The Smilist's Technology-Fueled DSO Scaling Strategy with Philip Toh

Alec Goldman:
Welcome to “How I Grew My Practice”, a podcast presented by NexHealth. I'm your host, Alec Goldman. In this episode, we have Philip Toh, Operating Partner at The Smilist, a DSO based in the Northeast region. He's here to talk about how his organization is using technology to scale and grow his employer brand and DSO. Phil, welcome to the show. It's so good to see you. How are you doing?
Philip Toh:
I'm doing well. Thank you, Alec, for having me on the show.
Alec Goldman:
Well, very fortunate from our perspective. Obviously, The Smilist has been an excellent customer for quite some time. Incredibly gracious for your business and learning so much from you along the way. So, for those who do not know Mr. Philip Toh, you can give a quick introduction to who you are and kind of how you came about being a part of the founding team, the partner of The Smilist.
Philip Toh:
I'm one of the co-founders of The Smilist and kind of fell into dentistry, I suppose, kind of after business school. So after business school, I went to work for a healthcare distributor called Henry Schein. And so that was kind of my exposure to dental. The joke was, I didn't have these career aspirations to be in dental middle management, but that's kind of how I started my career. Henry Schein and there, I really kind of got to see, this whole segment of DSOs grow, much earlier than, now I think it's kind of very common that people know about dental groups and how they've kind of in many ways replicated the medical side, right? But there for about 10 years, kind of got to see them grow all around the country as well as around the world. And so, after, I guess, towards the end of my career there, started chatting with an old business school classmate of mine, and we said, you know what?
I think there's an opportunity here in the New York metro area to start our own DSO. So it was kind of like this flip from being the seller on one side to being the customer on the other, and that was just super exciting. And I think that's something that even. You know, shine, encourage, and a lot of their employees were kind of how to be an entrepreneur. And so, you know, in 2014, took the leap, and, you know, and together we bought our first practice. And from the, you know, on Long Island, and then now we probably buy, you know, upwards of over 70 practices, and now we have 65 locations throughout kind of New York metro, you know, from Philadelphia to Connecticut, actually Delaware to Connecticut.
Alec Goldman:
So exciting. Can you dive a little bit more into the gap that you saw, and that you're thinking about, hey, what was the gap within patient care that you thought there was an opportunity to fix, improve, and ultimately scale?
Philip Toh:
One of our kind of thesis was really thinking about, kind of even take a step back and you said,  I'm a dentist, I graduated from dental school, and then all of a sudden, you know, I work for somebody, and then ultimately I buy practice and I, you know, run that practice. And we will say that person is a bit of a forced entrepreneur. Because when you go through dental school, hey, I didn't learn about marketing, I didn't learn about HR, I didn't learn about finance, but somehow you're kind of forced to do it. And this idea of, you know, there's an opportunity here to, you know, kind of run, you know, the business of dentistry better, because, you know, anytime you kind of focus and, hey, I'm gonna do this thing like really well.
And so that kind of came up with the idea of, how do you partner up with a dentist? let that dentist focus on the clinical side of doing their job, what they went to dental school for, where they spend the vast majority of their day, instead of being a part-time marketer after the day ends, after I saw my last patient. We have a team of people that focuses on marketing, on IT, on HR, on finance, that kind of do all of these things so that it's kind of the sum is greater than the whole. And so related to that is oftentimes, if you talk to a dentist, they talk about, that patient experience is just around like clinical care.
Hey, I provide really good care for so-and-so, my patients, as opposed to the overall patient experience. So that's where that gap is because now we have a team of people that think about like the rest of the experience, whether it could be things like online scheduling, or... kind of being able to make their payments or being able to communicate with us, that's not necessarily just a traditional I showed up at the practice. And so when we think about all of these things, then we're able to enhance that patient experience to, we're trying to modernize that experience because it's not like back in the day when somebody makes a restaurant reservation, they would call the restaurant. now it's like nobody wants to call the restaurant. You know, they're just booking it online.
