The Business of Better Care: Using AI to Empower Providers and Patients with Dr. Josh Funk

Heath Fletcher (00:13)
Hello again, welcome to another episode of The Healthy Enterprise. Today you're gonna get to meet Dr. Funk. Josh is a physical therapist and CEO. His company Rehab to Perform has been growing over the last 10 years to an astounding 11 locations in the Maryland area and about 100 team members delivering services to patients in the rehab space. He's got a cool story and I can't wait to share it with you. Let's get started.

Dr. Funk, thanks for being on this episode. I'm gonna call you Josh, but I wanted to start with Dr. Funk, because it's a great name. So welcome and thanks for ⁓ being part of the episode.

Dr. Josh Funk (00:58)
Heath, happy to be connected here and to obviously have the ability to share a conversation, share my stories with you and the healthy enterprise.

Heath Fletcher (01:07)
Great. ⁓ So first thing I want to hear from you is your story, you know, how you got to where you are and also sort of the how you, ⁓ rehab to perform came to be.

Dr. Josh Funk (01:22)
Yeah, I think it was kind a mix of things. ⁓ You know, I grew up in a household with a lot of activity. We played a ton of sports growing up. You know, we're always ⁓ told to try new things, different season, different sport. You pair that with a focus on academics and you automatically are thinking of the phrase student athlete. So, you know, that takes me to high school playing three sports. I choose one sport in college.

And that happened to be lacrosse, played lacrosse at Ohio State. And that was when I think really this whole thing kind of, ⁓ you know, starts from a timeline standpoint as it relates to my career, my profession and what I'm doing now. But having an injury, being in a college athletics environment and actually really, really enjoying the process, really enjoying the people, really enjoying the environment. I'm still feeling connected to teammates and what was going on. ⁓ Always being able to feel still capable.

while understanding what I needed to do from a competency and capacity standpoint. I was able to play my entire season with the torn labrum. I actually got to avoid surgery, went home for the summer, and then I got the exact opposite from a healthcare experience stair point. Very older, traditional place, faded carpet, worked with somebody younger than me that had a clipboard with a sheet that I saw another individual that clearly was not playing college lacrosse going through.

I somebody that didn't know how to communicate to me about my summer workout packet. ⁓ Overall, wrong place. It felt more of like a have to as opposed to a get to experience. And as I would commonly refer to it now, it was a grudge purchase. So for me, that kind of got the wheels turning. You combine that with an affinity for fitness, you know, some small bouts of entrepreneurship, whether it was the paper boy or mowing lawns or doing swim or lacrosse lessons with people in the neighborhood.

And you kind of had this perfect storm where my trajectory after that was pretty much dead set on starting what I'm doing now, which after a decade now of business, I can say was a good choice. But I am the CEO and founder of Rehab to Perform, multi-location physical therapy practice with about 72, 73 practitioners across 11, soon to be 12 locations in what is known as the DMV, the DC.

Maryland Virginia area.

Heath Fletcher (03:48)
Right. And so how many locations are you saying? 11. All right. Okay. So what made you, uh, make the crazy decision to go from having, I mean, some people are kind of like, well, one business is enough, but you have literally 11 businesses you're running in separate locations, separate staff, separate, uh, facilities. So what inspired you to grow it to that extent?

Dr. Josh Funk (03:51)
11 soon to be 12

We started in a satellite location at a place. It was like an indoor sports center. We were in between two turf fields Very low barrier to entry we got to use the equipment right outside Share it with a group of personal trainers, you know Not having to pay for equipment not having to pay for the run of turf that they allowed us to use Just having to pay for our little space Quickly outgrew that within about 18 months, you know, there's three practitioners there. We outgrew it We're able to go get our own

⁓ Our own brick and mortar no longer a satellite startup location our place you walk in you control everything ⁓ Obviously paying for your own equipment in charge of the flow of the facility everything aesthetically ⁓ visually auditory ⁓ You know whether control the whole brand experience and then quickly in the middle of a you know five plus five lease so potentially a ten-year lease ⁓ You sit there and you're like, all right. Well, we are

12, 18, 24 months now into this new lease and our brick and mortar. And my gosh, we have six practitioners. We have two more than we thought we would be able to have at this office. And look how much time we have left potentially on the lease. Maybe we have something here. And that was where I started to learn a little bit more about ⁓ business expansion. Never really had registered on my mind before then. And I actually went to a franchise convention conference.

the iFranchise was up in New York and learned how to replicate a business. lot of SOPs, standard operating procedures, cheat sheets, things to make a more process oriented business. ⁓ And despite best efforts, it's still ⁓ really challenging, but we always want to think like a franchise, but operate it like it's mom and pop. You know, want to have that community connectivity.

You want to have that authentic grassroots feel with the people, knowing what's going on in the world around them ⁓ and not being in a situation where it's too much like a treadmill, but also having a certain amount of order that it's not chaotic. And you mentioned separate businesses, but putting touch points together to make sure that you have a synergistic staff and it's not siloed. And there is kind of a common theme and a ⁓ common energy surrounding the mission, vision and core values of the company.

