How to Transition Your Dental Practice During COVID-19

A. Lee Maddox, DDS, Esq. Maddox Healthcare Law www.maddoxhealthcarelaw.com lee@maddoxhealthcarelaw.com (949) 675-1515

 

The Transcript

Art Wiederman, CPA: Hello everyone and welcome to another episode of The Art of Dental Finance and Management with Art Wiederman, CPA. I am Art Wiederman. Welcome to the podcast. I'm a dental specific CPA. My practice for 36 years has been located in Southern California in the city of Tustin. I am now a proud member of Eide Bailly, which is a fantastic CPA firm with offices all over the western United States - we're their Southern California office.

I am a director in their dental division, that is the title I have been given and that's just fine with me. And today I have a real treat for you guys. I believe we're episode number 85 today. As you know, one of the great things about working in this profession is you make friends and there are and you get to the points like you have a you have a specialist if you're a general dentist that you just like you just say, this is my go-to person, this is my go-to endodontist. This is my go-to periodontist. This is my go-to orthodontist. Well, you know, we work with dentists, with attorneys and we work with other professionals. And my guest today, who is my dear friend, Dr. Lee Maddox, is just somebody that if I've got a problem and I call him, he's got the answer and he knows what to do. And those are the types of people you want to be working with. And Lee is... You'll hear a little bit about his background, but we're going to talk about the atmosphere right now for transitioning of practices in the middle of a COVID-19 pandemic. We're recording this podcast in late July of 2020. So there's a lot of things that have changed. So we're going to get to Lee in a moment.

I want to give you some information first. If you want to get a hold of me in my office in Tustin, you can call me directly at 657.279.3243. You can email me at ArtWiederman@gmail.com. If you want to see copies of our old podcasts, you can go on to our website, which is https://www.eidebailly.com/dental-cpa-podcast and all of our podcasts are there. You can also go on to our great partner Decisions in Dentistry's website. The some of the best clinical content you're ever going to see in dentistry and a who's who on their advisory board. Great continuing education products that you can take advantage of during this very challenging time. Go to www.decisionsindentistry.com.

And if you want a 30-minute consultation, complimentary consultation with a member of the Academy of Dental CPAs just mark the box on the website and we'll get you to the member. And if you're looking for a dental specific CPA anywhere in the United States, if we're looking in Southern California, that would be me and my team. But anywhere else in the United States is the Academy of Dental CPAs, which is 24 CPA firms across the United States. And we're approaching working with close to ten thousand dentists. So we're very closely connected with the A.D.A and we do a lot of things with them. And in my opinion, we're the premier dental CPA organization in the country.

So I do want to give you one update today before I get to Dr. Maddox and we start talking about transitions. There's been a lot of controversy and talk about the HHS provider program. The provider fund was one hundred and seventy five billion dollars created by the CARES Act, and it basically represents two percent of your gross revenues. And I talked about this on the podcast, I think, last week. So one of the issues that has come up with this is something called balanced billing. And what happened with the balanced billing is that if you look at the terms and conditions, if you take this money. And again, if you have a million dollar practice, it's twenty thousand dollars and probably fourteen thousand after taxes. So it's not life changing money, but it would be nice to have; it is taxable.

But this balance billing issue basically said that if I have a fee for service practice and I see either a presumptively infected COVID-19 patient or someone who's actually got COVID-19 then. Basically, if I'm a fee for service practice, but they have insurance with an insurance company, I have to accept, you know, basically in network rates, which was absolutely, you know, blowing this whole thing up, people not taking it, people saying it's not fair. People saying we don't understand it. I did want to let you know that today when we recording, which is the 23rd of July, HHS came out with a frequently asked question to this and basically said that you are considered to be seeing someone presumptively if the COVID-19 diagnosis is in your medical chart. The fact of the matter is, is that dentists who presumptively know that a patient has or could have COVID-19 is probably not coming into their dental office. So you want to go on to www.HHS.org and look under the frequently asked questions, read the terms and conditions you have until August 3rd in order to take this aid, which again is not life changing money, but it is nice. But do read the terms and conditions.

All right. So let's get to my my dear friend, Dr. Lee Maddox. I've met Lee, oh, my gosh 30 years ago, probably, when he and I had dark hair and Lee was an endodontist. And my big joke with Lee is that he couldn't figure out what he wanted to be when he grew up. Lee was a one of the premiere endodontists in Orange County here in Southern California. Lee went to, you know, then decided to go and become a well, then Lee well, I'll let him tell you a story. There was a disability involved and he's been a lawyer and a broker, and he is one of the absolute smartest people I know. And don't let this get to your head Dr. Maddox, but welcome to the Art of Dental Finance and Management.

Dr. Lee Maddox: Thank you. Hello, everyone.

So I'm going to just give you a little bit background on who I am and what I've done over the years. And then Art threw me a few questions last night. So we're just going to talk impromptu about what I see on a daily basis in my in my law practice. And I'd have probably around 5000 law clients. I manage somewhere between 60 and 80 transactions a month of all spectrum between partnership formation, corporation formation, office lease negotiations, asset purchase agreements, associate contracts.

As I asked my assistant yesterday, how many active transactions I'm working on at this moment, and she said I had 78 active transactions, eight of which had gone dark temporarily. So I'm working on 70 transactions right now, which gives me a little bit of input, a little bit of exposure to what's going on.

It's not all telling, but it's a little snapshot about what's going on in the Southern California, Northern California area. So a little background on me.

I went to USC undergrad 1983. I graduated. I was a biology major. I went to USC Dental School in 1987. I went right out of school to go to the Endo program at USC in 1989. While I was in the program, I worked as an associate. So I know what it's like to be an associate. I purchased a practice right out of school in 1989 so I understand practice ownership. I started becoming disabled in 1992 and at that point I hired an associate so I flipped from being an associate to hiring an associate and then I ended up selling half of my practice. We formed a relationship and you can form a partnership or a corporation. We did something called a group solo which was a space shared relationship. We ended up building out a new office in 1993 and novos. We did a brand out build out.

And then I opened the second office I got that in 1993.