And I think very similar as that kind of consumer kind of habits kind of are building and thus the expectations change. You know, we're applying that into dentistry and into healthcare and what, you know, patients expect from us. And that's part of that patient experience. I mean, even when you look at most of our reviews, it's not necessarily, hey, you know, I got the best crown ever, or I get the best, you know, whatever cavity filling ever, but it's about like, hey, I love, you know, the staff was friendly. I, you know, I could book my appointment online. Those things are part of that patient experience. And we're able to provide that experience because we're able to, you know, provide something consistently, as well as freeing up the staff's time. to not be on the phone with the insurance company while the patient is standing right there in front of you. So how do we take those things away so that the staff can focus on the patient that's in the office? And so all of those things you can do because you're through scale, we're big, so hey, we can do these things and take some of these functions out of the office so that people in the office can focus on the patients coming in.
Alec Goldman:
So the topic that we're going for is how to use technology to scale, growing obviously the business and really an employer brand, right? Like making staff really happy to work at an organization like The Smilist. Technology is such a vast word. If you can share it, and maybe it's obvious to yourself, but if you could share, what are the key technologies that we're talking about that are enabling The Smilist to scale?
Philip Toh:
Yeah, so building upon what I mentioned earlier is really, how do you make their job easier? So when we're talking about scaling, one of the things knock on wood that we're good at is when we affiliate with the practice, we're usually able to drive growth. And so a lot of times when, again, broadly speaking, that technology word is used, people think, oh, you know, this software or this kind of program is going to try and replace me or some portion of me, as opposed to no, that's not how we think about it. We think about it like how we get the team to focus more on how to deliver kind of more intimate and engaging care to the patients. And so we utilize technology to, I mentioned earlier, do an online kind of schedule. That can be done. So then that, you know, the phone doesn't ring as often. Well, if the phone's not ringing, then I can pay more attention to the patients that are right in front of me. And likewise, we have technology that will do, you know, all your benefits verification, insurance verification for the office so that they're not on the phone with, you know, the insurance company.
Those types of things are really enhancing the way patients kind of interact with us. We also have utilized technology that, we use chat bots that can interact with the patient and they can do things because of the connection we have with our practice management system. They can confirm appointments, they can check on appointments, and reschedule appointments using a chatbot. And again, that kind of takes away, that takes away perhaps a phone call or multiple phone calls that would otherwise come into the office. So we try and kind of pull these activities out of the office so that the people in the office can interact with patients, which going back to, how does that impact kind of our growth?
Well, kind of somebody that has these tools are just going to be, you know, I'll say kind of happier employees, right? So don't meet too many people that say, hey, I love to be on hold for 30 minutes, you know, on the phone with the insurance company, you know, at the office. And that's kind of like my day-to-day job. I believe many people in healthcare are in healthcare because they enjoy and love that, you know, the patient interactions if you're kind of in a non-clinical kind of role, and also the clinical interactions that you have with patients. They love taking care of patience.
And so to the extent that technology kind of allows that makes them be able to do that better, you know, I think that's what, you know, is the difference for us. So many times people think, oh, technology can kind of do this one particular task, but we think about it more broadly in terms of how do you enhance kind of employee satisfaction, kind of just allowing them to do their job better. So, you know, who doesn't want to do a good job? And that really kind of helps grow, you know, the organization as well as the culture, you know, within the company.
Alec Goldman:
So just to kind of spell out the very detailed process, you acquire a practice. That practice is likely using different technology than what The Smilist organization is on. You come in and say, hey, the tools and ways at which you've been operating, we're gonna be making some changes. We're going to be installing perhaps this EHR and perhaps this patient experience platform. That obviously for somebody who's been in a role for an extremely long period of time, can be scary. So can you talk about some of the challenges of just change management as it relates to technology?
Philip Toh:
Yeah, so absolutely. That's our business model, as I mentioned in the introduction, we've partnered up with probably upwards of almost 80 practices. And oftentimes, the technology that they're using, or perhaps the lack of technology they're using, is one of the big change management aspects. that we work on and really focus on. And so one thing that we've found successful, and I agree with you, it's completely scary and kind of intimidating for them, but we find it very much more effective when we're able to kind of bring in the staff like our integration team are kind of very experienced.
