The Keys to Building a Successful Practice: Patient Education and Labs

Hello everybody, and welcome! I am Dr. Dan Kalish, and I'm here in partnership with Genova Diagnostics to talk to you guys about how to build successful functional medicine practices. And I couldn't be more excited to be working in this partnership with Genova. I'm going to be more excited to be talking to you guys about this, my favorite topic. I've been teaching all week too. We've had all kinds of doctors in my mentorship program and my various boot camps, and to watch people grow their practices, realize their dreams, raise their fees. I mean, the conversations just the last few days: three-month waitlist, you know, it's, and it's everywhere. It's Australia, it's Iowa, it's New York, and San Francisco. So functional medicine is taking off in a way which is incredible, and I can't even tell you how excited I am because I've been at this for 30, 31 years. And to see the new students coming into these programs I teach and have them have full practices like literally overnight, it's just a wonderful, wonderful thing. So if you're new to functional medicine, this is a great time to get involved. If you're contemplating getting into functional medicine, you should really check it out because this is the time to do it, uh, more so than ever before.

And today's class is about practical, business-oriented things because we've found over the years in training doctors and how to interpret labs that, okay, you're great at interpreting labs, but how's the business working? And you can't interpret labs successfully if you don't have a business behind you to do that. So that's what today is about, is arming us with enough information around the business side that we can run our practices successfully so you can help people. But this is about helping people, not about making money, for sure.

There is a boot camp that is an extension of today's talk that's starting on September 12th. If you're interested, you get a 20% discount as a Genova person if you use that VIP discount code. And, uh, you can snap a little picture of that QR code there. And the discount is extended out through the end of July, until August 1st. And so this boot camp is a one-month version of what we're doing, a one-hour class on today. And there's tons of information in there on financial planning and business planning and logistics and operations and all the things that you need to consider as you're starting your practice, okay? And so again, that's a one-month class that's starting in September, and it's one of our most popular classes most years. So if you're into it, sign up, you'll get a lot out of it. We have nothing but good feedback from that course, okay?

And then a little bit about myself. If you're brand new to The Kalish Institute, so I am Dan Kalish. I've been in practice for three decades. We've trained over 7,000 practitioners now through our different classes: telemedicine, functional medicine, lab interpretation, business skills development, um, kind of done it all. I've also been involved in science a little bit. We had the Mayo Clinic team for the Integrative Medicine department at Mayo in Rochester and in Arizona. Took the check my training program about nine, ten years ago now, and five of these doctors signed up for the class and took it. And he decided, "Hey, let's do a research study on this," because that's what they do at Mayo. So I spent a year of my life working with these Mayo Clinic docs doing a research study on the Kalish method. Turned out it works, which is great to sort of validate that with some objective measures. I now work with, for the last 10 years, with Richard Lord, who's the scientist that developed organic acids testing, amino acid testing, fatty acid testing, nutrient evaluation from the 1960s and 70s and 80s. He brought us the GI Effects test. He's long time retired now, but he and I work together quite closely on developing new curriculum for lab interpretation purposes, okay?

But today's talk is on a slightly different subject. Today's talk is about finding the roadblocks to building a successful practice and figuring out how to overcome them. And, you know, I go to IFM events a lot, and, you know, I'm there on an annual basis and then go to all the modules and all these things. And I run into the same doctors frequently. And the saddest thing is when they run into a doctor like a year later, I'm like, "Oh, how's it going?" "Oh, I'm still in the emergency room. I haven't really started my practice yet." Or, you know, "I'm still running my chiropractic practice. I haven't really started this functional medicine thing yet." So we want you to get started and to give you the tools that you need to make sure that that happens now, not later, but now. You know, if you're listening to this, hopefully, either you have a practice running and you want to improve it, or you're ready to start now. And we want to give you the tools either way to make your practice profitable and successful and fun, you know? Um, and then as part of this, we want you to be able to educate your patients to the value of lab testing by having your own clinical model and your own scripts for explaining the work that you do.

So when I was about year seven or eight of my practice, this woman came into the office. She had newly moved to San Diego. She's doing a PhD program. Her name was Barbara. And I've got to emphasize the part that she was from Texas, okay? So she, and I'm from California. So anyway, she comes into the clinic, she sits down in a treatment room, and she looks at me and she says, "I am fat, I am tired, and I am depressed, and I want to know what you're going to do about it." And she didn't say that in a mean way, but it was direct. Let's say it was a very direct kind of conversation. And so I panicked because I was like, "I don't know. What am I going to say to that?" And in that moment of panic, my entire clinical model crystallized. And Barbara forced this to happen. She and I later became really close. She was a patient of mine for many years. But what crystallized was, and what came out of my mouth, was all these things that have been floating around in partial format, and it just came out as a clinical model, boom! And because of that pressure. So I want you guys to develop some kind of internal pressure so that you have your own clinical model. What does that mean? It means that you have a philosophy and perspective on what makes people sick, why people get sick, and how people can heal, and that you can communicate that to patients in a minute or two, really clearly. That's what we're after. Because once you achieve that level of understanding, your patients will see the confidence and understanding on your part, and they're going to be enthusiastically embracing the recommendations that you make. If you don't have a philosophy, perspective, and model, it's just going to look, unfortunately, like you don't know what you're doing and that you're confused, and people are going to just wonder if they should even stick around.

