.
stevenmc: i mean and I'm not a clinician. i had yeah The last the last like biology or anatomy class I took was in freshman year of high school.
Daniel Sage: Yeah.
stevenmc: ah so you know
Daniel Sage: Yeah. That's all right.
stevenmc: Physics was easier for me, so I went that route during an undergrad.
Daniel Sage: Yeah. Yeah.
stevenmc: um But like that can make a lot of sense. And when I hear, I just get put into my my own terms and on ah the value of it. but One of the things I do in my training is we do velocity -based training. So we know how fast fast the bar is moving at different points of the lift. And like that is exactly, oh, what do we need to work on?
Daniel Sage: got it
stevenmc: like It's not a, okay, well, let's try working on a you know deficit pool for four weeks.
Daniel Sage: mm hmm
stevenmc: like Well, your your problem isn't from your you know the lift off to your knees. It's really from your knees to your hips. So, we're just gonna overload your quads for the next four weeks. so It's to targeted, right? And and people, they they don't wanna be in pain for any longer than they have to be. And so, ah just, I mean, the the value prop is as a patient just makes so much sense. So, so so much sense.
Daniel Sage: Yeah.
stevenmc: I i do wanna come back to you and and ask it a question that I really like asking. um And I'm gonna put you on the spot.
Daniel Sage: Yeah.
stevenmc: so
Daniel Sage: That's good.
stevenmc: I don't think I've given the heads up on it. If you had a magic wand and could fix one thing within physical therapy, what would you fix?
Daniel Sage: the reimbursement model is horrible. The absolute is horrible. It's inconceivable, that's the right word, it's inconceivable to think that in the last five years, reimbursements are going down. The value of us from an insurance carrier's perspective is less and less Medicare. And in private practice that don't do a lot of Medicare, oh, I don't do a lot. So yeah, but you know what? Most payers eventually follow the trends of what the federal government is doing. And Medicare just cut the PT evaluation code 3 .4%, I think, this year. The most sacred code to the physical therapist is not manual therapy, Therax, balance training, it's the evaluation. It's where the PT is putting their thinking cap on, determining what's wrong and coming up with a treatment plan. Well, guess what? Our government says it's worth less and less. And it's not right. We're the ones that are keeping people out of hospitals,
Daniel Sage: away from medications and injections. We are you know holistic practitioners, changing lives and people keeping them healthy and living longer. Why are we getting valued less and less? So the the reimbursement model is horrible. And let's face it, every PT, every private practice PT that has a purpose and a passion, in order for me to scale that and to facilitate that, I need money.
stevenmc: Yep.
Daniel Sage: Money is a form of energy that allows me to fulfill a purpose. And if I don't have that, I'm strapped, I'm stressed, I'm anxious, I can't take care of patients, I can't take care of staff, but we're getting reimbursed less and less. So really what that says is, what's gonna happen to the private practice owner in the next 12 months, 24 months, 36 months? Why should a private practice owner be busting their butt for all these years, taking all this risk on, managing staffs of 30, 40, 50, 100 people
Daniel Sage: and the value of the practice is getting less. It doesn't make any sense.
stevenmc: yeah and
Daniel Sage: That's it.
stevenmc: you know I hear you say reimbursement, but you know what I think I hear is almost like an undercurrent to that is the value, the the understanding of the value of a physical therapy.
Daniel Sage: and
stevenmc: and if if If I'm hearing that correctly, i you I would agree with that in that a similar analogy that we as a society, we love our firefighters, right? But we don't give a lot of love to the people that put in the fire alarm. And I think very similarly, physical therapists have so much impact in ah and helping people to avoid way more expensive, you know bigger bigger levels of of treatment, right?
stevenmc: and
Daniel Sage: Yeah, yeah, yeah.
stevenmc: So they they create all this value and I don't actually think there's a lot of people that say, oh, I don't believe they're creating value. It's just, gosh, it's a terrible job of proving it and figuring out ways to extract the value back that they're creating.