So it's not like, hey, we send in the IT team and the IT team is gonna switch you from this piece of software to the next. We have a combination as it relates to the technology and integration team as well as the IT team. The IT team can kind of manage a lot of technical aspects and really just make sure it works. But the secret sauce is really the integration team that has been there and done that. Hey, I've been in this role before. could be an assistant role, it could be a front desk role, it could be a hygienist role. I know kind of what you're going through. Some of them have gone through kind of integrations and conversions themselves. And kind of being able to make that kind of that connection, that deeper connection and not just saying, okay, this is better for you for X, Y, and Z reason, is like a huge kind of game changer. That's because it's not just how to use kind of a piece of software, but like why it's important and why, you know, this is better than the next thing and what it means kind of for them.
And being able to translate and be able to kind of articulate it in their own kind of words and vocabulary just makes like a world of difference. It's not like, hey, you know, we never wanna, you know when we step away. you know, after whatever the first week, it's like, you know what, you know, Phil, Phil doesn't understand my business. He doesn't understand dentistry. Doesn't understand how my practice works, you know, because technology is just one of the numerous things that we have to get right. And so we want, you know, where we walk away says, Hey, you know, we get it. Doesn't mean that, um, there aren't bumps along the way, but, um, but because we understand each other, uh, there's more, um, kind of leeway. for that when issues do arise, to say, OK, well, let's talk through it and how are we going to problem solve and figure this out. And so we don't take that hammer approach. We come in, say, OK, here are all the things you need, and take it, and that's it, and then we're gone. We're very collaborative in the way we introduce and implement technology.
Alec Goldman:
It's a really nice touch. How long does the integration team stay at each office? And what are some of their responsibilities? I'm sure certainly shadowing and helping train on existing technologies like NexHealth. But what else are they responsible for to ensure an easy migration from being an independent practice to being a part of this wireless brand?
Philip Toh:
Yeah, so oftentimes when we think about a conversion, there's a specific date in mind. But there's just as much work that takes place prior to it as well as the kind of after it. So this idea of how do we kind of minimize surprises? So whether it be converting practice management system or let's say kind of onboarding them to NexHealth. The great news is we have lots of other offices on it. And so there's a lot of internal experts. So we start kind of reviewing and showing them well before kind of that conversion date. Here's kind of all the tools. Here's how we use it. Here are all the different features. There's almost like an internal kind of testimonial of sorts. And so they're able to kind of see it ahead of time, depending on the size and the number of staff, it could be whatever, a week in, I mean, four weeks in advance, kind of leading up to it.
I'm much more involved in it, would be kind of the practice management kind of software, kind of training them, they'll kind of bring laptops. We have it run in the cloud so we can remote into other locations and then basically show them like, hey, Here are all the things that are different, but here are all the things that are the same. So this feeling like, oh, it's not completely changed over. And then afterward, our growth model is very predicated on us having geographical density. So we're not trying to be in 20 different states and we all have a handful in each state, whereas we have a lot in kind of very concentrated areas.
So we build this kind of network and community. And then when we're training, that integration team might be there for let's say the first week. So as you said, kind of shadow and kind of be able to answer any questions, kind of walk through all the different scenarios, but also having that community where it says, you know what, I need help. And I feel good that I have that relationship. Phil with Alex, so I'm just gonna call them up or slack them, you know, this kind of type of questions. And so because, you know, we set up our technology where people can remote in, you know, I could kind of jump in and kind of log into whatever your office and then be able to walk you through how to do something. And so a lot of it is just, I'll say, kind of mental knowing that, hey, I have a safety net.