Heath Fletcher (06:38)
Right. That's easier said than done. mean, having multiple locations, multiple staff, I mean, you can only be in one place at one time. And so I think that's what a lot of business owners struggle with is that ability to replicate yourself more or less is replicating a culture and a vision and a mission. And how do you achieve that? from your standpoint as a leader of this organization, how do you infuse your vision

into other people so that you can continue doing what you're doing because you still ⁓ see patients,

Dr. Josh Funk (07:13)
Uh, I kind of go through like last week, just wra football clients and a W. the camp now. Um, I w periods of time right now take on, you know, higher athletes from our area. college athletes as they c weeks, but it's a

Seeing 40 hours of patience, the business probably isn't going much of anywhere. I got to work on the business. It's appreciate thing, but work on versus them.

Heath Fletcher (07:45)
You got to focus your.

But still, somehow you've managed, what leadership skills are you infusing in, are you using to infuse your culture and your vision in all these locations? Is there something you're doing that you can tap into or?

Dr. Josh Funk (08:04)
I

think big things first and foremost are having a certain amount of transparency about what matters. And you have to be transparent with people on the front end. So you have to lead with mission, you have to lead with vision, you have to lead with core values. You got to make sure that's part of the onboarding material. You got to make sure it's regularly referenced when discussing certain concepts. ⁓ And then ideally you have to hire well. So you have to hire people that ⁓ you feel largely through conversations are aligned with you, that are in a situation where

⁓ If I take feedback as a gift on offense at all times, some of these little things that we're talking about on a regular basis, they're an embodiment of that. ⁓ And you ideally have people that then you do a good job of talent recognition where you get younger individuals, there's upward mobility in the company and people see who and what gets rewarded. So if you have a reward structure such that

people who are embodying the culture, embodying the mission, vision, and core values are moving their way up than individuals that join the company. I don't want to say that they don't have a choice, but it's kind of indirectly they don't have a choice to really kind of fall in line. And you get also much better at recognizing sometimes when people get through an interview process if they're not the right fit. And it is a little bit time relevant, got to a situation where we have somebody leaving us this Friday.

just wasn't the right fit, you know? And you make sure that you make decisions like that because you are trying to, as we say, we want to protect the brand. ⁓ That's important for us, not just with our colleagues or coworkers, but with interns. We have a very, very robust internship program. What are we doing to protect the brand there? Our brand potentially is attached with partnerships and stuff like that. So if it's ⁓ used by other individuals outside of our company or other companies outside of our company.

How are we making sure that we're protective of that as well? How is that brand showing up? How is it being communicated? Who are we aligning ourselves with? Those are all things that I think kind of play into that bigger discussion of, you know, protect the brand, which really, ⁓ you know, I think runs hand in hand with ensuring that you've cemented culture ⁓ that stays consistent across locations. ⁓ And despite you adding people, stays relatively the same.

Heath Fletcher (10:30)
And that at the recruitment process, are you actively involved in that? Like, is that something that you do like to participate in and be sort of present for?

Dr. Josh Funk (10:40)
I would say I'm more involved in discussions. Sometimes I'm involved in superficial ⁓ conversations early on. I'm not involved nearly as much and I had a conversation about this this morning. I've been involved in putting together a hiring guide. I'm involved in kind of determining what we might need, but I'm not involved as much in the interviewing and the shadowing process. I am more involved in what I would consider internal interviewing or internal recruitment where when we get these people in, now,

as we keep growing and other positions of leadership or of social media engagement or teaching in the company are ⁓ being chosen upon, am I doing a good job at recognizing who we have in the room and then creating a pathway for those individuals? So I'd say, exactly, like I'm almost more involved in the retention side of things as opposed to the attracting of net new. Now I'm contributing to the whole ecosystem.

Heath Fletcher (11:29)
career development plans.

Dr. Josh Funk (11:39)
and ensuring that we are attractive ⁓ to people, but the exact process and procedural side of the interview, the shadowing and all of those things, I would say I'm more superficially involved in and I help kind of construct the guide, so to speak.

Heath Fletcher (11:56)
Right. And retention, I mean, that's a critical pathway. mean, that's really, once you find people, sometimes the hard part is retaining them. You get them, they get there, they start working, they get settled, but there's something that's not holding them there. think you're wise to invest in retention. And you talked about reward earlier on. what

know, when you're talking about reward and retention and that structure, what are you doing to provide that? Like, what is it? And you also talked about bringing on a younger staff. you have to do you find that the reward or the retention process is different for different generations?