So then I started this disability. I fought it pretty hard, but ended up having hand surgery in 1994, the original diagnosis, which I had carpal tunnel syndrome. So I had hand surgery and then in 1995, I got my board certification. And then I had a shoulder surgery in 1995. I built another office out in 1996. And then I had a second shoulder surgery in 1996. And at the ripe old age of 35 in 1996, I was 100% disabled. And I took my practice that I bought from $270,000 a year in revenue to about $2.3 Million a year in revenue. So we were successful in the marketplace. We just didn't have the physical physicality to stay into the job. So it ended up being a genetic issue. I should say a hereditary issue. Every member of my family just about has some kind of a disconnect between the brain and the hand where we get limited strength and altered feelings in our hands, so my hand feels like it's asleep 90 percent of the time. So the take-home message here, if you have disability insurance, keep it. If you don't have disability insurance, get disability insurance. If you're having an issue with disability insurance, I think Art did a presentation with a Randy Curry, who is a good disability attorney that can help you review your policies. But the critical thing is we insure everybody in our lives. So we want to make sure we insure ourselves. We spent a lot of money on our education. We spent a lot of time to get where we're at. We need to protect ourselves. So at the ripe old age of 35, I stopped working in the dental profession in the clinical aspect of the industry. And I got involved with a dental manufacturer called Tikhon Dental. And I took an ownership interest in that. And I worked with him from 1996 to 1997, electric for them nationally and internationally. We made nickel, titanium, rotary instruments, did a lot of great things there. Curb with nickel, titanium that are currently being used in the marketplace. The company was fairly dynamic. Unfortunately, we had some issues with some patent problems and we ended up getting bought out by another large company and I discontinued working for them in 1997, went back to law school and law school was the most fun I ever had.

I really enjoyed hanging around. I was 37 years old when I went back. I got to hang around with 23 and 24 year old’s. It was super fun and it was fun to go to school and not worry about being in the top of the class. It was fun to hang out with young kids. I did about 25 1040 tax returns where they called tax 1040 EZ. What do they call those?

Art Wiederman, CPA: I didn't know that. I would've hired you to help me do tax returns dude. 

Dr. Lee Maddox: I gave dating advice. I coached baseball team with the students. We had students over weekly for dinner.

Art Wiederman, CPA: Hey this is a full-service podcast. We talk about everything. So any dating advice on here?

Dr. Lee Maddox: And it was it was incredible. I recommend if anybody is thinking about going back to school later in life to do it. It's super fun. I came out of school and I did a little criminal defense work. I realized that some people should go to jail. In contrast to what's going on in society today. So I needed to be on the plaintiff's side. And then I switched over to patent work and work for a large company called Knobbe, Martens, Olson and Bear. And they primarily worked on a noble form of dental implant, dental implant stuff. So I did that for a while. I hated it. I went to work with a suit and tie, got there at 6:00, left at 11:00 at night with a suit and tie. And I was the dumbest guy in the building. Everybody had triple PHDs. So it was an interesting place to work, but not for me. So I jumped out of that and went into the transactional dental attorney business in 2001 and I got into this healthcare space. So it made sense for me as a dentist to work primarily with dentists. But I also work with optometrists, veterinarians, medical doctors. So it pretty much covered the whole space. I don't do a lot of chiropractic work. I did that until about 2010 and in 2010 I decided I wanted to see what the other side of the fence looked like. So I started a brokerage business called Maddox practice group, and we did very well. We were primarily in Southern California and then we also operated out of Northern California. And in 2013, this small company called Henry Schein bought us out.

Art Wiederman, CPA: I've heard of them.

Dr. Lee Maddox: Yeah, big company.

And so I ended up managing that practice transition business for them in 17 states, had a whole bunch of agents working for me. And basically in that role, you know, everything from the nondisclosures to the purchase and sale agreement, preparation to office lease negotiations, just to managing the team. That was a full-time job with a lot of travel. So after five years, I said thank you and I retire from the brokerage business in 2018. I went back to the full-time practice of law and I've been doing that ever since.

Art Wiederman, CPA: And as I've told everybody, you know, you have you go to people. I have my go to people. And Dr. Maddox, I was sad when he left being a lawyer because there went one of my lawyers. There are other wonderful lawyers who I've had on this podcast. But now he's back, which is nice, and he's got all this experience. And being that you didn't have a whole lot going on, you also just became a grandpa.

Dr. Lee Maddox: Yeah. So.

Art Wiederman, CPA: So how's that working out for you?

Dr. Lee Maddox: It's great. I've been I've been married 33 years. I got four children, thirty-one to twenty six. And the two girls, two boys. And we just had our first grandchild, Eleanor Marie Rhinehart. So she's three weeks old, going to be four weeks on Sunday. And it's what they it's true what they say it's great to be. It's the reward for having children. So we're pretty excited about that.

Art Wiederman, CPA: No, no, it's my revenge. It's going to be like that because when they have children. Oh, I am going to. So get even with these people. I swear to God, Nathan and Forrest, you better be worried. No, I'm just kidding.

Dr. Lee Maddox: Before we go on, I go over my resume, to really just let you know that I have vast experience in what we're talking about today. And at the same time, I like to caution you that even though I do this every day and I have all this experience, I don't know all the answers. And I think that's a critical thing for everybody listening is that if you're going to go through a practice transition of any sort, you need to get people involved with you that understand the transaction from dental CPA, a dental consult and a dental attorney, a dental lender, and get advice from some qualified people. I think it's silly to take advice from somebody who sold one practice or bought one practice. They have some knowledge. It's a limited knowledge. But it's really important to understand that when Art said in the beginning, as he calls me all the time, I call him all the time, because people were raising issues that they're difficult issues and you don't you can't have all the answers. And so you have to have a peer support group that you can communicate with to get these questions answered. So if you're going through any kind of transition. Yeah. It's great to listen to these podcasts, get a good team around you that knows, you know, something about the industry and make sure you take the limited advice from those that have limited information. Selling one practice, owning two practices, they know something they're good to listen to, but they shouldn't be the driving mentor in the relationship, you know, of your of your transaction.

Art Wiederman, CPA: And you're absolutely right, Lee. And so I want to start the discussion about, you know, we're four months into the COVID-19 pandemic. I'm a dental practice broker. You and I have had lengthy, lengthy conversations because I called Lee up and I said, you know, Lee, what is this going to look like? So let's say I get a salary. He's got a million dollar practice netting thirty five percent, you know, in Southern California, valuations or, I don't know, 80 to 90 percent depending on the practice. If it's a good practice, it could be lower. Like anything else. We're not going to get into a lot about valuation, but. So if someone comes to you says, I'm thinking about selling Dr. Maddox, what should I be thinking about what's going on right now? What are we seeing in the marketplace? And then I can comment on it, too.