So yes, all of this stuff is daunting and it's not, you know, it may or may not be easy, at least in their minds, but knowing that there's a safety net for them that, hey, you know, I'm not here by myself or, oh, on Friday, Phil leaves and, you know, then I'm by myself. Just having that like, look, you know, we're all a team, we're here to help each other. And that- you know, makes a world of difference because every whatever integration is going to be a little bit different. And so, you know, so it's important for us to be flexible in that, you know, not have this kind of rigid kind of playbook, because we've yet to find one that works 100% of the time.
Alec Goldman:
That makes sense. I guess you mentioned the community word, but each of these practices obviously is not located one next to the other. Yes, they're in the same region, but how are you building a community across practices, across the teams at each of those practices?
Philip Toh:
Yeah, so a variety of different ways. One, I'll say starting with virtually. I mentioned internally we use Slack. So we have a variety of different Slack channels, some that are office-specific, some are region-specific, and some are role-specific. So there's that interaction. And on Slack, it's more than just I'll say like business, there's lots of fun things kind of that goes on as well. So culture is one of the key pillars and I believe kind of our success. So that's one.
Two, there are a lot of regional events. And so we'll typically have regions for both, we'll have like a summer event as well as like a winter event that kind of bring people kind of together. at a social level, right? So it's not like, again, oh, I come for a business meeting type of thing. So for example, earlier this year, we had a doctor's summit where we brought everybody together in Times Square. And so that people are now kind of interacting, and then they know each other. They kind of have backgrounds on each other.
And then obviously, there's the business side of things as well, where regional managers will kind of You know bring the team together. It could be various kinds of regional training sessions. It could be trading even Let's say I'm a new employee that's starting and then they'll send me to location B to kind of train with that team Even though I'm going to permanently work at location A so then you know Then I kind of create that connectivity with somebody at a nearby location It's like oh, I know the team because my first like, you know two weeks I started somewhere else and I met that team and then I came back and then I work in this location. So you kind of do enough of that then there's kind of connectivity across the organization. So it's not one thing, it's lots of different things and I'm sure I'm missing some.
Alec Goldman:
I'm sure, but certainly, it's a huge focus for The Smilist. And I'm sure it's why the retention of your staff across the locations is just so great. Obviously, The Smilist, the business model to what you said is that dentists focus on clinical care and are going to get lots of support before, during, and after each patient appointment. It means that the technology that your organization is using specifically before, also during, but end. really after is so important. Can you talk a little bit about what is the criteria that you have in your head when selecting a vendor for something that is just so fundamentally important to your bottom line?
Philip Toh:
Yeah, so it's crazy to say this, but it has to work. I can't tell you how many things that you look at and then it's like, it doesn't work. And whatever, I'll caveat that by saying it has to work for us because we have our set of processes and our kind of culture. And so when we look at technology, it has to make sense. And where, again, going back to it, it really is helping. We've tried software where it kind of sounds good. And again, for a variety of reasons, it just doesn't work. And it just makes things more kind of complicated. We've talked a lot about change management already. But one aspect of that is workflow. it's okay, you know, I'm used to doing things in kind of these 10 steps.
And then now there's some, you know, small to large kind of change that I need for it. And so whenever we're evaluating technology, we keep that in mind a lot, you know, so it's not just, hey, what are all the, you know, the features that the software can provide, as opposed to not only can I, you know, provide that, but how does that fit into how we, how we work? and how much of a lift is to shift that change, clinical or kind of otherwise. And oftentimes when we find that that's the case, because inevitably the features, we're only looking at technology that can really kind of benefit the team and kind of make them be able to do their job more efficiently. It's not so much, hey, can it, does it do what it promises to do? I assume that it can, once it passes the does it work kind of criteria. But after that, it's really how it fits into the organization. And does that company have the resources to help make that happen?
Because at the end of the day, it's kind of like, we know our team and our processes really well. And then the company knows their product really well. So. We need to have the appropriate level of resources to connect and say, okay, you know, these are the things that we can do, you know, well, kind of together and we need kind of your help. And so, we find, you know, whenever we're talking to companies, like what kind of support do they have? And, you know, training, because ultimately, once you get it integrated, we're very confident that it will help the organization.