Dr. Josh Funk (12:37)
Yeah, I'd say we're mostly, I think it's almost 90 % millennial in Gen Z. So we have a very, very young team. When I think of ways that will contribute to retention, A, first and foremost, is who you say you are, what you are. So when people come into the company ecosystem, is it everything that you promised to them? Or were there certain things that were promised that are just a mismatch with what is actually provided to

Then you're probably talking about a situation where do the people see the company improving? Right is the company making change or is it static? We are just over a hundred total people, you know as I mentioned 70 some clinicians Have we become big cruise ship or do we still have the agility to change? What's going on for a company standpoint? Are you offering people different PTO benefits? compensation bonuses Is there some kind of rewards or challenge program? Is there some kind of?

bonus program. And then you're talking about finding pathways where people can mix up and have some variety of what they're doing and what they're contributing. Am I more than just seeing patients? Some people just like to see patients. Some people don't want to see just patients. Some people want to contribute to teaching. Some people want to contribute to leadership. Some people want to contribute to social media. So how can we start to give them a little bit more of a hybrid work structure that they view?

view that cognitive variability as being something that fills a box for them. As we add locations, are they in a leadership role in a profit sharing situation? Is that potentially something, especially when we talk about student loan debt, that is appealing to them? But are they willing to put in the time and energy and the sweat equity to have kind of these golden handcuffs where we're in it together, we're providing you the playbook, you're not a franchisee, but you kind of are with regards to...

the benefits and the upside eventually once we get this office, ⁓ you know, completely out of the red. So, you know, there's different options, different tracks. I think that is extremely important. And the most important thing in all of this is having listening mechanisms or feedback loops. Because if you don't listen and you're not able to take in feedback from your team, you probably have a harder time ⁓ creating a situation

where you can pull people in to certain tracks, because you don't understand them. You don't know them. You don't know what's going on. You don't know what the pain points are. You don't know what people are listening to. So that's been something that I think has been very, very important for us, making sure we have a wide variety of different listening mechanisms to get feedback. And in those situations, it makes my job a lot easier, because I'm not trying to think about everything on my own, just wondering. I can go straight to a feedback form or straight to a person and just have a better idea of who...

you know, the younger individual in our company is working towards being.

Heath Fletcher (15:33)
Right. so your understanding is that what are they looking for as far as a way to make their work life better or improve upon so that you can provide that. Yeah.

Dr. Josh Funk (15:43)
One

of the most important questions I people ask in the hiring guide is, do you know where you want to be a year from today? If you know where you want to be a year from today, the company can provide you with resources, right? But if you have no directionality, at least movement, it becomes tough. Then you have a static individual, you just might have an individual that never really finds true alignment within the company ecosystem, and it becomes harder. I forgot who said it today, but companies are paying you to learn.

and companies are paying you actually get better. And if you can get better and you can pair that with ⁓ objectives from the company, it can be an easy win-win for both of you. But if you don't know where you want to be and you're a static data point as opposed to an arrow, ⁓ it becomes a little bit more challenging. You're just kind of sitting there. The world's moving on around you. The company's trying to move in a direction. And people can all point to the person in a group project who largely doesn't look like they're contributing to a ton.

Heath Fletcher (16:41)
So not that you make it sound easy, but you make it sound like you've thought this through, you've been, you've obviously deployed this system over and over again, 11 times. But, ⁓ you know, it's helpful to know for some people is, ⁓ you know, what, what keeps you up at night or what used to keep you up at night. If nothing keeps you up at night now, what does, or what used to, you know, what were your sort of your largest challenges during this whole experience?

Dr. Josh Funk (17:07)
I almost want to break it into three phases. think early on, the things that kept me up at night was knowing that I didn't know a lot. And I think that ⁓ you would be wondering what the next surprise was going to be. ⁓ What am I going to get surprised by?

Heath Fletcher (17:24)
There's

no shortness of surprises in building your own business.

Dr. Josh Funk (17:29)
Absolutely, absolutely. And I was feeling like stuff was sneaking up behind me, right? And you were just waiting for like you to get hit on the back of the head and oh now I need to pay attention to that.

Heath Fletcher (17:37)
Yeah, there's no warning lights or signals, no.

Dr. Josh Funk (17:40)
Exactly. Then you get to a certain point where you're like, all right, we open up our third office. It's easier than the second one. Second one was a disaster. I always will say the second location is probably going to be your hardest because you realize how people dependent you are in number one and you realize how process dependent you need to be in number two. Then you start to put the two pieces together. Three gets easier. So we start to figure out what we're doing, but then the pandemic hits. And then that's one of those situations where you have more constraints than you've ever

dealt with, so then you almost have to be ⁓ agile and creative with regards to what you're allocating time and energy to, ⁓ how you're approaching finances, how you're approaching staffing. In the most constraint ⁓ driven, I think you probably could ever, from a service delivery standpoint, I can't think of a situation you would have more constraints on your business. So you're forced to do certain things and forced learning.

As opposed to in the beginning, you're learning just reactively. So there's reactive learning, then there's forced learning. And now the part that we're in right now, I'd say is just proactive learning. Like we know where we still, and I'll use a sporting analogy, like we're still playing on Thursdays. Like we're a JV team. Like we are still working on certain things and we go, how the heck did we get this far? And we are literally playing on Thursdays in this topic, in this category and whatever. Like think how much better we could be.

If we got to a point where playing on Friday, playing on Saturday, obviously I'm using a football analogy. The proactive learning side is fun because it allows you to map things and you get to have like ⁓ an adoption map ⁓ or a quarterly map of these things and you're able to chunk it and plan for it. You have a cadence for it. You're able to resource it on your own terms as opposed to that.