Dr. Lee Maddox: Okay. Not to be too much of an attorney. Let me just give you a little disclaimer. Oh, everything we're going to talk about today is my opinion. And it's just my opinion. It's what I see on a daily basis. So you're going to get a little bit of it. It's all about perspective. You do most the people on the phone or doing dentistry on a daily basis. Or maybe they're a consultant. I'm a lawyer. As a lawyer, I see the good and the bad and so I'm going to give you my opinion. Whether that fits your narrative or not is, you know, that's not something I can control. If I say something that's offensive, I apologize in advance if I say something that you don't like. OK, I'm sorry about that. I I've done a few of these Zoom lectures and every once in a while I'll get a comment back and somebody will be highly offended that they just didn't believe what I had to say. And that's really OK. This is information. Take it as you like, use it as you like and understand that, you know, you're in the process of gathering information, gather as much information as you can and make a cogent decision and hopefully you'll find this helpful. So, OK, so getting back to what Art asked me, what's going on in the marketplace and I think everybody has equally participated in this. We had this shutdown. And here's probably the most potentially offensive thing I'm going to say today. I am disappointed in the way that organized industry approached the handling of the shutdown. I think that the A.D.A and all of the individual state organizations and the local organizations should have fought for dentistry. I'm disappointed that they didn't come out and say that oral health is important to biologic health. I'm disappointed that they didn't say that universal precautions have properly protected the patients and that we're doing a better job protecting the patients than anywhere in the patients are safer in the dental office than they are out on the street and they're actually safer in the dental office than they are in a hospital because we don't get nosocomial infections in the dental practice. So so I tend to be an optimist. But on that particular issue, I just have to say it's unfortunate that we didn't get the support from our organized dentistry. I hope that they will support us going forward if there's a potential shutdown.

We know we're all looking at what's going on in the world of the pending second wave and the impact of the second wave. And they just have to realize that that, you know, I think we're in a political year.

You know, we have one hundred forty four thousand deaths in the US after testing. Forty eight million people are our death rate. Somewhere between two and four percent, depending on which state you looked at, compared to most of the countries around the world. They're running seven to 10 and 12 percent, depending on where the morbidity rate, depending on where you look and you can look up your own articles on it. But the U.S. is doing really pretty well. The morbidity rate, we do seem to have a higher number of cases, predominantly between the ages of 18 and 48. So the ages of 14 and 48 are getting these COVID-19. Many of those patients are asymptomatic. It's also interesting and a political issue, too, here that, you know, they're making all this noise about hospital beds being filled. If you look it up in the flu season, the worst flu season we had a couple of years ago, one hundred thirty seven thousand hospital beds are occupied for flu seasons. At the height of this COVID-19, we didn't have more than thirty seven thousand beds occupied in the U.S. with COVID-19 patients. So it's a big number, but it's not a huge number compared to the flu as far as bed, hospital bed use. But the reason I raised that issue is this is causing stress in the marketplace and everybody is concerned that there's going to be the second wave. And the second wave there's going to be a practice to shut down.

And so what we're finding is doctors selling, doctors are panicking. So we're getting a lot of practices going on the market for sale. And some of the doctors or have just I think, Art, you remember back in the 2010, 2008, when we had the market crash, there were a lot of doctors that said, oh, I was going to retire and they were going to retire, and then they postponed retirement three, four or five years because, you know, their 401ks were wiped out.

Art Wiederman, CPA: They became 201ks.

Dr. Lee Maddox: So this is a little bit different. This was this was more catastrophic because we had lots of different issues going on. We had practices being closed with people losing their jobs. We have dental lenders not lending. So, you know, if this was this was a total this is completely different than what we've had in 2008.

So what we have now is we have a lot of sellers on the marketplace that are saying, should I sell my practices now? So I've always said if you're you two things, you should decide. If you're mentally ready, you're financially ready and Art's the best person in the world to tell you if you're financially ready. Financially ready means if you take all your if you sell your practice and you get no revenue from the practice and you take all that money and you put it in a bank account, you lock it up and you don't use it. Do you have enough money to pay your bills? And if you have enough money to pay your bills, how much money is left over after you pay all your expenses and then you can basically decide if you can retire or not. And the money you take out your pension Art what do you say it's where you get it, you can only take four percent a year out without eating youir principle?

Art Wiederman, CPA: Yeah, that's the rule of thumb for, you know, four to five percent for four and a half percent. It really depends on how you live and all this stuff. But yeah, you do have to look at, you know, if you get tired, I mean, you don't want to do this anymore. And then you come back and you say, this is not what I signed up for. I'm going to retire. I can do this. And if you can. That's great. Which is a great reason to save money. But. But, yeah. So. So the sellers out there, you've got more sellers. It's been a seller's market in many areas of the country because we do this nationwide. But it's been a seller's market for a while, hasn't it?

Dr. Lee Maddox: Oh, yeah. I mean, it's definitely been a seller's market. We graduate about 5800 students a year and we do about 13 to 14 hundred transactions a year. So it's always been a seller's market in the right area. The rural areas have been a little bit always been a little bit different, but it's been a seller's market. So I was saying earlier, I used to ask him, are you financially ready and mentally ready? The big component with mentally ready now. We have doctors that are mentally wanting to practice dentistry still, but they're scared. So one of the things that we continuously hear is that if you're over 70 and you're a white male and you have comorbidity, then you have a higher risk of getting a pretty serious case of COVID-19.

And so we're I think Art and you're seeing is that the doctors are coming to us and and they're they've either opened or they're most of it. Most everybody's open now.

Art Wiederman, CPA A few haven't. Ninety-seven. Ninety seven percent, according to the FDA, are now open.

Dr. Lee Maddox So 97 percent are open, but they're scared. And so we're seeing people that have real fear that that, you know, that that they're going to get sick from practicing dentistry, even though they're putting HIPA filters in and they're wearing all kinds of different devices to try to protect themselves.

And so they're putting their practices on the market. And there are some predatory buyers out there and some predatory advisers out there that are saying, hey, why don't you this make a really low offer on this practice and see if you can steal it. And the basis for this and an Art and I are not having a long conversation about practice valuation. But the basis for their position is, is nobody knows how to value practices today. And maybe Art does. But, you know, people are selling their practice at pre COVID-19 numbers and so you're looking at tax returns from 17, 18 and 19. And Art said there's a range of what people are typically looking at, whether it's sold on or whether it's sold on a percentage of sellers discretionary earnings or whether it's sold on a percentage of gross revenue. There have always been some formulas out there that people have looked at. And those those formulas are all based on 2019 numbers.

And yet we had a significant shutdown in March, April and May and people coming back in June, July. And while a lot of the practices have come back strong, it's still causing concern. In fact, Art and I on the B of A meeting and Jodi said that their internal polling of thirty thousand and I hope I'm not getting this wrong. Thirty thousand dentists was there were sixty five percent of the industry, back to sixty five percent open 19 numbers and the A.D.A put together some number and the combined two was around sixty seven percent. So I think Art and I are seeing a different I got most of my clients are back at 110 percent.

