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The Berman Buzz

EP 2 - ESOPs for Healthcare entities - discussion with SCJ Fiduciary Services

[0:11] Welcome back this is the ESOP guy we are on a journey to an ESOP so for those that are tuning in for the very first time this podcast is really about, helping folks to understand what an employee stock ownership plan is how would it apply to their business. In a lot of different ways there's a lot of things to talk about for Aesop's and so what we do for the podcast is really. Just do topics and different things that I think are helpful for individuals to listen to or really look at to determine you know is it is it the right thing for them so, that's what this podcast is all about if you have an interest in other episodes please go to our website at journey to an And so with all of that I wanted to say thanks thanks for tuning in today we have the opportunity today to explore even deeper one of the questions that we've had, recently is how do esops apply to different types of Industries. And what types of Industries so one of the ones that we're going to cover today is the healthcare industry and to do that I'm going to have the privilege of interviewing both Steve James and Heather Driscoll, and they are representing SJC or scj. [1:22] Scj I screwed up your name scj trustee and so they're going to be helping me really kind of go through this whole topic of Health Care how does an ESOP work for health for the healthcare industry, with a lot of different experience that they have and sharing and how that really looks for companies that are thinking if that's your industry great this is going to be a great podcast for you today so so with that I just want to say again thank you guys for joining today I'm really excited to have you on the podcast, and wanted to kind of start off with just, an overview give us a little bit of a background on how you guys got into Aesop's in the first place and I guess we can start with you Steve if you want to. Yeah good morning Phil and thank you for the opportunity to speak on these Hops and, specifically our journey of scj fiduciary services and particular mind scj fiduciary Services is actually just my initials which is Stephen C James. Just a little bit about myself I'm a recovering CF ocp a 35-year CPA but. [2:28] What in my journey of serving it with small businesses. About 25 years ago I was introduced to a small dental practice that had aspirations of becoming a group that. Small dental practice was called Mortenson Family Dental was founded by dr. owain Mortensen and I had the privilege of being part of that group at its infancy of growth. [2:56] Couple years into my role as the CFO and CEO of the company. I had the opportunity to talk to dr. Morton about succession planning, and why didn't know much about it I'd had some past experience for benefit plans and even the concept of an ESOP but certainly a never done one but with more Contra mortensen's permission, we went on a journey that took us two years which we now believe to be the formation. Of the first Dental Group ESOP in America. And I happen to serve as the trustee for that transaction and of course in those days you could use internally trust trustee done. Individuals and I happen to be the person that Drew the Short Straw of that did that so that was my introduction to esops and much less being a trustee. [3:49] Wow that my colleague Heather Driscoll talk about a little bit that. [3:53] I was really the foundation of how I fell in love with employee ownership what it did specifically for me as a person employee participant, much less what it meant to the organizations in my colleagues that Mortensen so much so that as the trustee I decided that I really wanted to understand what it meant, to be a fiduciary to act with prudence and judgment and after a few years of serving as a trustee for Mortensen I realize that by then is a director an officer an employee as well as the trustee that I was in a shareholder I was when I was more than a little bit conflicted so I've sensed her metal and helping appoint the First Independent trustee for Mortensen. And but that caught the attention of some some local attorneys here in my hometown of Louisville Kentucky and. [4:50] With I guess the urgings of some local attorneys as well as mortensen's founder I started doing some limited trustee work, some 13 years ago and 2008 and was really just a bit of a side light up me and my aspirations were to work for Mortenson for the rest of my career. But because of some things that I'm sure you've talked about it on this podcast bill with the process settlement agreements and. The Department of Labor. Entering into agreements with some trustees the landscape of how Professional Services were offered and E sub transactions specifically trustee Services really changed about 6 or 8 years ago, and in my case that meant for me is a part-time trustee having an opportunity to build a business and because of a number of things. Including my colleague Heather Driscoll here on the line I had the beginnings of a business and with Heather's Direction and inspiration. We built something that actually forced me to make the difficult decision of leaving my row of Mortensen which by then had become a very very large Dental Group some 2,000 employees and. [6:10] An ESOP that was had you know probably 60D 80 billion dollars worth of assets so very very successful but the draw to be a, individual trustee and