Heath Fletcher (19:09)
Bye. ⁓

Dr. Josh Funk (19:32)
that forced part or that reactive part early on where, I mean, reactive, it's chaotic. You're learning because you absolutely have to to just keep your business up and running. You're forced to do certain things in a constraint-oriented environment with the pandemic because you have no choice. So you're like, only can focus on X, Y, and Z. And now the proactive side is very, very fun because quite honestly, we're starting to see just massive changes in overall, I think, our confidence.

that we're not just gonna be a decade business, we wanna be a two decade business, a three decade business. ⁓ And by doing these things, we make our lives easier, we make it easier to grow, easier for everybody to operate in the ecosystem. And ideally, we wanna position ourselves as a regional giant. And that's where we're focused on right now.

Heath Fletcher (20:20)
Going back to COVID quickly, how did you survive that? What were some of the ways that, what were some of the things you implemented that helped?

Dr. Josh Funk (20:28)
Yeah, I mean that forced me out of patient care when you can't share between offices because if somebody gets sick at one office and you're in overlap, I pulled myself completely out. People didn't see me. And if an office got sick, then I could potentially go into an office and see people because I hadn't interacted with anybody. ⁓ But that forced me to then work on the business. I got so much better at our numbers.

⁓ We got a lot more focused on digital marketing, direct mailers, because people were home. So they were in front of their computer more, and they also were just getting the mail more often. We were a very, very big, cold outreach, warm connectivity business early on. Very, very people-centric. Handshaking a smile was how we got things up and running. Now we learned how to do other things, because we couldn't handshake and a smile. There were no events. We had to do online workshops.

We got better at things that we just hadn't even touched from a marketing standpoint. I got so much better at internal comms. Internal comms with our team, internal comms with patients. Before that, I'd never really learned. You hear communications, you're like, okay, I get it, cool. We started having internal newsletters, we created Slack channels. There was all these things that we had ⁓ that were both patient-facing and team-facing that got better. ⁓ And I think overall, you know, ⁓

You're also talking about probably the period where we buckled down. said, we're not seeing as many patients. We're to build out this robust internship program because at some point that is going to be such a talent pipeline for us. And there's no better time than right now just to work on it. We can sit in our hands or we can build for the future. Keep thinking about where the business needs to be when the pandemic is done. So being future thinking, ⁓ know, unfortunately you have to furlough a couple of people.

out there trying to figure out what you can make do with from a financing standpoint. ⁓ And every day there is just something new that you're navigating around. And the hardest part about being a multi-location business is different rules in different places. So that was a whole separate can of worms too. But I think at the end of the day, it forced us to do things that we had never done before, or it forced us to focus on things that we talked about.

that we were like, there's no better time than right now to be doing this thing because guess what? We don't have as many bodies coming through the door. Well, if you all wanna work and you wanna keep your paycheck, here's what we're doing. You're turning into an internship development person or you're learning about this or you're learning about that. ⁓ So it ⁓ was an interesting and fun time and overall, I think it made us better.

Heath Fletcher (23:11)
Yeah. Well, you either get better or you go home in this situation like that, right? You either pack it up or you just learn to adjust. it's interesting how, you know, I don't get tired of hearing the COVID recovery stories, you know, where it's like, how did you make it through? You know I mean? That's a very unique situation that no other sector of, no other.

generation has had to experience, right? It's just a unique experience. So it's very cool. You talked about, mean, a process is an important component for you because you have all the locations and you develop that. you ever run into over process? you have you run into situations where it's like, I've over processed this, too mechanical now.

Dr. Josh Funk (24:01)
I think the only thing that you could potentially over process is genuine ⁓ connection, which I think you provide people with certain things they need to have taken care of in conversation, but you don't want to make conversation too rigid. I think the biggest ⁓ expression of ourselves comes through nonverbal and verbal body language. There are certain things from a nonverbal body language standpoint that we can do to disconnect.

to make somebody feel disengaged. There are certain things that we could say that could be counterproductive to what we are trying to accomplish. So you have enough rules to pull things off the table, but you're not too rigid with regards to saying, these are the outcomes and here's the way that we want you to approach this, fill in the blanks here. And I think that part is why we should be over-processed because again, the communication side allows us to

Heath Fletcher (24:53)
where you create-

Dr. Josh Funk (25:00)
connect to align with somebody to make them feel comfortable that they're being taken care of, they're being heard, they're being listened to, their experiences, what they want to get to a point where they're doing, what's working well, what's not working well, what they like, what they don't like. And through that, if we are too AI agent-ish, ⁓ it could be a negative. The human component there ⁓ will allow somebody to come back ⁓ again. ⁓

I use the word alignment. ⁓ But if you over process that, it might be harder to have alignment with that person because they feel like you're just going through the motions and checking boxes. We can go through the motions with a lot. We can do that paperwork. We can do payment. We can do insurance verification. are certain things that need to be very, very cut and dry and kind of in the background, so to speak. that human component is so key just to have enough framework, enough things off the table.

you would have an idea of what the outcome should be. And then ideally we're, we're treaking and trialing, especially knowing the fact that every human being we interact with is different.