Art Wiederman, CPA Yeah. Most of my clients are in the seventy five plus percent range. I think what you and I talked about, Lee, you're the one that actually brought this up. You know, the practices that do you know, Medicare, Medical, welfare, dentistry, they're not going to have a lot of change because it's a government funded program, the ones that are the high end fee for service, maybe fee for service, Delta Premier or maybe fee for service with not with no insurance in network, they're going to be in pretty good shape. I've got a practice right now that we're selling in Orange County that I mean, who's averaging, you know, 80, 90 thousand a month. He's done $130,000 the first two months and patients are banging his door down to get in. So it's the ones in the middle that you were the one that brought this up to me. Right? Like the ones that have the PPOs. And maybe you're dealing with people that are, you know, not as economically well off and are on unemployment. Now, the unemployment's going to run out at the end of the month. Right. Isn't that we talked about?

Dr. Lee Maddox Yeah, absolutely. I mean, so there's there's a whether they're back to 67 percent or 75 percent or 100 percent, patients are coming back to the dental office and we knew they would. Right. So they came back to the dental office. And what we saw was a lot of backed-up work need to be done. I mean, a large volume practice doing two hygiene visits a day, five days two hygienists working five days a week over three months. That's like six or seven hundred missed appointments. So we're seeing a lot of practices that are catching up on hygiene. And then and that will generate new work with hygiene checks. We'll see. More operative restorative work must be done. So we are seeing the practices. They're busy. Our concern is that, ah, how long is the busyness going to last? And as Art just mentioned, if the unemployment goes, they don't renew it. And I think the Republicans have a plan now. Where do they get it done before the Senate goes away or not? I don't know if they're at a trillion dollars that Democrats are to three trillion dollars. Seems like a pretty big gap to me. But there'll be some kind of stopgap measure that I think is probably going to push the unemployment benefits a little bit longer when it's something like 70 percent of pre termination or salary or whatever they were before they went out, really got before they got put on furlough. So it won't be the six hundred dollars, but it will be something. But anyway, some point. The point is that, as Art said, the hiring practices people. Everybody knows insurance only pays a small amount of money. Thousand fifteen hundred dollars for the larger practices is with the more esthetic cases, those people are still paying for the cases. And in the group that we're working, the mom and pops that are working with the PPO insurances that are making, you know, 50 to $150,000 dollars a year, you know, they're stressed. They still have student loans to pay. They still have health insurance to pay. Maybe their jobs got terminated. Maybe they're getting the six hundred dollars extra unclaimed benefit. But coming in and paying the co-payment on a dental procedure is maybe not in the cards. So we're certainly seeing some issues here. So what does this mean for sellers anyway? Let's get back to the question when what does this mean for sellers? So if you're thinking about selling your practice and we don't know how to truly value practices, what is it? What is the impact? You put your practice on the market now and you try to sell your practice at pre COVID-19 numbers. So Art and everybody else who's doing practice valuations, they're going to put in some disclaimer in their valuation that this is the value of your business. Disclaimer looking at 2019 numbers and before and we don't know how to factor in this last 3 months shutdown. And so if you put your practice on the market now, you have a chance of getting a price close to what your valuation is, what the 2019 pre COVID numbers. If you're in the higher end range of the better practices, the lower in range of the practices, you're going to probably have a much different, more difficult time. The middle five, six, seven hundred thousand dollar a year practices, they're going to sell pretty well because that's the sweet spot. And but there might be some discounting. The problem is as if you don't pull the trigger now and you wait till January of next year, Art will tell you that we're going to have a 2020 tax return and that 2020 tax return is going to show lower revenues. And when we have that lower revenue, we're going to be looking at tax returns 18, 19 and 20. And your practice value could potentially be much less than it is right now where we just say we're paying. We're doing it. We're selling the practice based on Pre COVID-19 numbers. Knowing that the practice was shut down for three months. But we expected to come back, whereas later we're saying, well, it didn't really come back. Here's our actual numbers greater.

Art Wiederman, CPA Well, what I'm what I'm hoping is going to happen, and this is something that was on the webinar that you and I were on yesterday, is because that question, if you remember Lee came up, is like, what are you going to do in 2021 when you look at 2020 numbers?

And the answer was, was, well, you know, we're going to look at what happened before and we're going to you know, and we'll look at what happened when you opened up. And if it's looking really good, we're probably going to loan that. That's what he said. But we don't know whether the banks don't lead, the banks don't know what the banks are going to do. Right.

Dr. Lee Maddox And I think that's the critical part, is that.

As a group, we're optimistic because unlike other industries, we do it ourselves, right? We are hands on people. We work the practice. We do the actual dentistry. So we are actively involved in the process. And so we know we can make it work. So we're very optimistic that we can make it work.

And the buyers are hungry. The buyers that worked for corporate dentistry and in multiple offices are looking for a little bit more stability because they got furloughed from the larger groups. Yeah. And they'd rather have they'd rather have their own practice now and control their own timing. And when they work and when they don't work. Some of you know, you work through COVID-19 shutdowns, you get emergency treatment.

So but the point is the dental lenders have changed and everyday it's changing. And this is this when I say that sellers right now are the most frustrated I've ever seen them because the transactions are not linear anymore. It's a dynamic event because the lenders are changing their rules, because the lenders are very concerned. When we deal with the lenders are three groups of people. We have the salespeople that want to do the loan. We have the underwriters that want to make sure the numbers can support the loan. And then we have the person sitting back in the corner of the room who's the risk manager. And the risk manager has got his hand on his chin analyzing, saying, does this fit our program? Does it not fit our program? And if it doesn't fit our program, we're not doing the loan. And so the risk managers right now are very, very concerned. Here's the point. Pre COVID-19 B of A was lending 100 percent financing. A good majority of it deals. I don't know what percentage, even a large percentage of their deals. They were doing 100 percent financing. Per Jody Nikola yesterday, he said they're back in the market. They're going to lend 75 percent. So what that means is that the lender thinks there's a higher risk of default and because there's a higher risk of default and our collateral is fairly weak. They don't want to have as much skin in the game. They want the seller to have skin in the game so they'll end up with 75 percent. And if we can meet the lending requirements, which is debt coverage ratio, one point to five dollars and one point two dollars of profit of net income against buyer liability, if there's one point two dollars a profit, a deck average, one point 20 and they lend seventy five percent, they will allow us to do a promissory note up to whatever value we can get as long as it doesn't throw off the debt coverage ratio of one point two. So what they're basically saying is we want the sellers to be involved. Right.