serving a trustee team much less the clients that we have across the country was, was quite compelling and so about three years ago I left Mortensen. And started scj fiduciary Services SML great so Heather maybe perhaps you could introduce yourself. [6:43] Sure and again thank you for allowing us to be here today always fun to talk about e socks yep specifically in the healthcare space so as Steve shared my name is Heather Driscoll. And I've been a member of Steve's trustee team for a little more than four years now. But our path actually crossed through through Dentistry so I. [7:07] I started out in dentistry probably about 20 years ago really from an operations standpoint. Just helping to lead and guide a single dental practice that I worked with. But It ultimately merged with Mortenson Dental Partners as part of their growth strategy. [7:24] And with that merger really became an opportunity for me to become an employee owner first and foremost but also, really a leader of that organization so I had the great privilege of leading the operations team for the company for a good number of years and one of my responsibilities was to help all of our employee-owners understand, what that meant what are the benefits of employee ownership and how does that translate into exceptional patient care really you know how does the day-to-day decision-making process and, our commitment to our core values and exceptional patient care, ultimately impact the wealth that people are able to build for themselves through their e sub accounts so it's been a really fun Journey my heart is certainly in healthcare love the opportunity. Opportunity really to be able to see employee ownership and Healthcare come together more prominent in which we've seen in the last couple of years yeah I think that's really interesting and thanks for your background on that I would I was thinking about when Steve is talking about the doing it the very first time how being a dental practice you know nobody was thinking about the hey this is a strategy I think that probably took a lot of. [8:44] Vision and guts because now how do you deal with certain challenges that department laborers are going to look at and. Nobody's got a precedent on the valuation for instance and so somebody's going to have to, be able to kind of bite off that I would say the unknowns and so as you guys you know I know that was you know you're doing Steve but as you guys you look at that you know what were what was going in your mind as you went to the holy site process and I know it was different back then and it is now because it was probably a little easier in some ways than an ESOP transaction now. [9:17] Yeah I think it is it's quite honestly was quite a bit easier and in terms of formation and I don't think that the. Right wrong or indifferent the level of presence or concern or the Optics of a transaction or certainly not as front and center as they are today. Much less the fact that while we I think we had. Great intentions in terms of creating the employee trust and creating a benefit the employees I don't think we looked at it at those days in terms of an arm's length transaction like it's expected to be today certainly. [9:55] Valuation was was a. A significant issue back then as it is today for any healthcare related businesses much less closely held businesses is making sure that you have. A proper assessment of value but also good comps if you can find them sand and quite honestly in the healthcare space especially the dental space had at the time and even to some degree now it's but they're hard to find. And so determining what was a fair value was a lot of. A lot of the concern interestingly enough a topic that I became quite familiar with. Over the years but didn't really understand at the time was you know how does a professional service organizations such as Mortensen. How does it become have a non dentist or for that matter any Healthcare professional owner, in our case we went a very very unique path with which I wasn't necessarily advised people to consider and that's actually, we went to the State Attorney General's office and state of Kentucky. To determine if the practice of dentistry and the ownership of a dental practice where the same. [11:12] In our case we were able to get a table ruling from the State Attorney General's office but said they were not mmm that is a very difficult process it took us a long time to be able to secure that opinion. And we're only in one state at the time and I'm working so now is in 10 or 11 states and that methodology simply doesn't work much less large Dental groups or even any type of Health Care in groups, you know you're going to have a professional service acts of each individual state that you're going to have to comply with, so what is what is commonly applied. Is a methodology is setting up a Management Service organization or an MSL where DS o is they call them. And those entities then they still provide the services to the regulated entity. Of a dental practice or a veterinarian practice or a positions group or whatever that might be. Yeah well I want to dig into that a little bit deeper because I think there's that's that's a really big issue when it comes to thinking about. These types of healthcare industry so let me go back to it so when Heather story was about the her role in operations. Your company was already an ESOP company or you or you help them through that process. [12:28] No Mortensen was actually already in