Heath Fletcher (26:07)
Well, it makes sense because you are working in a human patient-centered environment where it's all about human outcome. I guess if you didn't have that balance, that's your focus is your patients. If you didn't have that same sort of methodology or value on the inside between each other as team members, ⁓ kind of speaks to your background in sports and team leadership and everything like that. So that's cool.

Dr. Josh Funk (26:36)
And I think to piggyback on an earlier conversation too, it's we want to provide people with direction. At the end of the day, the direction for every patient is going to be slightly different. Some things are going to be straight lines. Some things are going to kind of zig and zag a little bit, but we know that the direction is that way. That's the way that we're working in. There are different ways to take steps forward. There are different ways to approach bridges, ⁓ complete blocks on the road, speed bumps, et cetera. Here are the resources that we have that we think will allow you.

to individualize the scenario and again, not be like a robot.

Heath Fletcher (27:10)
Right. And so how are you delivering your services? mean, you're in a competitive space. So how are you delivering your services that are different than what other people are doing in your area?

Dr. Josh Funk (27:22)
I think a big thing is going to be the focus on movement. I know that's very simple, people, movement, physical therapy. ⁓ When I experienced it, and I think still people to this day, the narrative is largely surrounding pain. It's not to minimize pain, it's not to minimize what somebody is feeling, but if we only focus on somebody is feeling, we might not build a more robust individual and an individual who might not experience

that same situation again. We have to focus on movement competency. We have to focus on capacity and really individuals overall capability. An individual who has a higher capability is less likely to potentially encounter scenarios of which their body does not serve them or potentially fails. ⁓

Heath Fletcher (28:10)
You

can't actually do the things you're used to doing and you're basically not able anymore to do your regular activities,

Dr. Josh Funk (28:18)
Exactly, and we want to create a certain level of efficiency in a body so somebody can continue to do the things that they like doing, they love doing, or potentially at the professional level that they have to do to continue moving. If we just focus on that symptom, rest might be the best thing that I offer you. However, we know rest doesn't exactly build tissues. It doesn't build tissues to be more capable to be able to do that thing over and over again. So pain is something here, it's a symptom, but not to...

kind of beat a dead horse with regards to the healthcare system, if we have a symptom-based approach and too much of a medical model focused approach, as opposed to an overall wellness based approach, where we are helping an individual create a new and better baseline, we might be selling themselves short. So we've largely focused on that in an environment that looks like a gym, which is largely a situation that most people would say they enjoy going to more often than going to a healthcare facility. Exactly. And then you have people that are armed,

Heath Fletcher (29:12)
in a medical facility,

Dr. Josh Funk (29:17)
from a language standpoint to have productive conversations with people, to connect with them, to ideally allow that individual to feel heard and listened to, and ideally feel like they're in the right place. So we always say it's a mix of the education of the staff, it's a mix of the environment, and then the outcomes we're looking to achieve. We really feel like those are our big three differentiating factors that will allow people to continue, you know, in our world have

Amazing experiences, ideal outcomes, great Google reviews, great word of mouth with regards to obviously the referral report. And for a lot of businesses, Net Promoter Score is a pretty important number and we feel like we're doing a nice job with our world-class metrics there.

Heath Fletcher (30:03)
And, ⁓ in some ways you're actually helping people avoid things like surgery. ⁓ but in some cases you're probably actually seeing people who have had surgery and they are in a recovery process as well. Right. So you're kind of, you can be helping people on both ends of that scale. Yeah.

Dr. Josh Funk (30:19)
If you had surgery, we'd love to make sure that this is your first and only. We would love to make sure that we approach this process very well. Much like a school curriculum, we want to take you through a curriculum of capability, right? We want to take you through the elementary, rudimentary activities early on after surgery. We want to get to that middle school level. We want to get to that high school and college level so that you have the confidence to do all of the things that you used to do. You know, we don't want to have these

potentially like fear avoidance behaviors because you feel less capable than before surgery. Ideally, we might even create a new baseline for you. And then in a situation where somebody does have an injury or ailment and they want to avoid surgery, again, we focus on the capability part. Taking it back to my personal experience, I had a labrum tear. What did I do? Well, I didn't change the fact that my labrum was torn. The tissues might've gone like this, but they do heal in between there. And then at some point,

We talk about the active tissues. I'm building muscle, I'm building tendon, I'm building the relationship or the connectivity between my nervous system and those active structures. And ideally I have a shoulder that's incredibly capable that ideally doesn't have to potentially have a signal go off saying, hey, warning, caution, which if we oversimplify pain, could be that particular situation where your body, because it's less capable, go, don't do those things. I'm gonna give you pain when you try these things.

Instead, you move forward and your body goes, I can handle this. I don't even have to worry. I'm not even thinking about the labrum. I can turn that signal down maybe a little bit or maybe ideally entirely.