Art Wiederman, CPA And the values are going to. Now, remember, folks, and I've said this for years, Lee, is that, you know, what a bank agrees to lend is not what the value of the practices, but in the buyer's mind it is. Well, you know, this bank won't lend more than eight hundred thousand. That's all you will know. That's not what's worth. It's what that underwriter and his supervisor or her supervisor say that this is worth. But that's what the buyers have in their heads. But, yeah, you're absolutely right. And what I've been seeing is a broker here just looking at some of the transactions that we're working on. And we've got some that are probably going to close this year is that, you know, buyers are coming back with this. OK. So we'll give you a six hundred and fifty thousand, but we want to do a hold back. And it's based on, you know, three times PI minus how many times SpongeBob has cheeseburgers. I mean, they come up with all these formulas. Right? Is that what you've been saying?

Dr. Lee Maddox OK, so I want to go back to one thing you said Art. And we'll pick up all the different strategies and how we get the transaction completed. First is the debt coverage ratio calculation. There's only one part of the equation that the seller controls, and that's the net income. The other part of the equation, the below the line, below the denominator is controlled by the buyer and the buyer's debt. And what the average student coming out with goes to three thousand dollars debt service, student loan without any other lifestyle issues. The fraction gets messed up if the buyer has a really high, you know, high number there. So Art is right. The value that the that the lender says, the amount the lender says they're going to loan has nothing to do with the value of the business. The value of the business can the amount of the loan can change with different buyers. For example, if someone comes in that has almost no debt and there's strong net, you'll get to the one point 20 a ratio problem. If the buyer has the same practice and we bring a buyer that has a lot of debt, then we might fail. We won't hit the one point two. Oh, that doesn't mean the practice isn't worth the million dollars. It just means it's not it doesn't meet the cash flow requirements for this particular buyer. So I think that's important that art brought that up. So how do we get a deal done in this? Yeah, I guess I guess that's the question. So you know what? What happened when this all the deals that were in place when this transaction, this whole COVD-19 went down, many of the transactions just stopped. So the the buyers just said, I'm out, I'm not completing the transactions. And they walked away. Some of the buyers said, we're going to continue with the practice and we're going to keep the same pricing because it's the right fit. It's the practice in the right neighborhood. It's got the right number of operatories. I like the feng shui. I like the pictures. Whatever it is, it's the right fit. It's what I've been waiting for. I'm not going to let this opportunity go for 30, 40, 50 thousand dollars. I'm going to work there for 30 years. It means nothing to me. Fifty thousand dollars over 30 years. I'm going to buy this practice. And then there's a group of buyers that said, you know what? I'm going to be a predatory buyer. I'm going to come in and I'm going to try to steal it. I'm going to try to get a couple hundred thousand dollars off and just kind of really grind the price. And so somewhere in there, there's some different dynamics. In the group where the doctor says, I'm going to keep the price. There may be a nuance to get to the finish line. And so the nuance is, if the bank isn't going to win 100 percent of the money, how do we finance the practice? If the bank says I'm not going to lend 100 percent of the money. So it requires either the seller carry a note, a promissory note, or we might have to do what we call a hold back.

Or the third option is, as I mentioned already. Maybe somebody just cuts the price down and we pay less. So the practice on the market for a value added, a million dollars. The buyer says he's going to pay a million dollars. COVID-19 happens. Now they come back and say, oh, I'll pay you eight hundred. Or the buyer comes back and says, I'll pay.

It will only give me 800 you carry it over two hundred thousand dollars. Or the buyer comes back and says, you know what? I'm going to give you eight hundred thousand dollars and I'll give you two hundred thousand dollars more if certain criteria are reached. We will call that a hold back, assuming if they get the full million dollars. So there's some way to support it. So a holdback will typically be tied to some kind of performance of the practice and some kind of requirement that the doctor works. So if you're working with a large DSO who is acquiring the practice, they almost always want the doctor to work back for one to two years and they almost always want to have some kind of production or collection criteria over a period of time. The problem that we're having is that holdbacks with DSOs work and they work because they have private equity money. So they're funding the transactions one hundred percent cash. So they come in and say, I'm going to give you the million dollars. Here it is. We're going to let you keep eight hundred of it now. We're going to put two hundred thousand dollars in escrow. And if you hit one hundred percent of revenue the next three years and you work 150 days the next three years each, we're going to give you that other two hundred thousand dollars. That's an easy transaction for me. It's easy for Art and we don't have a lender. The problem we're having now is people are wanting to craft holdback language and holdback transactions with lenders that don't know how to do it or don't want to do it. Now, if we go back 10 years, 12 years ago, we had a bank that liked holdbacks, but they would make the seller take out a C.D., don't know if you heard this Art. They had to take out a C.D.  And the bank held the C.D. for the two hundred thousand dollars, which is completely frustrating. My seller had no control of the CD. We never saw it. They got the money back. You would know if they got the money. I don't know. I did the transaction. I was out of it. But now, right now we're dealing with banks and they're they're good lenders are good people, but they don't know.  They're concerned. Like, wait a minute, you want us to fund 100 percent of the transaction and you want to leave two hundred thousand dollars in escrow well, is the escrow bonded? What if the escrow was out of business? How do we protect the two hundred thousand dollars? I mean, we bring up a ton of issues. And the lenders are just not comfortable with it. But is it better to do a hold back or is it better to get less money? I mean, obviously, you want to get as much money as we can. And if we can't get the bank to do the holdback, allow the holdback model and we don't want to take a price reduction, the only option we have is take a promissory note and be a bank.

Art Wiederman, CPA Which would you have told me over and over again is basically if you sell your practice for a million dollars and you get eight hundred of cash and a two hundred thousand promissory note and you're the one that taught me this years and go tell your client that they're selling their practice for a hundred thousand because they may never see that money because it's an unsecured note. Let's take a break for one second. I want you know, Lee, as you can tell, Lee is a shy young man and he doesn't talk much, but he is one of the most knowledgeable people in this industry. I can guarantee you that. And he is one of my truly go to people. I was thrilled when he came at a brokerage and went back into the law. So I will.

I'd like Lee, if you would take a second and give out your contact information to everybody. So and it will also be on the show notes on Eide Bailly's Web site. But Lee, how if someone wants to work with you, how can they get a hold of you?

Dr. Lee Maddox You send e-mail to Lee@MaddoxHealthcareLaw.com. That's the easiest way to get a hold of me.

Art Wiederman, CPA [00:41:27] And if there's a problem and you know, your search engine can't hold that long of an email address, just call or e-mail me. I'll get you in touch with Lee.

Dr. Lee Maddox Let me give a telephone number too. 949.675.1515 or 415.361.4045. Go ahead.