Daniel Sage: and's up yeah Yeah, our lobby too. The problem is we we don't have a strong lobby you know at at at the federal level and and that's unfortunate. AMA obviously is the strongest. Chiropractors have a pretty strong lobby. Ours is not the strongest. So we just get stepped on and we get looked at as like personal trainers and we're not. I used to work in brain injury before I went into private practice. Well, you know treating someone post stroke That's extremely technical stuff.
Daniel Sage: But I'm still the same PT then as I am in my private practice. And my thought process and my critical thinking is the same. It just happens to be with a shoulder, a hip, a knee, you know ne you know, balance issues and things like that.
stevenmc: Yep.
Daniel Sage: But we're just getting devalued year after year. So my purpose and passion now is to let private practice owners know you don't have to sit and take it. And you can work on certain things that'll help, but if you really want to elevate what you're doing professionally, if you want to innovate what you're doing in terms of ah operating your practice, how you're treating patients, wouldn't you want to play in a sandbox of neurologists and physiatrists? Wouldn't you like to have CPT codes at your disposal that are making you four or $500 an hour? You deserve that. We deserve that. Why? You know, the other thing is this. I'll tell you this. I promise you.
Daniel Sage: have these EMGs and nerve studies and neurologists do, you know what they probably do with the result? They say, this is what it shows, take this medication.
stevenmc: Yep.
Daniel Sage: So what we do is we say, here's what the results are. Now we are gonna do certain neuromobilization techniques based on those results, because we teach practices how to perform certain neuromobilizations based on the results of an EMG nerve study. So now we teach practitioners how to implement a treatment based on the results of an EMG and actually do something different. Boy, that's really using a diagnostic test for a clinical utility value versus what a neurologist does. That's innovative.
stevenmc: Well, and then you got to talk about the, you know, the, the pharmaceutical route, right?
Daniel Sage: Oh, God.
stevenmc: And like, it's not cheap. It's not cheap to go pick up that but like, no matter where it stands and in your formulary for your payer, right? And all of a sudden it's like, I don't want to pay 75 bucks a week for medicine or gosh, I have a $40 copay for PT, right?
Daniel Sage: no Yeah.
stevenmc: like Like which one do I want to to go down? um And sometimes it could be that easy, right, for for patients.
Daniel Sage: yeah
stevenmc: But unless you're even like setting it up for that to be be possible, i then then that that
Daniel Sage: Yeah.
stevenmc: that that opportunity isn't there for the patient, and then they don't have the agency like we've talked about prior. like mean Really, again, you're giving them agency over their own body.
Daniel Sage: Oh, yeah.
stevenmc: right Here's the information. Let me help make you an empowered patient and person, and let me show you that our our bodies are incredibly resilient, they're malleable in the best way, and they will heal if taking down the right path.
Daniel Sage: taking down the right path, yeah. You take that example of a podiatrist, and you know, patient, oh, you have plantar fasciitis, take this medication, maybe they do an injection. I don't know what they do medically, then go to therapy. Now we're wasting all these healthcare dollars treating something that is not, that I discover on an EMG. That's perfect.
stevenmc: Yep.
Daniel Sage: that That's the way we should operate. I mean, throughout the years, and and when we were doing diagnostic, I'd say to my evaluating PTs, it's like, it's almost malpractice. If a patient's coming in with some kind of referred pain, radiating pain, numbness, teeming, weakness, it's almost malpractice if I don't perform that test because what if it's something else? So what we would do is we communicated with our doctors. Once they knew that we had a residency program, they were like, really? They started sending their own patients to us. And then we also, we also went into doctor's offices. I could put a trained therapist into doctors and we put
Daniel Sage: diagnostic testing in a doctor's office. So the doctor now has his own in -house diagnostics for his own patients.
stevenmc: Yep.
Daniel Sage: He doesn't resemble a neurologist. he He's now an informed decision maker because he gets the results of a diagnostic test and says, you know what? The nerve is not that bad. You don't need a surgeon to go to therapy or it's bad. You don't need therapy to go to this guy. So they become more informed when they make a referral
stevenmc: Yep.