Heath Fletcher (31:57)
And most of us can relate to having some sort of um disablement whether it's an injury or you know something that we've done to our knee or elbow, arm, shoulder, whatever falling down or whatever it is. But if those of us that have actually gone through the process of seeing somebody about outcome, my experience has always been that there is uh the knowledge that comes from the practitioners saying, okay, here's what you've done. Here's how we are going to repair it. The participation level of

your patients is as important as the information you're giving them, right? Or it's only as important as the information you're giving them if they're willing to do the work themselves. your sounds like your facility is more conducive for that, where people can come there, work, work out or work through their therapy that they're working with with you and an environment where it seems like, ⁓ this is a place to grow and, and, and repair. But how important is that?

process of having patients participate in their recovery.

Dr. Josh Funk (32:58)
Being active participants, we feel is a significant part of not just our area of healthcare, but any area of healthcare. ⁓ And the best thing that we can do is make sure that the facility is designed in a way that it mirrors a lot of places that they might interact with out here, or sometimes even putting them in a position where they're just using their body weight. ⁓ But you are trying to have that individual, ⁓ A, understand

why whatever they're doing is important, B, what the potential carryover is or how this plays into their recovery process. ⁓ Ideally not put them in a situation where you're talking over their head with too much medical jargon or medical terms, giving them too much complicated exercises that they can't potentially match or mirror that outside of the clinic or giving them too many things that they view as being time burdensome. So you could be intellectually burdensome for them.

you could also be time burdensome for them. So you're trying to meet them where they're at. And that's that listening component. I mentioned earlier with our staff, but it's equally, if not more important to be listening to that patient and ideally setting them up for success, but getting to know them, getting to know their story, their history, what they like, what they don't like, pairing that with your environment. ⁓ And then that becomes a special ⁓ blend where if we use the word homework, because I mentioned curriculum earlier,

I'm giving you homework and you mentioned your knee Heath, but I'm giving you homework for your knee that you go, I understand why I'm doing this. It's simple to do and it's easy to incorporate in my routine and I'm going to do it because I know that, you know, as a result of all of these things that this individual is operating in my best interest and this is going to be worth my time. Now through those things, you're probably a much more empowered individual because I talked you through the process.

I explained it, I rationalized it, I potentially demonstrated it, I made sure that you were able to demonstrate it. So now you have new levels of competency and now we just have to do the thing more to ideally build out our capacity. And you have an individual that ideally doesn't need you at some point and they're empowered to live a life different as a result of the experience.

Heath Fletcher (35:13)
And moving forward, they've now had an experience where they've avoided the traditional medical process, potentially avoided some sort of surgery or some other treatment. you've given them a whole new way to look at how they move forward the next time they have an injury, which is magnificent. Okay, tell me about growth. What does growth look like for rehab to perform?

Dr. Josh Funk (35:35)
Fortunately, we've been on the Inc 5000 the past five years. It's pretty cool. We double just about every two years. And that's kind of the trajectory we're on right now. We're I think we're 109 % if I took the previous two years. So just over doubling. We are focused on the rule of 3 % each month. If we can do 3 % each month, we will continue to double every two years.

Heath Fletcher (35:40)
Congratulations.

Dr. Josh Funk (36:03)
So that is something internally that we are talking about. ⁓ And, you know, I think ⁓ at the, you know, obviously trying to be transparent, we are largely focused on expanding. ⁓ Top line is going to, you know, if you're focused on top line revenue, you focus on growth, you're going to eat profits. We've had kind of variable profits depending on how years go from a projection standpoint. But I think that we are working towards something bigger. And at some point, you know,

Profits will be fine. Everything will kind of work itself out. But if you want to make an impact and you want to be this regional giant or as we say, quote unquote, run the DMV, ⁓ we realize that there's got to be an investment on our side, especially if we don't want to be in a position where we're giving up equity, giving up operating control, potentially gain finance. So we've largely been bootstrapped with a mix of bank loans, kind of like a hybrid approach. ⁓ And that's allowed us to kind of keep doing the thing on our terms. ⁓

at our pace and our tempo and obviously having a certain amount of quality control at the same time.

Heath Fletcher (37:07)
Yeah, that's important for sure. Are you finding locations and starting them from scratch or are you doing acquisition of existing locations and businesses? ⁓

Dr. Josh Funk (37:19)
Alder Novo

at this point in time. We've all startups. obviously a certain amount of build out costs sometimes. Sometimes you got security deposit. Sometimes it's turnkey. Sometimes you're taking on the build out yourself. Sometimes it's a combo. Equipment costs, obviously a big one. And then, you know, you're going to need a certain amount of operating capital and just burn a little bit as you ramp up your patient visits. So

Heath Fletcher (37:24)
That's great.

Dr. Josh Funk (37:45)
a little bit more capital intensive with regards to a service delivery based business, especially knowing that most of your expenses are going to be in people. ⁓ But overall, feel pretty good about our projections. You learn with every new office, the playbook gets better. Some go better than others do. And ideally as we move forward, you're able to ⁓ make things more and more predictable.

Heath Fletcher (38:07)
How are you navigating the crazy world of marketing right now too?