Art Wiederman, CPA So, we talked about sellers. And I guess the conclusion of the sellers, Lee, is that they just have to be prepared for negotiation and for all kinds of fun stuff that could happen as opposed to, you know, when we used to list practices before this and they were really good practices, we would get multiple offers and they'd be bid up. And that would be really fun for the broker and the seller. But it's it's a completely different animal. So, Sellers, you need to be patient. I know you want to get out, but we're in the middle of a pandemic. So let's let's go to the buyer side. Now, Lee. All right. So you get a young buyer they're three, four years out of school. They've been working at a clinic or a big box place, and now they're ready and they want to buy and they are sick of it. So buyer comes you says, I want to buy practice. What do we need to be looking at? What what should they be careful about right now?

Dr. Lee Maddox Well, again, I think the buyers on the other side have to be looking at the practice valuations and saying, is this practice worth what they're saying it's worth?

And this is always coming back to this idea of what are we really buying when we buy a dental practice. So what we buy when we buy a dental practice is we buy tangible assets, things we can touch and feel like equipment and we buy intangible assets that that that that fuzzy stuff that you can't see and touch. And an intangible asset that we're buying is goodwill. The IRS definition of goodwill, is the expectation of future business. I define goodwill as the momentum of the practice. What is the driver and this practice that keeps the momentum? So when I'm looking at dental practices, I think when a buyer looks at a dental practice, you should be looking at trends. So if a trend is the numbers were higher in 17, higher in 18, higher in 19, then if 20 is down because of COVID-19, I'm not so stressed because the trend on the practice, the momentum in the practice is there. So what's driving the momentum? The hygienist, the calling the patients, not making them wait in the room, not hurting them, the high quality dentistry, exceptional cleanliness, whatever the driver is, good marketing, whatever you think is the nuance that makes your practice successful. If that's communicated to the buyer and it supports the trend, then that good will that momentum will continue. And I think the buyer should be focusing on that.

If the reverse is there, where the 17 is higher, 18 is lower, 19 is lower, and then 20 is even lower, then I think you have to be more concerned as a buyer because we have a practice that's declining.

And again, we have to look at why is the momentum changed? Why are we getting less patients per month? You know what what has changed in the practice that we drop insurance plan? Did we did we did we change hygienist? Did we change associate dentists?  Did we raise our prices? Did we change our location? Did we demand payment or we didn't demand payment? What are the nuances of the practice that makes the practice successful? And this is a short conversation with the sellers. I think sellers are very proud of their practices and ask them and say what is special about your practice? It's not the dental chair. It's not the five oratories. It's not the waiting room. What is making patients show up here year after year? Why do we have two, three and four generations of families showing up to this practice? And what can I do as a buyer to keep that momentum going? And I think that that's where the focus needs to be.

I'm not a practice consultant and you can go get advice and practice consultants, but I see people drill down on the numbers and they get so worried about 30, 40, 50 thousand dollars. They miss the big picture. The big picture is how do I capture the momentum? How do I sustain that momentum? Because I'm buying this practice for 10, 15, 20, 25, 30 years.

So in this environment, my advice to buyers, if you find what you like, buy it. Pay the seller what he wants and transfer the goodwill. Now, the buyers are saying, why would I do that if I don't know what the value is?

Well, the answer is if you don't find what you want, you don't have to buy it. No one's going to force you to do it.

And I'm thinking about something. The sellers I was going to say earlier, if you don't sell it this year, you've probably got to hold your practice for a couple of years so we can see 2021 tax returns and 2020 to tax returns.

And we can see that you recovered from the COVID-19 closure and that your practice is back up to the normal levels.

And we're getting the number of patients per month that we used to get and all the momentum nuances are in place. So if you're a buyer and you're buying the practice now, you're obviously going to be concerned about Delta Dental and whether they're premier provider or not a premier provider.

And you're going to be I think you'll look at A.D.A code production and collection reports and provider reports, you know, a typical dental practice will have a third of revenue done by hygiene. But look at the look at the production and collection reports. If the dentist in 2017 was doing 50 percent of his business in restorative and in 2019, he's got a huge spike in revenue and he's doing 80 percent of restorative, there could be a problem there. There may not be a lot of dentistry to do if all that restorative work is being done. So from the buyers, I think that you have to analyze A to Z, get the production and collection reports, look at the zip code analysis report, the practice summary reports and and really get a feel for AR reports and credit bounce reports and really get a feel for why is this practice successful? How am I going to keep it successful? Now, I just had a transaction where the transaction closed and I'm going to come back to Delta Dental.

But the doctor who bought the practice couldn't become a Delta Premier provider. So she changed the compensation models for all the hygienists that had been there 20 plus years or so. So all the hygienists have left and the patients are bleeding. People are leaving the office. So this person, instead of understanding what I said was, I'm buying goodwill.

I'm buying momentum. I'm going to capture that momentum. I'm going to do what the seller did.

I'm going to slowly move the practice over the way I operated over a year or two. At least one to two or three to four, you know, hygiene appointments and the patients are one to two years of getting to know the patients, then making some nuanced changes.

Why not buy that momentum where you're doing a million, a million and a million two versus go in and just shock the system with putting in new policies? I understand you're paying a lot of money, but when you shock the system, you run that risk.

So, OK, so let's talk about Delta. You want to talk about Delta?

Art Wiederman, CPA Well, there's a couple of things I want to talk about, because we're going to run out of time here any minute. But so as we all know, Delta is the eight thousand pound gorilla and that Delta had, you know, four or five years ago I had them into my office with several people and we talked to them. And at that point there were 8800 in California, 8800 premier only providers. And Delta basically made the rule that said, okay, if you transfer your practice, you have to accept the PPO. And ninety nine percent of the patients who have Delta insurance are on the PPO because businesses can't sell a premier package, although they would love to close. It's a very profitable thing for them, but nobody will buy it. So what happens is they end up taking a hit. And so, you know, now I'm going to I'm going to open Pandora's box with you as you reach through the computer and rip my lungs out, because you did this one time when we were lecturing together at A.D.A. So we talked to doctors about doing specialty procedures Mr. Endodontist. I know you have an opinion on that. So talk about Delta. Talk about ways people can make up for that.

If they know. If they know you're not a consultant. But what's yours? Well, you know what we're telling doctors and then, you know, doing specialty work. And again, I'm talking to a recovering specialist. So talk a little bit about all that.

Dr. Lee Maddox Don't get me started on the American Association of Endodontists.

That would be a long conversation.

So, OK, so this is what buyers hear is when you buy a practice, you're not going to be a Delta Premier provider. That's a false statement. The true statement, is when you when you submit to become a Delta provider, you can become a Delta Premier and a Delta PPO provider at the same time. So I think it's called Delta Premier Plus. If I have the name wrong, I apologize. But when you get the application, there's an addendum to it.

