A Portfolio Company (PortCo), backed by a private equity group, acquired a high-profile private practice in the field of plastic surgery and medical aesthetics, including a certified surgery center. New to the sector, PortCo sought to enhance the practice’s growth strategy and operational efficiency. To kickstart EBITDA growth and identify quick wins in value creation, an operational assessment and implementation plan were needed.

Situation

The practice’s growth had plateaued, primarily due to an outdated management style, not rooted in accountability and staff motivation. A stark performance discrepancy among providers was also evident, with one provider performing at the 90th percentile while others lagged at the 25th percentile, creating a perceived obstacle in expanding med spa services.

Solution

The client engaged VMG Health to conduct a comprehensive operational and value creation assessment, focusing on the patient journey and inflection points of opportunity. The evaluation led to several key initiatives:

  • Efficiency Dashboard: Implement a dashboard to monitor and manage key performance indicators (KPIs) such as provider productivity, revenue, and resources
  • Staffing Improvements: Identify roles for a patient care coordinator and medical assistant to enhance efficiency, patient conversion, and retention.
  • Wage Scale Analysis: Development of a new bonus structure and career pathing across the organization.
  • Leadership Development: Coaching for department and site managers and supervisors to refine processes and protocols.
  • Training and Development: Introduction of a teach-back method in training programs to solidify provider knowledge and foster a culture of accountability.
  • Career Pathing: Establishment of a three-tiered career path system for all positions to encourage growth and performance.

Success

Implementing a culture of accountability has significantly reduced the need for micromanagement. The practice has undergone a remarkable transformation, with a unified clinical support team driving productivity, patient engagement, and retention. This cultural shift and development of standard operating procedures have resulted in a doubling of top-line revenue within two years, marking a significant success in value creation on many levels. A four-tiered incentive plan was proposed to stimulate growth and reward exceptional team performance. Each level represented a different growth target, from achievable to ‘rock star’ levels, aligning incentives with the strategic goals. VMG Health updated job descriptions, Key Performance Metrics (KPIs), and standard operating procedures to support the new operational framework.

Contributor:

Mattie Remer