Dr. Josh Funk (38:12)
You know, I will use the word ecosystem. I'm almost surprised I haven't used it more. ⁓ We have a very, very good marketing ecosystem. And I think that if I talk pre-pandemic and I talk pandemic in person, handshake and a smile, very, good pre-pandemic. After that, very, very good SEO, digital, direct mail, ⁓ all the things that are not handshake and a smile. So I think we've been able to really pair those together.

and have a very, very robust ecosystem ⁓ that allows us to, A, when we go to a new place, focus on net new, because that's almost the number one thing you need to do first. Then have a certain amount of reoccurring, which that's retention. We don't have recurring business, but we will have people reoccur, ideally for different things, not the same thing. And then you wanna have word of mouth. And there's active and passive word of mouth strategies. So if we recognize,

Kind of at the top, it's net new. I need to bring people into the system first. And then I need to have certain strategies for individuals to potentially reoccur, to potentially actively drive word of mouth. And then also as a result of things that we're doing also have passive word of mouth occur. ⁓ Then you have this robust ecosystem that allows you to continually, ⁓ you know, again, have doubling occur every two years, which we feel very good about.

Heath Fletcher (39:37)
Any things coming up in your industry that you think are going to be sort of groundbreaking or ⁓ innovative in your area of expertise?

Dr. Josh Funk (39:48)
I think the biggest thing is I'm very curious to see when we are going to address the overall very, very inflationary environment that is healthcare and the amount of non billable or non-service providers in healthcare that are adding costs to healthcare. If we removed administrators, middle level people and we removed a lot of the administrative burden.

you would be able to decrease costs and actually increase pay to your providers. That sounds like a win for everybody. If provider pay continues to decrease and you're running into a situation where you're having increases for individuals and the outcomes are completely detached, high spending, low outcomes, it looks like a lose-lose for everybody. And I'm especially worried, you know, five to 10 years from now, are you going to have as many people entering

the healthcare market for jobs. Do I want to work there? Especially with the rising student debt ⁓ problems, as well as the entry price of a starter home. ⁓ These are all things that kind of play in. And I do think that we have to find a way to make the interaction with what for a lot of people is either insurance through one of the commercial payers. There's got to be less administrative burden. There's got to be

more money that is able go to your service providers. You've got to remove those people that are just taking money and adding to costs that aren't directly providing a service ⁓ and put people in a situation where then it does become a win-win for all. Because otherwise you have the increased price of education, increased price of a home, and you have a situation where providers are feeling a squeeze with regards to earning potential. You will have less providers.

it will become much more scarce for you to be able to see high quality providers. And you're gonna run into problems where again, you're still gonna have high cost and lower and lower outcomes because there's just not enough people there. So then where does that head? Probably rising chronic disease burden costs. Nobody wants that to be a result.

Heath Fletcher (42:01)
And top that up with a incredibly large aging demographic. Yes. Just layer that on top.

Dr. Josh Funk (42:09)
Absolutely. So I think we have to look at just levels of levels of efficiency, what's needed, what's just bloat. What doesn't need to be happening. I mean, look at like prior authorization, like there's prior authorizations out there and overwhelming majority. It's like 99 point something percent of, you know, requests. They're going to get authorized anyway. Why are we even doing this? Like if anything, allow things to go through. And if you've used something to be not medically necessary or something, you should, you should

do it retro, but you shouldn't be denying somebody care and you should be like, we don't even need those individuals. Why are those people even have jobs? Why do we have PBMs? you probably go into a wide variety of different things associated with, you know, parts of bills that have contributed to the current circumstances, but it is something I'm almost more.

concerned about the direction it's going to go in the next decade, as opposed to maybe being excited about a particular advancement.

Heath Fletcher (43:12)
Good points. Good points, Prodop. How about AI? Are you taking advantage of any AI?

Dr. Josh Funk (43:18)
It's

so cool that you said that Heath. I created an HR assistant bot the other day. I went into chat GPT and I said, how do I create an HR assistant that will remove the need for people to ask HR or the HR email what their benefits are? So I just dropped in a handbook. I've got chat GPT Zapier, Slack, Google docs.

and all they have to do is go in to a Slack channel, ask HR Assistant, ask a question about policy, procedure, benefits, and the bot answers their question immediately.

Heath Fletcher (43:56)
No way you just built this like yesterday

Dr. Josh Funk (43:58)
I

wrote it on Monday. it is, but we're building a marketing assistant. We're building a billing assistant. Wow. we're in somebody the other day and you might know this. many of other day said we are pausing all hiring efforts until we maximize the potential of what's going on with technology. I think of AI and automation as ways where, and I talk about this all the time.

Heath Fletcher (44:03)
We're building. is that going to market?

Dr. Josh Funk (44:28)
I go, if we can generate more revenue per person, everybody gets more money. So if you can figure out a way to use these things and we don't have to hire somebody, there is more money for everybody in the company ecosystem. It's no different than the healthcare discussion I just said, where if I just keep adding more non-billable people or administrators to healthcare, go up. And that's not positive. I don't want to have more personnel costs. I would rather generate more revenue

and have potentially the same proportion, average percentage, but not add any more bodies. If we're 10 million and 15 million and we have the same number of people, I'm sure everybody else is benefiting from that. And I can tell you that they would. So those are conversations that I would like to be having more. So I need people to mess around with the chat GPTs and these things that allowed ⁓ very, very smart machines to...