well that's what you work for Mortensen got it yeah I did for the number of years and they were probably an ESOP for maybe six or seven years or so when I joined but interestingly enough. What was unique to them is not really it felt unique I guess to me at the time is really a common challenge with employee owned companies. All across the board and what I found was that there was a probably a good amount of excitement and focus put on the ESOP right at its Inception right in the first couple of years lots of attention and. [13:10] The challenge really was when I entered the picture the ESOP had kind of taken a back seat, there wasn't as much Focus or education around the ESOP even though the company was growing really rapidly. What I noticed was that it was really just probably the first 100 people or so maybe a bit more than that who really had the benefit of fully understanding. What it was and why it was important and really what an incredible opportunity it was for them as individuals so one of my responsibilities really was just the ongoing education, also the you know kind of the balancing of helping people understand. Really how value is derived to your point earlier about the valuation well how do you translate that information down to you know Frontline operations in a dental practice or in any company for that matter but the ESOP was was certainly in place and my responsibility was really just helping people too, get to know it understand it and hopefully make it a part of their day-to-day decision-making and really a part of the culture as opposed to an event once a year. [14:22] Nice looks like Steve might have jumped off so hopefully last you for a second there he'll come back on okay that's really good so that kind of sets us up a little bit to talk about. You know when we think about the dental practice is clearly that's a mess that's a Healthcare Company what are some other Healthcare organizations that you would say would be qualified for a Nissan. Sure so we've actually had the great privilege of helping a few Healthcare entities become employee-owned so probably most recently was, psychiatric clinics so mental health arm of healthcare we've actually also worked with some autism centers so really kind of. A niche market there as far as health care goes but we've also had the great privilege of being introduced to you know veterinary clinics who are becoming employee-owned, Physical Therapy groups Eye Centers Optometry. [15:19] Gosh the list probably goes on and on I might be forgetting a few people but it really has kind of started to make its Mark yeah and Heather while you know Aesop's and and Healthcare organizations interestingly enough I'm not always quite sure why this is Phil you probably could, tell us but you know engineering and Architectural firms have been esops for as long as I can remember sure, and their Professional Service organizations but you know other you know Healthcare organizations that are structured a lot like an engineering and Architectural firm in some respects in terms of how they're regulated by the state but you know I think Aesop's in healthcare companies as Heather described they honestly are uniquely. [16:07] They're uniquely fitted to an ESOP because of her things I don't know if you want to talk about that a bit Heather because of the nature of what people do right, the cultures or whatever that might be well I think for so long. Healthcare specifically has reserved ownership for the professional themselves and so that made sense that it makes sense in some situations but the fact of the matter is in in all of the healthcare you know businesses that I've had the great privilege of working with. The people the teams are really the asset it's a bit different you know from like a traditional manufacturing company or something like that where there's inventory and you know equipment and all of those kinds of things that people really are what Drive revenue and experience and ultimately value in an organization so with the ability to you know create Management Services, you know organizations dental service organizations whatever it might be allowing for ownership outside of the regulated you know professional entity. [17:17] Really has opened the door I think from a recruiting standpoint a retention standpoint you know one of the things that I think. It's really important in healthcare is just the consistency of people with consistency of providers and consistency of team members really typically comes consistency and retention of patients and so having that ability. Create a space where not only you know people want to come and stay from a cultural standpoint but from a financial standpoint there's been some really great, great benefit there now I think it's really interesting and I don't think it's the first thing on people's minds when they think about an ESOP company you know as far as the health care, part of it and I like the idea of of why why would it be a good fit so if you think about it like a the psychiatric office the Autism Center. The physical therapy of the vet center. What were their options you know and this is partly what I do and talk to you talking to a new company that's thinking about some type of exit what were their options if it wasn't an ESOP. [18:23] Yeah so quite honestly all those fields much less Dentistry. Interestingly enough they are good business models I would tell you is strategic buyers but in particular private Equity has become a