Alec Goldman:
So I had to bring up the history here, but you are a long-time believer in NexHealth and Alamin.
Philip Toh:
Yes.
Alec Goldman:
And NexHealth, I'm confident knowing Al and the team and our product and engineering folks, this will always work, but you are using a fraction of what it is today and really believe in the business early on. So I wanted to get your perspective of like, what was it early on that you saw in Next Health? to have joined and committed your organization to our platform and ultimately have seen it through to what it is today.
Philip Toh:
Yeah, yeah. It's, I think it was something you said earlier, it's a people business. And so, you know, when I got a chance to meet Al Amin, it was just, hey, you know, we connected and kind of really like the vision that, you know, he had painted. And, you know, the thing with visions is, you know, you're not there yet. But I really like the direction in which kind of next And even today, it's a very customer-oriented organization that will say, it's OK to tell me bad news. It's OK to tell me, hey, these are the things that you're not happy about because they'll evolve it.
And so our prior vendor that we dealt with, the product is very stagnant, there was nobody to talk to, and you just didn't get this feeling like, okay, I'm gonna be here a year from now, and it will still be the same thing. Whereas with Al, kind of chatting with him, he was always kind of soliciting, oh, what do you think about this? What do you think we should build next? And didn't always listen to what I had to say, but there was that curiosity and kind of taking that kind of customer feedback to continue to evolve the product and the company.
And so for us, like I was saying, like if we stayed with our other company, it would have been the same a year later. But with NexHealth, it was like, it was different from day one to day 365, it was different. And then the next kind of year was different. And that kind of continued evolution, just as we like to grow and do things differently. Like earlier I described our integration process. it did not work like that. You know, at the beginning, we had a lot of bumps and we took a lot of feedback. So philosophically, I felt like we were very kind like-minded organizations, and I thought that we could create a lot together as a result.
Alec Goldman:
Again, I can thank you 10 times over, but the business I know is extremely thankful for your trust early on, because jumping into a platform that is early days relative to competition that's out there has way more features. But again, if the curiosity, if the vision, if the alignment,
Philip Toh:
Yeah
Alec Goldman:
then, you know, it's hard to make that decision. So, you know, at least from our perspective, certainly extremely excited about the partnership. What are additional technology changes that you're thinking about implementing for The Smilist over the next year?
Philip Toh:
So one thing that we've been thinking a lot about is just data. And I'm not sure if maybe this is specific to us. I don't think so. However, our ability to continue to leverage technology and all that it has to offer is heavily dependent on the information that we have. The good news is we have a lot of information about our patients. you know, all the times that they've come in, different types of procedures, kind of, you know, employers, insurance, all of this. I think that we have really kind of scratched the surface on utilizing that data to provide a very kind of customized, you know, patient experience. And that could be in terms of, you know, patient education, it could be just of overall interactions that don't feel like, oh, I'm getting a templated email that's kind of wishing me happy birthday on my birthday, you know? And I think there's just a lot that can be done around that.
And I think there's a lot of flowing effects and not just in terms of like the actual just like patient communication. I know one of the things I was talking to Al about is like, dental, you know, visit experience where, okay, you know, you're going to book your appointment online. You're going to know how much you know the visit it's going to cost, you're going to have all your payment details, you're going to come in, you're going to go, you know, get your treatment, and then you're just going to walk out, just like you walk out of the car. There's not like, oh, let's this kind of checkout process and let me kind of, you know, book the next appointment, this and that. All of that can be done dynamically and through all the information. And so again, hey, I noticed you really like to come in on Tuesdays at 4 p.m.
And that's the time that will be offered to you. Again, we have all that information, but right now we don't quite utilize it or don't utilize it in a very systematic way. And so even from revenue cycle. management, you know, how do we take all the data that we have on insurances, insurance claim payments, denials, things like that, and then create, you know, what I call like a self-healing kind of database because we're constantly getting information. So how do we continue to fix that? That says, you know what? I have entered incorrectly that this thing should be paid at a hundred dollars. Insurance keeps paying me could be 101 or $99. but oftentimes organizations aren't fixing that or they're fixing it in a very manual way. And so how do you kind of create the systems that will allow it to kind of make these corrections with a certain set of rules so that the business runs more and more smoothly? So I think that's, I'm looking forward to that part.