Daniel Sage: And by the way, they're billing and collecting $400 or $500 an hour, paying us cash at $250 an hour. So the doctor's making a spread of $300 an hour for what I provided him. I'm paying the PT $60, $70 an hour. I make $100 and everybody wins. It's like it's a it's it's a no brainer.
stevenmc: Yep.
stevenmc: I i love ah love that. And based on on what you're telling me, I would have to to completely agree. And it's it's it's what we shoot for at at Sarah as well. like There are enough things that are taking money out of PT's pockets. We are not we are not one of them.
Daniel Sage: Right.
stevenmc: And we'll never be one of them. And and making it a no -brainer. right like Especially, I think, for for what Hands -On Diagnostics provides is
Daniel Sage: Mm -hmm.
stevenmc: Like not only, yes, the the reimbursement and the better outcomes, but also like as a PT, I gotta imagine you hear quite a bit, like you're giving me agency back for my career, right? And like yeah think and that that in that mindset shift. i
Daniel Sage: I mean, like, even like when you and I spoke from what you guys do at Sarah health, you know, we spoke, I mean, I mean, what was it like you can make like three, four or $5 more a visit? Was that what it was that we were talking about?
stevenmc: Well, like five or six five or six is about the average that we see.
Daniel Sage: Yeah, I mean, I'll tell you what, and I think I mentioned to you that our partnership dropped humanity nationwide.
stevenmc: Yeah.
stevenmc: Yep.
Daniel Sage: I'll tell you what, if we were able to make $5 more a visit, maybe they wouldn't have done that. and and And in terms of what you guys do with patient engagement, so again, same thing. What's the purpose? Well, the better patient engagement between the therapist and the patient, um it's a value -added service. Oh, and on top of it, I can make $5 more a visit? Okay, let's go. I mean, its just it makes perfect sense.
stevenmc: Yeah, but I think a theme that has run through this conversation is you really do, as you think about any sort of innovation within this space, you do have to think of it in more than just one lens, right? You need to think, okay, what are the patient outcomes? What is my impact to staff, right? You can split that into clinical, non -clinical, and then what is the impact of the practice? and But I think you do it in that order, and you end up in a really good spot at the end, and I know
Daniel Sage: yeah
stevenmc: for For us, like, okay, the outcomes have to be better. Let's go prove it. And so we did a study to be able to see like, okay, what happens? Like, Oh, all right. The patients on Sarah got to a 14 point better functional outcome based on the the photo score than the control group. Okay. That's great. they did in 2 .3 fewer visits.
Daniel Sage: Yeah.
stevenmc: Okay, well well, that's fantastic. And a $47 per episode margin increase for the for the practice.
Daniel Sage: Bingo. Yeah.
stevenmc: Bing, bing, bing. How often do you want to play this game?
Daniel Sage: yeah yeah.
stevenmc: um And and that's it seems like you ah you have done that similar framework of patience, staff, practice,
Daniel Sage: it's happening.
stevenmc: made sure it works across all three, but you go through it in that way and you really end up with something that's valuable to everybody.
Daniel Sage: hmm.
stevenmc: And then it doesn't become a flavor of the week thing. It's like, Oh, no, this is just part of our DNA now.
Daniel Sage: Let's see if it's what we do, yeah.
stevenmc: because thererefore Yeah.
Daniel Sage: Well, I think too, also, because we put remote ah therapeutic monitoring, you know, when I was in practice in that you guys do, because we need to scrape every penny. We need to figure out how are we increasing value and is it good for the patient, but I can tell you this.
stevenmc: Yeah.
Daniel Sage: There are practices and owners that don't do something like that or they don't look at diagnostics because they're complacent. They want to stay in their lane. They don't want to disrupt something. You know, oh, that's another thing. I'm working on an EMR now. Now's not the right time. I'll tell you what, when is is the right time when you're at the bottom of the of the ladder? when when you're when you're When you're completely you know on your back? No, because complacency equals depth. If you're not expanding and changing and forward thinking, you're shrinking.
Daniel Sage: And things like what you're doing, what we're doing, practice owners, it's a must because if you think
stevenmc: Yeah.
Daniel Sage: If you think you're going to do the same thing and trying to renegotiate contracts. Okay. Maybe, I mean, I know cases where the insurance carrier pays a little bit more this year and guess what? Next year they take it all back. They cut it. They did it with my buddies practice in Buffalo.
stevenmc: Whoa.