significant buyer and the space. Multiples are quite quite High, and you know as Heather suggested a well-run dental practice which we know quite well and we know psychiatric practice runs the margins are quite honestly above most normal business margins the challenge is that they're highly dependent on people, more so than probably most businesses mean and our business and Mortensen 85% of the operating cost for people hmm and then you had people that were licensed which I think dissuade some people but interestingly enough it doesn't person Wall Street still very interested in it, while there are no publicly traded dental practice I think there will be here probably within the next year again. But I think that's probably as much as anything else, why it hasn't been as prominent and recent memory as it probably should be. What we're seeing now in particular with healthcare companies is while they know they could sell to a strategic buyer or private equity. [19:48] You know a lot of these businesses they want something else and. [19:55] They've never been introduced to a concept of ESOP I would tell you that most. [20:02] CPAs attorneys if they know anything about Aesop's at all they would tell you that it would be very difficult to put together, because of the regulated nature of the industry and I'm here to tell you that's not true yeah but it does take some work yeah and it does take some expertise. To be able to design the structure, mmm but it can be done and has been done yeah you got the very highest level of organization and that's what this podcast is all about because I think there's so many misconceptions with these apps in general but to kind of look at the focus of what we're doing today. Um that's really helpful like and so we're going to we're going to get into a little bit dip more deep you know in terms of like people so people really understand what we're talking about. [20:44] The company itself can't just sell to an ESOP they have to set up these Management Service organizations, because of the licensing or can you explain like the bat part of the challenge a little bit work a that more often than not if that's the case in mortensen's case we didn't have to do it we actually, did I dental practice that was based in and Ohio that's 100% generally shop in fact we think it's the first 100% Dino can only stop in America. [21:13] But in Ohio the the nature of the dental practice act allows for non dentist own that. Entity so in this case here in ESOP being an on Dennis could do it that's a bit of an anomaly right I would tell you in Most states that doesn't exist certainly in your state of Florida if you would have to set up Management Service organization to make it work so I think when in doubt just setting up that structure probably makes the most sense okay. And you know then you need to set you know set up a management service agreement, this compliant with the states that you're doing business in and that's true whether it's a Physician Group at nari and group, psychiatric that's a common theme yeah the the service agreement so let me kind of like walk that out a little bit more. I just step by step so when you set up the Management Service organization pre ESOP we haven't conducted we haven't sold the company to a nice job I've got my shares in a Healthcare Company. Maybe I'm an S corp already I've got stock in that S Corp and then what I'm going to do is I'm going to transfer that stock into the Management Service organization prior to the transaction is that what's happening. [22:29] Because it depends if you could do it that way okay and the case of Mortenson what we did is we concerted we convert it from a PSC to an incorporated entity which allowed us to set up a Management Service organization it was an easier structure to your point Phil what I see most often is that the license dental practice enters into agreement. With a new entity a whole koan called a holding company okay that has a management service agreement in it, and usually the common shareholders of the dental practice which are going to be licensed dentist or licensed Physicians or whatever it might be they're going to become, identical shareholders of that hold, which has the management service agreement and that's usually what we see happen okay got it so that's that's not that complicated really when you think about it it's not I think the complicated thing and these type of structures, is this is probably where you do need an attorney that really does understand, the practice of whatever that Healthcare, profession is in terms of how it is regulated from state to state that's probably the uniqueness and there's not a lot of, law firms that would take you across the country that had that expertise mmm we know them but you know certainly that's that's important but that making sure that that management service agreement complies with. [23:58] The the state laws of those respective States or even multiple States much less making sure that who is employed in where they employed. [24:10] Is legal as well and I guess specifically I can speak to dentist is in some states that NS cannot be employed by an a Management Service organization have to become employed by the dope right. So you just had to work through all those details so if I have a if I have a company that has. Offices in five different states with five different state laws who do I have to comply with. [24:35] What would typically we see happen and Heather I know Heather