Navigating Practice Transitions
How Physical Therapy Central successfully partnered with Confluent Health.
By Bridgit Finley, PT, DPT, FAAOMPT
“Start with the end in mind.”
These words, by Steven Covey,1 helped me successfully navigate the partnering of Physical Therapy Central with Confluent Health this past January. Confluent Health is a newly formed private-equity firm resulting from the roll up of several successful entities under the direction of Larry Benz. PT Development, Texas Physical Therapy Specialists (TexPTS), Fit for Work, Evidence In Motion, BreakThrough Physical Therapy, and now Physical Therapy Central all came together under one common holding company, Confluent Health. Now months later, I still view this as a success. But not all such mergers are successful. Why this one?
In just 10 years, Physical Therapy Central (PTC) expanded from one location to seventeen—from a small business to a significant enterprise. In 2014, I transitioned from treating patients to full-time Chief Executive Officer (CEO) in order to devote my full attention to this thriving business. We also began to centralize systems—payroll, accounting, and human resources—to enhance our ability to effectively manage the increasing size of the company. Unknowingly and unintentionally, we were positioning ourselves to be an attractive acquisition. While PTC was successful on its own, partnering with Confluent Health provided the opportunity to achieve two goals: (1) to enable us to have an impact on health care delivery as a nationally recognized player, and (2) to solve my need for a succession plan and an exit strategy—all without sacrificing our culture. Successful partnering does not happen by chance. You must start with your goals—the end—for merging and test each step against those goals.
Hit by the Bus
Like most small businesses, PTC would be vulnerable if something happened to the founder/CEO of the company. We wanted to make sure that if I was “hit by a bus,” that the company would continue as one and not splinter into 17 different clinics. At the time none of our partners wanted my job as CEO, nor did they have the means to buy me out. Even if I survived the “bus,” I wanted an exit strategy. I have witnessed too many practice owners build their practice up, only to begin to think of an exit strategy when they are ready to retire. Without a plan, many practices simply fold. I wanted a plan that provided an exit strategy 10 to 15 years in the future and allowed me and my partners the opportunity to realize the value of the practice.
Keeping the “end in mind,” we structured the merger in a way to address both contingencies. Confluent Health acquired a majority of shares in the PTC management company and has the ability to buy the rest on my timely or untimely demise. Confluent Health, through its many constituent companies, also has a number of executives capable of stepping in to take the reins at any time if necessary. I love being the CEO and running the company, but I sleep much better at night knowing that I have partners in the management company to ensure that PTC will live on beyond me.
Create a win–win
Successful businesses are built on concepts of partnership and win-win solutions. Each PTC location has a local partner. An advisory board composed of the nine original partners assists in guiding the company. The concept of partnering is part of our DNA as well as it is at the core of our culture and is nonnegotiable. The success of the merger depended on continuing the culture of partnering and finding a win-win; incorporating terms good for us as well as for our partners. For us, this was achieved by allowing the advisory partners to buy in to the new management company—to become part of the whole, not simply of their clinic. However, as we approached closing, I became nervous. I needed more than just legal documents to give me the assurance that our culture would continue. I called Larry Benz (CEO of Confluent Health) to assure that we will always work to find a win-win solution. We had a long talk and he assured me that we would. I believe that all business deals should have both handshakes and legal documents.
Structuring the deal is really the easy part. A successful partnership postclosing takes work and similar core values. As we traverse the minefield of combining our two companies, we are aided by the fact that the core values of Confluent Health and PTC are very similar and the culture is one of family. We both agree that nothing is more important than our people. As a result, the many changes emanating from this merger have been easily accepted by both leadership and all of our team members.
Be Proactive and Sharpen the Saw
The success of this transition actually began many years ago. One of the best things that I did early in my career was enroll in the Evidence In Motion (EIM) Executive Program in Private Practice Management. The foundation acquired through the program was essential to our company’s success. EIM’s Program allowed me to meet Larry Benz as well as many of the partners in Texas Physical Therapy Specialists (TexPTS). I met more of my future partners while completing an EIM fellowship. So when Confluent Health called, I was ready. I had the knowledge to evaluate the proposal. More importantly, I knew, liked, and respected the people involved. It all came down to trust. I put my ego aside and realized that Larry had better skills in a complex business and health care world to lead us going forward. As CEO, I would continue to lead my team and grow our clinics with my local partners.
Combine the strengths of people through positive teamwork, so as to achieve goals that no one could have done alone. I feel like I have the best of both worlds. We are now a large business, but we think and act local. With Confluent Health, we have found a partner that shares our belief that we can do something special in the health care arena. As a member of the Confluent Health family, we are able to draw on the resources of the diverse companies. We can provide a model of care where physical therapists are the Best First Choice for musculoskeletal dysfunction and movement impairments. I want to help transition physical therapy to an evidence-based practice coupled with clinical excellence and change the way that physical therapy is accessed by the general public. We are now part of the largest, privately owned physical therapy group in the country led by well-respected, education-focused leaders in our field. Change is possible.
The merger was a turning point for our company. I think the biggest win for us is the partnership, the shared knowledge, and the ability to lean on my new partners. It took quite a bit of grit, as Larry would say, to get to the finish line. But like most things in life, nothing worth doing is achieved without effort.
1. Covey, R. Stephen,The 7 Habits of Highly Effective People,Free Press. 1989.
Bridgit Finley, PT, DPT, FAAOMPT, is a PPS member and chief executive offier of PT Central in Norman, Oklahoma. She can be reached at firstname.lastname@example.org.