And that addendum is for Delta Premier, an addendum provider. And so what this means is, is that after the transaction closes, you can bill Delta Premier patients to premiere fees and you can bill the PPO patients PPO fees.

So backing up, what do buyers need to look at the when the buyers are buying practices? The question is always how many Delta Premier patients there are. So that's a fair question. And they can get that information for you. Then the question is how many of those patients are premier and how many of those patients are PPO? That's a good question.

The third question is, does the selling doctor charge the same fee for premier and PPO? In other words, if the selling doctor works on a PPO patient and charges a 100 percent fee, does that patient pay the co-payment to pay the same fee as a Delta Premier patient? So those are the three important questions. If the seller isn't charging patients that are PPO patients the premiere fee, there's no problem.

So if the seller has let's say the seller is doing a million dollars, they probably have somewhere around five hundred Delta patients, 400 to 500 Delta patients.

They'll probably have 30 to 60 premier patients. The rest are all PPOs. So if they're charging the PPO patients the premiere fee, then they have essentially for all purposes, five hundred premiere patients. If they're charging the PPO patients the PPO fee, then it's a nonissue for the buyer because when the buyer signs up for Delta, there'll be a premiere provider and they can charge premiere fees to the premiere patients and there'll be a PPO provider and they'll charge the PPO fee to the PPO patients. Where it gets concerning for the buyers is when the seller is charging the premiere fee to the PPO patient, which is legal when you're a premiere provider. So that's where the drop in revenue is. Is that when a buyer buys the practice, those PPO patients they're going to have, they're going to receive less dollars per procedure and that's a fairly tough calculation. People say it's somewhere between and Art what you say 20 to 30 percent drop per procedure. I don't know what you say, but.

Art Wiederman, CPA Yeah, it's basically the way the numbers work if you have them. I've done this if you have a million dollar practice and it's 25 percent of the patients are Delta. And you just assume that virtually all of them are PPO patients. Basically, if you take you know, and you're going to go from 90 percent of UCR to 60 percent, that's what I usually use as a 30 percent drop. So you take 30 percent drop on two hundred and fifty thousand dollars, you're losing eight. Yeah, I talked to some of the consultants. They use eight percent of the revenues. Eight percent of the revenues is what you can expect to lose if you are a if it's a premier only office.

And now you are going to be have to go in network and you don't have to go in network. You can choose to go out of network. That's a whole other podcast. We won't get into today. But that's about the math, Lee, so, you know, and the sellers and the brokers and I want to before we leave today because we're getting close to the end of our time, I want to talk about brokers and how to deal with brokers. And you know, what they do. And, you know, it's like there's good players and there's better players in every business. But you know, this is something this is a main issue. But the sellers are not discounting practices because they're Delta Premier.

They never have. Right?

Dr. Lee Maddox Right. And so I'm going to go back to your eight percent. So if that, in fact, is the rule eight percent. If that's the suggestion, then the question is. Are we overpaying if we pay the price the sellers asking for? And if we are, what can we do about it? If the seller doesn't want to reduce the price, you end up buying it or you don't buy it. Right. And if you do buy it, how do you make up the difference? And this is where the question are teed up for me is what do you do? And I think this is, you know, when it's commonly said to buyers out there is to take a look at what work is being referred out and do that work. So I have a little bit of issue that being a specialist, really, I advise people to do what they can do competently. So if you're if the if the sellers are referring out upper second molar endos and you don't feel competent doing upper second molar endos, then why risk losing a patient and three generations of the family by working on something that you're not competent at and getting sued. Or if you're doing an impacted at lower wizzy and then you get some nerve paralysis. Or if you're placing implants and you, whether you use a surgical stent, or don't use a surgical stent or maybe you're using a cone beam or maybe you're not using cone beam. I mean, do what you're comfortable with. And so in. And by the way, a lot of your trained dentists are amazing and you got extra training in GPR, you've worked in some corporate offices and you've really stretched it. You do a lot more than, you know what, the average dentist did when they get out of school 30 years ago.

So maybe you have a higher level of competence to do these procedures. But the key is, if you feel confident with it and you look at it and you see that, you know, some of these procedures you can't do and you can do them safely, then you can make it up that way. But what I see is the simple issue is just work more days. And I certainly don't know the percentage anymore. I used to have a slide on this from A.D.A. But most of the dentists in this country work four days a week.

Art Wiederman, CPA That's about right.

Dr. Lee Maddox So when you're young and hungry, you can pick up the eight percent or maybe not you being the math guy Art. But I think you can pick up the drop in revenue by working five days a week. So work five days a week. Work hard. We hope that's how we all did it. We worked hard, work long hours and get in there and make it up.

Art Wiederman, CPA And see. Here's the other thing Lee that I see is that a lot of these doctors who are in their 60s and 70s that are selling. We ask what kind of marketing do you do? We don't do anything. We're getting eight or nine new patients a month. And it's all word of mouth. Well, there's this thing called social media. There's this thing called Google. There's all the marketing you do. I mean, just how many senior doctors that I deal with, they just don't ask their patients for referrals. I mean, how simple as that. So there's a lot of opportunity out there.

Dr. Lee Maddox But I think one of the things that I used to do a whole bunch of practice valuations in my prior job, and one of the things that I could pick up pretty easily is when I saw a drop in revenue. I could tell you within a month or two when the selling doctor stopped doing hygiene checks. So it's silly, but most hygiene departments are broken. They you know, if you have fifteen hundred patients, you should have 3000 hygiene appointments a year.

But if you have one hygienist working eight hours a day, you're doing about twelve to fourteen hundred hygiene appointments. So you're doing 50 percent of what you should be doing. So, you know, a simple thing is, is it to look at these practices when you ask the doctor if they do hygiene check and how strong is their hygiene department.

So some of these practices, they're focused on big cases and they're going to and they're Delta Premier, but their hygiene department could be run significantly better. And that's where the dental consultant comes in and they analyze the practice and they say, you know what, the hygiene could be better. You can have an extra 800 hygiene appointments a year, you know, and if you do the hygiene checks, that's going to drive more revenue. So I think really the critical issue is, is that as we practice over the years, we get tired. And there's a point where we just say hygiene checks, forget it. And when you stop doing the hygiene checks, practice revenues flat line or start to decline. And that's why I say looking at trends are really important. When you look at when you start looking at their ADA code, a production code reports you can see that hygiene staying the same year after year after year after year after year. How is that possible? How can hygiene be the same for 15 years? If you're putting on 15, 20, 25 new patients a month every single year?

Art Wiederman, CPA Because a bunch of them are walking out the back door.

Dr. Lee Maddox Yeah. So I think there's always room for growth and getting a good practice consultant in there and you know who they are can come in and analyze and help them out.