actually owns dental practice is still so she could probably speak to this probably even more informed manner but what my experience has been as you take the most rigorous state. And you build in a so to comply with the most rigorous State what would you add to that no that's exactly what I would add and interestingly enough. [24:56] You know specifically in these Professional Service organizations msos and Management Services agreements aren't all that, unique they're becoming more prominent really even just outside of Aesop's when you think about even let's just say a physician who wants to ensure that their spouse can continue to own the business if something were to happen to them or the people that work within their organization whether or not they're wanting to become an ESOP you know really creating opportunity for executives who are non licensed in their profession or, you know certainly dentistry's you know closest to our heart but a dental hygienist you know whatever it might be so, the actual thought process or structure of the Management Services agreement. Um has really honestly been around probably longer than its been getting attention because it's served multiple purposes it just so happens it works really well from an ESOP standpoint. Now now interesting says got other benefits to if you have if you're needing to do a nice up it might be just better for the organization to have that. A part of this I think it very much is. [26:08] I was like when I saw I'm not a CPA I remember being becoming a partner in an owner of this business and we had to change our name because. That law was if you have any non CPA owners you have to be now we're Berman Hopkins CPAs and Associates I always tell people I didn't get my name in the title are the The Firm may I did I'm just an Associates guy so anyway so with other things other regulations and again I think again partly. It may be a lot more easy than people really understand so other things that are problematic or challenges to take this type of organization. Move them into whether it's 100% ESOP or even talking about a partial ESOP are there are you seeing kind of that being pretty straightforward or is that there are other challenges we need to deal with. [26:58] I think that certainly the structure is probably the first thing you have to deal with I think once you get past the structure issue and as Heather suggested that's that's pretty common for any large group structure that's multi-state, so that's not you know Reinventing the wheel so to speak where I think that is probably been a bit of a concern. Especially as the. [27:25] Especially as the multiples are valuation multiples been so high especially in dentistry veterinarian. Physical Therapy autism centers all those multiples have been extremely high because the private Equity largely, and then and what it's I think a lot of people have viewed it as how am I going to be able to compete is an ESOP buyer. With that data given the fact that none of those entities none of those businesses are at least certainly most of them there's no. Guideline or Market comes to draw from because it's not really publicly traded companies in those spaces. More recently because there's been such a prominent private equity and strategic buyers there are law firms that specialize in these type of transactions. [28:25] And we think that we can secure Market data. That will allow us to be competitive I don't want to say that we would be a strategic buyer private Equity but it would allow that to be more indicative or what Market comps are. And when you're looking at a valuation. Annie Annie stop is a potential buyer for that matter any buyer you're really going to use a multitude of different valuation methodologies. One of which would be you know the historical performance another one would be the potential performance but also Market data is crucial and historically one of the bigger challenges that we had as part of Mortensen for the early years was there wasn't a lot of Market data to draw from so we were really valuing it based on our own performance not necessarily comparing it to other like businesses and I think we're starting to see some of that data trickle out which I think will help, an ESOP be potentially a competitive buyer and then you couple it with some of the advantages that he sobs had. I'm sure you've talked on some your other podcasts the tax free exchange for code section 10:42 which an ESOP can do that's worth you know maybe perhaps a turn or two of e bit odd that suddenly you're finding that an ESOP buyer, in a professional service organization Healthcare organization. [29:47] Might be in the range I wouldn't I don't ever suggest that they're going to be too. You know a PE in strategic buyer but you might be a lot closer than historically most people think you have them and I think that's been a common Miss I think that's been a bit of a an obstacle for a nice up to be a buyer of a position group of anything, that's a good point additional challenge that I think people really have to take into consideration, is the the organizations specifically government-regulated, entities that are reimburse errs so of their services so for instance if you're if you have any kind of contract with. Medicaid Medicare some of those kinds of things. [30:36] It's not it's not that you can't make it happen it's just I think those are things you have to be aware of going in that sometimes there's a requirement for their. North