Ideally help you, support you, make your life easier, do certain things from an automation standpoint, but ideally not put us in a situation where we're having to hire more bodies.

Heath Fletcher (45:36)
Right. Those tools are there for us now to take advantage of. somebody brought this up in another conversation I had, and it was talking about the AI, you know, all this technology, this intelligence that we've created. And it is something like we collectively as a species have created this. This is like our collective knowledge being pulled together. And it's in a place that we can take. It's an opportunity.

not to be feared or not to be, you know, taken advantage of, but to be maximized because it is our collective of of humans. Collective knowledge is brought together in a place where you can find information more accurately and quicker than we ever have in the past and something we could never we can never compete with from that perspective. It's like, yeah, I was talking to a doctor the other day. He's like, AI.

will have already has more knowledge cumulatively than any single ⁓ person with a PhD could ever obtain in in a hundred lifetimes. And you can ask that question and get that answer in a fraction of a second.

Dr. Josh Funk (46:52)
Doesn't it change the discussion about education as a whole and how much you should be spending on it? I mean, that's a whole separate conversation.

Heath Fletcher (47:00)
that's another one. Well,

you'll have to come back and we'll talk about that one of these days.

Dr. Josh Funk (47:07)
It's an augmentation and that's how people should view it. It can do everything easier. I just had a financial report that usually takes me a couple hours to go through. I plugged the financial report in ChatGPT. I got a better analysis than I would ever do myself literally in a couple minutes. I was like, unbelievable. Let's say it took me four hours. It took me two minutes.

Heath Fletcher (47:31)
It's so funny because like, crazy, most people's way they see it's like, well, that's cheating. Well, it's like, you like you can write a blog post in like five minutes. Yeah. Well, it's cheating. You didn't actually write it. It's like, well, you have to perceive it as well. What do I, what, what's it for? Anyways, I'm all I'm trying to do is share information. If I can collectively share that information from other people's knowledge, then it's actually going to be better than just my perspective or just what I know. Right. But

Yeah, it's a way to look at

Dr. Josh Funk (48:02)
Make

everything better. should allow us to work smarter, which I think most of us want to work smarter. ⁓ I don't want to have to be doing, mean, imagine this a hundred years ago, I might've just had a storefront and had the only ability to have people know that I was doing physical therapy, be a storefront. That's it. Like, I don't want to go back to those times. Like I'm more than okay having an AI.

Heath Fletcher (48:06)
Modern, not harsh.

The dark ages. So one last question. If you went to bed tonight and you had a problem that you wanted to solve and if you woke up tomorrow it would be fixed, what would it be?

Dr. Josh Funk (48:40)
I would find a way to get the amount of non-billable people in healthcare out of healthcare. I don't have a number on that, but for me, I would love to just say we had a solution there that providers who went to school that incurred large amounts of student loan debt view the ROI on their education, their ROI on time and money as being worth it.

and we're fairly compensated by the healthcare system. But you have non-billable individuals, there's tasks that they have to do that I don't think that they should be doing. And it is overall putting a squeeze on the healthcare system and especially the providers that are trying their best to provide an unbelievable service. ⁓ ideally give patients what they need.

Heath Fletcher (49:32)
Yeah. Great. Great answer. Josh, thank you so much. I really appreciate your time. inspiring conversation. I'm sure you're going to give a lot of people a lot to think about on their journey, ⁓ and in the world of entrepreneur. Is there anything you want to add there? and then wrap it up or, or.

Dr. Josh Funk (49:51)
No, I'm happy to be a

Yeah, I mean, don't be a stranger. I'm happy to be a resource. If you ask me little questions here and there, definitely happy to share things that have worked for me. I can share what didn't work for me. And the only thing that I'll leave in terms of a ⁓ parting phrase, people and companies compete on process. And the quicker you realize that, the quicker you'll probably get where you need to get to. There's a reason why winners win and other people just don't. And it largely is the emphasis on process.

Heath Fletcher (50:20)
Well said. That's the way to end it. Thanks Josh. Have yourself a great week. it. too. We'll talk soon. Okay. That was a great chat. Josh definitely has his finger on ⁓ the growth pulse for rehab to perform. ⁓ It's very methodical, the growth. He's thought it through. He's not trying to fast track it. ⁓

He's leveraging processes, which I think was very smart to approach it from the perspective of a franchise is actually not a bad idea. ⁓ does open the doors for future if that's what he decides to do. But, I think his focus on, ⁓ people retention is also extremely important. ⁓ getting people is one thing, but keeping them is another one entirely. The other cool thing is he's, he's testing out AI, you know, in a way.

He's wanting to leverage that technology to support people as opposed to replace people, which I think is a smart approach. ⁓ And you know, thing that doesn't seem to fade is his passion for his people, not only his patients, but his team. ⁓ I see a lot of success in the rehab to perform future. And it was really great to hear his perspective on the systems.

and changes that he sees are necessary in the future of healthcare. So ⁓ thanks for listening and ⁓ join us again next time for another episode of the Healthy Enterprise and stay healthy.