Alec Goldman:
Yeah, I mean, it sounds like everything really just in service of trying to make for a much more seamless patient experience and thinking about just every single day, what's that 1% thing that we could be doing better to
Philip Toh:
Yes.
Alec Goldman:
almost catch up dental to a lot of industries that I think have done a great job of really thinking about the customer experience.
Philip Toh:
And that's where we look for a lot of examples that aren't necessarily, hey, let's look for whatever, a healthcare example. I think we look broadly in terms of like, hey, what do people like? And it's not necessarily enhancing, kind of continuing on that Uber example, right? The Uber example is I know what's going to cost and then I just step out of the car. But if I were the taxi cab company, I'd say, okay, well. you know, instead of paying cash, I'm gonna have a credit card terminal and then, you know, make it easier for you because you can pay with a credit card terminal in the cab. But that's not necessarily like, you know, they're kind of stuck in their kind of, you know, mindset, right? Like their frame or the map of the world, as opposed to no, you know, what? I would love a world where, hey, everybody just walks out of the practice, there is no checkout process needed. You know what's gonna cost, you come in for it. and you walk out and
Alec Goldman:
Yeah.
Philip Toh:
everything kind of gets auto-billed. I don't have to take out my card. I don't need to do Apple Pay. Like all of these things are great, but it would be even greater if, you know, I'm valuing the patient's time and kind of providing that experience where, you know, that they're becoming more and more accustomed to.
Alec Goldman:
Yeah, there's a, I think Brian Chesky had a, I don't know if it was a podcast or a talk, but kind of went through the exercise of saying, what's a five-star experience?
Philip Toh:
Yeah, the 11-star.
Alec Goldman:
A lot. And it's just like, what's a 13-star experience, right? But
Philip Toh:
Yeah.
Alec Goldman:
it really forces you to get out of your, out of your world and think about stuff much more outside of the day-to-day and think we had to draw this from scratch and you end up thinking about such more innovative ideas.
Philip Toh:
Yeah, absolutely.
Alec Goldman:
Phil, we are, I mean, I'm taking a lot of time here. I know we're at the 30-minute mark, but what is the final parting word here on, technology, the challenge of implementing technology to scale and grow, both in the employer brand, but also your organization?
Philip Toh:
So I would say my final thought is really, I always say, look, I'm not smart enough to figure out what's the technology that's gonna win out and be dominant, but what I want the organization is for us to be open-minded and flexible. And so our skill is not necessarily how to use a particular kind of software really well as opposed to, hey, we're going to kind of be open to adopting new technologies all the time. whatever kind of always looking over the horizon and being kind of curious, intellectually curious on how things can kind of help us continue to advance the patient experience. And so, yeah, so it's just not stuck with, hey, this is, you know, I implemented this and this will how it will always kind of be forever and ever.
And I feel like that's a common mentality within dental. And I think, look, we're fortunate to be in a time where I feel like there's this kind of dental technology renaissance, where there are so many kinds of smart and ambitious people thinking through kind of problems and how to apply technology to solve those problems. Some will be successful. Some won't. And I think from our perspective, it's like, OK, you know. company A is fantastic today, but didn't kind of keep up with the times, and now company B is better. I want us to be good at, okay, we'll just switch to company B. Maybe there, again, like the integrations, there is the change management that we have to manage for. But if company B is actually doing it better, then we should focus on leveraging the best tools that are available. to us in the marketplace for us to deliver a better patient experience.
Alec Goldman:
I'm certain that you've built an organization of adaptation
Philip Toh:
Hahaha.
Alec Goldman:
And dealing with those changes and having lots of people who are ready to make changes and build something not just great at the organizational level but at the practice level for each patient. Phil, thank you so much for the time today.
Philip Toh:
Thank you for having me.