or contracted reimbursements, that might look a little bit different for for someone who's a non-professional owner and so I think you just have to take into consideration the potential. [30:58] You know we always call it re credentialing or or really the potential for a leg and in your Revenue stream while you're kind of working through that change of ownership so that's probably the only other thing that I can think of and you ask the question about what are some of the other potential, you know challenges obstacles necessarily but yeah maybe a little more challenging that's a great Point yeah because I you know I mean obviously the cash flows everything and if you. Don't have the Medicare reimbursement somehow it gets jeopardized with with The Change-Up, and then you could all totally ruin the whole thing right so so how do you get you just have to review the contracts and then how do you guys get through that issue just to make sure you're not jeopardizing that with a Management Service organization. [31:45] Really it's just diligence right I can't think of any time that we haven't been able to work past it it's really, probably more than anything paperwork's itís it's really truly the kind of proactive hey here's what our plan is here's what this is going to look like what's that going to require from your side of things. It's probably not a whole lot different than if you were transitioning ownership from one license professional to another it's just something that I think. Isn't always thought about ahead of time and so then you know when when it takes a little bit longer than probably most people anticipate and there's a potential. Strain on cash flow if that is a big source of Revenue you know always better to be a bit more prepared for that as opposed to kind of panicking and reacting after the fact so yeah I would agree with that Heather I think that's one of the things that. [32:41] It is just probably emphasizes the importance of if you're selling your business to get good representation whether it's a CPA and attorney, investment banker sell-side advisor of any sort. Is really just having them help you through the Journey of understanding how you go about selling and what the risks are and how you prevent those risk I think we haven't encountered a situation. [33:07] That you couldn't overcome as Heather suggested what those but I do think that with proper representation, hopefully they'll on. [33:18] They'll uncover those type of things before they become an issue but you don't want to do is to a change a control transaction where you violated your agreement I'm somehow you've stopped a revenue stream for a period of time they could be as you suggested Phil disruptive your cash flow. Fortunately have an encounter that just yet yeah but we've certainly encountered, at through due diligence situations like that where we've actually put a pause on a transaction to make sure that whomever that might be and that's not limited obviously too. Healthcare or Professional Services it could it could be you have a the first track to become a contract change of control issue yeah yeah exactly yeah I think I think those are good good for people to think about because it really should be probably identified early in the feasibility process you know review your contracts whether it's in health care or not review the contracts and see if there's any problems in your cash flow, that need to be identified if is there any issue with a partial DC part first first off do you see partially subsidized health care and are there any actual you see you see most often okay cause okay you too I think that will probably change. [34:34] But that Mortensen ESOP we did that started as a 40% esab it's actually probably hovering between 30 and 40% this day as I suggested the one we did in Ohio tire now which was the first 100% Dental Group ESOP I think the Professional Service Marketplace but especially medical is still kind of a bit of a cottage industry I think there's a there's a thought that the Physicians want to own, some level of the entity I would tell you with a lot of things going on certainly growing student debt that's not really as much of an option today is it was a decade ago, so you know employers Healthcare employees are having to adapt but we've racially we've rarely seen in the healthcare space control esops really okay is there is there a like a staged plan that they're coming into like a will do a truant here and, is it like a 10-year plan or is it just who want to do a partial take the benefit and then we want to keep that route that one part of the ownership. Private or just for direct ownership. [35:45] I think it's a couple things but Heather you probably could speak to this in a more important matter I think it's kind of the beginning of a succession plan for an individual most of the large Health groups that I know. Have a number of owners a number of providers. And so you're really trying to create a succession strategy for those individuals the ESOP you know can be a buyer of those folks so it is kind of beginning of an exit strategy you know because, there's a independent valuations conducted every year they have some level of knowledge or what that's going to look like, you know in our case of Mortenson even though we were minorities out the ESOP was the primary by or of all the retirees so we had we rolled up a lot of dental groups. Over about a 10-year period because they aspired to continue to work but they