Art Wiederman, CPA So the last thing I want to talk to you about today, Dr. Maddox, and again, you and I have been friends for 30 years. I have such great respect for you. And we could talk for days about all kinds of stuff. And we have. What about my dentist who wants to take over the world and wants to. I mean, I get it calls about, you know, once every three months. So what's your goal? I want to own 50 practices in the next five years. OK. Sure. So. Talk to doctors who are entrepreneurial and they want to own multiple practices. But what advice do you give them as far as you know, how did I mean, again, it's a whole nother podcast. But what are you seeing?

Dr. Lee Maddox Well, I think what's interesting is in the last five to eight years, there's been a big push for multiple practices. So you have to ask yourself who's pushing this the most? And the answer is the dental supply companies, the large dental supply companies want more DSOs with more ownership of practices. If you're in the dental supply business, would you rather have a client that owns 300 offices and you do a million dollars a year revenue in? Would you rather have 300 offices where you're doing a thousand dollars a year revenue in? So what happened over the last five or six years that we've all been manipulated and we've been manipulated by these large dental supply groups and into believing that multiple practices is the way to go in. And so there's a lot of lecturing going on out there. And there's groups of people that do this and they claim very high returns on dollars. So 10 to 15 percent revenue on a practice. Right now, Art will tell you that when you operate a practice as a sole proprietor, you're going to have somewhere depending on how you're operating the practice between 60 and 75 percent overhead, 65 to 70 being in the normal range. So you're making 30 to 35 cents on every dollar that you produce. If you run the practice absentee. And you have to have an associate. So when you pay that associate, it drops your revenue down. So I think a normal doctor that has multiple practices with associates is going to run somewhere between five and 10 percent of revenue. And I'm thinking eight is the number. So if you own a practice, it's doing a million dollars a year, you're going to make eighty thousand dollars owning the practice. So if you want to make eight hundred thousand dollars a year, you have to have ten practices. The problem is, is how do you get the money? And this was a problem before pre COVID-19. So what happens is, is that there are few lenders that want to do multi practice operations back even. The question was asked to B of A yesterday, "are you back in the multi practice business?" The answer is yes and no. Yes, but we don't want to go to 30, 40. Maybe we'll do five to 10, but we got to really look at it. There's a lot of ifs. So the problem is, is if you don't get the money, what do you do to differentiate yourself from everybody else in the community? And these really successful groups like Pacific Dental some of the larger groups, they spend a lot of money in advertising. They have a lot of revenue because of that. And they have a lot of backup money from P firms. And I can't talk specifically about any other civic companies, including Pacific Dental. But what I find happens is my clients, they have one practice and they're very successful. They go to two. They're very successful. They go to three and they can't quite make it. So at 2.5, two point six, one doctor has a tough time running three practices because we're starting to get to the point where we're driving multiple associates and multiple hygienists and it's difficult to keep everybody happy. I think the critical thing that makes the DSOs work and I'm not the expert on DSO is you have to get to a point where you can get a corporate office with a good corporate team where you have you know, some quality controls and some CEO, some CFO, some, you know, some insurance people. You're answering the phones. We have internal billing.

And in that corporate office could cost you a million or two million dollars. And so it's very hard to get there. So what Steve Thorne did was amazing. What some of these other companies has done is amazing. And I think we all we'd all would like to reproduce it, but we can't drink the Kool-Aid and think that we're going to open practices and have 15 percent return on revenue. And because it's just not that easy to do. And I'm unfortunately, I'm always wanting to buy the practices. I can't get it out of my system once a dentist, always a dentist.

Art Wiederman, CPA You've been talking about it.

Dr. Lee Maddox So I'm always looking at practices, thinking I want to buy a practice. And I go in and I analyze the number and I analyze the numbers with an associate in there and the practice doesn't make as much money.

Art Wiederman, CPA And the headaches.

So anyway. Hey, listen.

Dr. Lee Maddox People can do it and it does work out. You just have to be really committed to it. And, you know, I've talked to a guy the other day that has 11 practices and they're doing well. It's not that it's impossible. Just a really good vision. And I will tell you that if you're going to build something to sell, make it like McDonald's. And what that means is make it a very consistent operation so that if you walk into one and you walk in the next one, they all look and feel the same because the people that come in and buy these practices that are going to be the high multipliers want to see that. That's what the business community likes. That's what you want to sell? Well, that's the quick answer.

Art Wiederman, CPA So, folks, I will tell you, as you can tell, that, like I say, Dr. Maddox is a shy, shy man and he doesn't talk a lot, but he is a wealth of I say that affectionately. He is one of the smartest guys I know. And if I have a problem with a transaction or something and Lee have not done this many times, I say, you know, Lee, I'm a smart guy. But you are most days smarter than I am. And he's usually got the answer. So one more time, Lee give out your contact information, the email and the phone number, please.

Dr. Lee Maddox Yes. Lee@MaddoxHealthcareLaw.com. And 949.675.1515. And thank you very much. Hopefully I didn't offend anybody today. We covered a lot of topics really quickly. If you have some questions, send me an e-mail and I'll try to answer it or contact my administrative assistant, Jill, and she'll schedule a short call.

Art Wiederman, CPA And if Dr. Maddox has offended anybody just e-mail me at ArtWiederman@gmail.com and we'll have a conversation. I'm just kidding. If you want to get a hold of me at my office in Tustin, I'm at 657.279.3243. My email at is ArtWiederman@gmail.com and now also at my new in my new life, it's awiederman@eidebailly.com .

Go to our website eidebailly.com and look at all the podcasts and our dental pages. We have tons of stuff, some of it I've written and just a lot of really, really good stuff. And, you know, Eide Bailly is a great firm because they have virtually any industry that you are in if you have a spouse or a cousin or something, you know. We can handle it now. It's wonderful.

Go to our Decisions in Dentistry partners, web page www.decisionsindentistry.com and subscribe to the magazine. If you want a 30-minute complimentary consultation with me or one of the other members of the ADCPA, mark the box on their front page. And if you're looking for a dental specific CPA anywhere in the United States, if you want Southern California, that would be me and my team. And if you're looking anywhere else, go to www.ADCPA.org.

Dr. Lee Maddox. I value your friendship very, very much. It's always fun to talk to you. And thank you for taking the time to come on today.

Dr. Lee Maddox Thank you. And I do as well.

Art Wiederman, CPA Appreciate it. And everyone. That is it for this edition of The Art of Dental Finance and Management with Art Wiederman. Please be safe. And remember, my five word mantra for this time in our lives this difficult time. Failure is not an option. Do what it takes. You've worked way too hard and accomplished way too much to let a public health crisis get in the way of your long-term success. Take care, everyone. See you next time. Bye-Bye.