Daniel Sage: They gave him like a 25 % increase a year later. They got rid of it. I mean, that's that, you know, those kinds of things. We're putting control in the hands of the insurance carrier.
stevenmc: Yep.
Daniel Sage: Okay. And I get that. they're paying us. But the more that I diversify in Sarah health, hands on diagnostics, if again, it fits the right model, why it's better outcomes, better patient care, increased reimbursement, no brainer. So the owners today, the owners today, the the ones that are innovating forward thinking, thinking outside the box,
stevenmc: Yep.
Daniel Sage: willing to take a chance are gonna be the ones that flourish and prosper. And the ones that aren't are gonna be the ones that are slaves to their practice and have no freedom of time and no freedom of money.
stevenmc: Oh, freedom of time. That is a as a magic. That's such a good phrase to use too, Daniel. I appreciate you saying that in particular writing.
Daniel Sage: Yeah.
stevenmc: And I think it it reminds me of a quote from a book I'm reading right now called Arete by Brian Johnson, which I suggest to everybody. It's it's fantastic. Is an ounce of discomfort today is immensely, immensely better to swallow than a pound of regret tomorrow.
Daniel Sage: Exactly.
stevenmc: And that ounce turns into a pound.
Daniel Sage: That's so true.
stevenmc: It turns probably turns into a ton, right? And ah just don't don't let that happen. ah Don't let that happen.
Daniel Sage: Yep. Yep. Yep. Yep. That's so true. That's very true.
stevenmc: well I know we're about up on on time, Daniel.
Daniel Sage: Yep.
stevenmc: It's been a fantastic conversation.
Daniel Sage: Yeah, I appreciate it, man.
stevenmc: So I'm not surprised based on on how fun we our conversations have been in person.
Daniel Sage: Yeah.
stevenmc: ah if If you could leave our or folks with, you know as you think back to, I think put yourself back in your shoes in 2013. I'm like, okay, we need to do something different and and I need to innovate in some way. and what What advice would you have either A, given yourself now that you've been all the way through it, or B, even you know what what would you what would you say you did right? What mindset? you it Just a piece of advice for for our listeners.
Daniel Sage: I believed in myself. I believed in taking risk. I believe I was passionate. I'm still passionate about what I have to give. I believe that I can make things go right. I believe that I can expand my business. I believe that taking calculated risk and feeling nervous about it and a little worried is okay. because I believed in me. I believed in what I could do. So for the practice owners that are out there, you just gotta, you know, you gotta grant yourself the acknowledge that it's okay to feel concerned. Oh, if I do this, what if? But the more that we sit back and take a passive role, we're gonna get crushed. So being able to take calculated risks that make sense, but believe in yourself and taking good risk
Daniel Sage: that is healthy for the business is a good thing. So it's being complacent and staying in the lane, that is not good. Because it just introverts the owner, they get stuck into practice, taking calculated risk, believing in who you are and having the resources around you, go for it.
stevenmc: You know, I'm going to say something. I'd be curious to see if a few would agree to the summary. What do you want to be? Do you want to be absolutely perfect and great at dying or you just want to be good at growing?
Daniel Sage: Yep. Oh yeah.
stevenmc: I'd rather be good at growing.
Daniel Sage: No question about it. Yep. Oh yeah. No question about it. And that, and that's my, that's my passion now. I'm i'm going to continue to communicate with practice owners, help them to the best of my ability, but really help them think that it's okay to take a chance. It's okay to take some risk. If it makes sense, you'll be successful. Go for it. Go for it.
stevenmc: Absolutely, absolutely. Well, Daniel, thank you so much for the time today.
Daniel Sage: Yeah, man.
stevenmc: I really appreciate it. I think that you've given some really tactical pieces of of advice to our folks, which is always the goal to make make innovation you one little bit, iota, more accessible.
Daniel Sage: Come on. Yeah.
stevenmc: And I think you've achieved that in spades today.
Daniel Sage: Yeah. Awesome.
stevenmc: So with that, thank you very much for joining me. I appreciate it.
Daniel Sage: Pleasure. Thanks, Stephen. Talk to you soon. much