wanted to have the the. But confidence that when they were ready to retire they have a definitive exit strategy and in a fair price for their business and I think that's probably interesting enough. You know Healthcare businesses, that are the you know the most important asset is the provider of care hmm you know it's the license there and similar to. [37:05] You know the typical organization that's manufacturing and construction or whatever it is, you know it's the it's the leadership team that to me one of the things we look at valuations is we're always looking at succession planning looking at leadership development in terms of the continuity of value to protect the employee ownership, in the case of a Healthcare Company what you really want is to see that there is a continuity of providers and. Quite honestly you're always concerned about a concentration of a provider having too much of the Good Will and the patient relationship so it makes out I think an ESOP hopefully can. Create an environment where you can recruit those deals going on Health Care. Physicians that perhaps Can't Buy in and I think that's a real big challenge in the space mhm. [38:00] Whether it whether it's Dentistry or that narrating or psychiatric or whatever it is I think it's common that yeah for sure let's you layer on the opportunity for things like, synthetic Equity like Source programs and things like that ask you about that yeah yeah and you have a whole nother. [38:18] Really strategy for you know the crossover between performance and reward and retention. You know all of the challenges that any business spaces so yeah so you can really reward the ones that aren't buying it but become ESOP holders with. With an incentive plan like a stock appreciation rights programmer absolutely no yeah so I think those are again kind of comes back to normal Aesop's to you know and how you consider this business is just a normal business. So so kind of we're almost out of time I guess I would just say first off just as we think about what we just talked about I know we covered a lot of ground we don't always have a ton of time to get into all the nuances I mean we just kind of. [38:59] Pull this back today let's look at this a little bit would there be anything that you want to kind of add to what you said that for people that are thinking about their in a healthcare business that in terms of how they should go forward or thinking about this as a possibility. [39:15] Probably the only thing I would say and I don't think it's limited to to health care but you know I think that esops are really a very wonderful way to perpetuate culture and Legacy and I think specifically in healthcare. Because the business is a patient experience Legacy and culture really are. [39:37] Value driver and so an ESOP is a really fantastic way to be really true to be able to perpetuate that for generations to come, and I think it just varies really nicely with why people get into Health Care in the first place you know they're typically caregivers, they're really wanting to take care of people and so we've just found that. It's making good sense for a lot of people from an exit strategy standpoint so great I don't know what you would add great Point either you said. I couldn't have said it better I think that to me. It just resonates so loudly that you know Legacy is a common theme Legacy a culture like is he a value. Is a common thing of all ESOP companies that we work with certainly all the formations we see that every day. But Health Care is as Heather suggested it's a much more intimate relationship these are individuals that these providers are developing it and the dot desire to have Legacy of care, hmm his bow crucial and so I think that you know health care provider. [40:50] Probably more than most businesses that, that the the difficult to be able to walk away from the business even though it might be a better decision to sell to a strategic buyer financially / - yeah financially it might be a better decision but I think there is a fear. [41:08] That the care that these families that have been trusted. These Health Care Providers to serve their families and generations of families. Is so intimate that I think that I think an ESOP can, perpetuate that because you know the organization's the values structures probably potentially could continue more likely that structure it's good it's good point well again I mean we could talk probably for a long time about the topic we don't have that but I wanted to thank you guys for your experience I mean you know again to do the very first dental practice in the country as a nice topping is. Admirable and really very cool I mean to Pioneer something like that and to look at this topic to be honest with you I haven't really looked at it. As much because it's not it's not come across my table or my desk as much so I think it's really good for people, to be thinking about it and hopefully what we've done today is just give people a better idea about how this this could be another viable option for you you know to think about it so I really appreciate it and it is, scj fiduciary services so sorry I kind of messed that up at the beginning but guys are awesome so with that thank you so much for being here today, we'll look forward to our next podcast and the the new topics that we have coming in season 3 and just wish everybody a great day and thank you thank you for listening today.

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