Key concepts that most of us don't know how to start a practice. We don't have any business training. In fact, I had negative business training. I grew up in Berkeley, California. My dad was a professor, my mom was in, you know, hospital administrator. And in our family, corporations were bad, you know? Like I was anti-business, to be honest, when I started my business. And so we want you to have sort of an attitude where you're embracing the business. You realize that these are businesses for good. These are businesses to help the world. These are not businesses to rip people off, but their businesses nonetheless. And so success requires a business model and a clinical model. It's not enough to just develop your own clinical philosophy and model; you need a business model too. Um, and then the last bullet point here is that, okay, come on, like 30 years ago, it was actually a little, it was hard to do this because everyone was a little sketchy on functional medicine and integrative medicine. But right now, the numbers of people looking for the care that you provide are massive. And so it's very, I don't want to say easy to do this, but it's very straightforward to pull this off now, simply because the audience that's interested has grown so much.

The core concept that I want to, you know, sort of imbue in all of us, and myself included, is that we put equal time and energy into all three of these areas. I call them the three P's, and it's practitioner, that's you; patients, that's your patients; and then the practice, which is the business. And so that first P, P1 for practitioner, is you exercising, you meditating, you taking educational classes like this, uh, you having time with your family, you buying a new bicycle and riding a bike. That's kind of my thing, but whatever it is that you like to do, gardening, I don't care, but you having time for you and you developing yourself emotionally, spiritually, educationally, and not burning out. Patients, P2, comes second because if you're not in great shape, you're not going to help anybody. So then you want patients that you can help. You want to define who those patients are and how you're going to help them. You know, we can talk about that more in a minute. And then, sadly, you're running a business, so you have to put a fair amount of energy, like a third of your time, into the practice and the operations, the logistics, and the hiring and firing of people. And I mean, how many people on this call have a retirement plan? You got to set your retirement plan up. All those things have to come into place. Um, and what happens for almost all of us is that we put all of our time on the patients, and we don't look after ourselves, and we don't look down for our businesses, and then we end up getting stressed.

And we did this survey a bunch of years back on business challenges. 37% of respondents said their biggest business challenge was finding new patients. 20% said the biggest business challenge, that's like a Peter Piper kind of thing, business, biggest business challenge was patient compliance and retention. And then it went into like marketing problems, branding problems, fear of selling, all these other things. But you see, like the biggest category here is that we think that we need new patients, but the real problem is the patient retention. So almost every practice that we analyze has enough new people coming in; they're just not sticking around. And so that leads the practitioner to think that they need to keep bringing in new people instead of fixing the problem of people leaving too quickly. They're constantly looking for new people and trying to market and paying for all kinds of marketing things. That is not what you want to do. And we want to make sure that we reorient all of ourselves so that you have a good system for handling the patient so they stay around for many, many years. Then you don't need tons of new patients at all.

Clinical challenges. And again, from the same survey, managing complex patients, finding a community of interactive peers. So number one, managing complex patients. We'll talk about this, but you don't have to have a complex patient-oriented practice. In fact, a lot of practitioners that we work with, probably most of them, don't want that. They want to work with professional golfers, or they want to work with women that want to become moms, you know, like pre-pregnancy health, or they want to work with athletes, or older people, or kids, or, you know, thyroid patients, or, you know, does it? You can create a very specific niche of people that you work with. You don't have to manage the most complex patients as this sort of a default, okay? Many people may choose that as a model, but it doesn't have to be your model. And we find that for a lot of practitioners, nine out of ten of the people that come into my mentorship program do not want to and do not do well in a practice where they're managing complex patients. And yet, many of us think that that's what we have to do. So we want to break that framework and that, you know, that construct that we have to do. You can have an easy practice. You can have a wellness practice. You just work with healthy people if you want. You can work with any group that you want, and you should choose that group and not let them choose you. You want to be an agent of change in your own life and not just be like, you know, swimming in the ocean with the tides kind of pulling you around and the current's pushing you here or there.

And then finding a community of interactive peers. That's what The Kalish Institute was designed for, is to create a sense of community. And as much as I'm the teacher in all the courses in the various classes that we do, it's really the peer-to-peer learning and the peer-to-peer connection, I think, that makes the experience so valuable. And I'm trying to mimic that now with these online classes because it's a little bit hard for all of us to gather together in person, not just because of COVID, but just because of people's schedules and whatnot. So what we want to avoid, and what we do see happen in most successful practitioners, is physician burnout, exhaustion, cynicism, doubt. And when this gets really bad, people quit their practices. Every functional medicine practitioner that I know that's been in practice for over 25 years has had a period of burnout. It happens to everybody, but it doesn't have to happen to everybody. You can avoid that totally. Can avoid it, okay? It's doable. How do you do that? It's what we're talking about now. Is you figure out what you want to do. You figure out what's the practice of your dreams. One of my favorite doctors who I'm still in touch with on a regular basis, I won't use his real name, let's call him Mike, okay? So Mike and I met maybe 15 years ago. He had just graduated from medical school. He set up his functional medicine clinic. And I had this dinner with him, and I just tell him, "Hey, it's so great to see you. You're joining this community. I'm so glad you're here." And I was referring him tons of patients at the time. And, um, I was like, "Let's just, just be careful, Mike, you know, because burnout happens, you know? Like around 10 years, you're going to be burned out unless you do these things." Okay? We had dinners together once a year for all these years. Then we had one dinner, and he sits down at the table, and I'm looking at, "Oh my God, this is not good. This is what's going on." Like, and he's like, "Well, I'm quitting my practice." I'm like, "What? No!" He's like, "Yeah, he said, I'm walking away. I can't handle the pressure anymore. I got all these complex patients. I just can't do this anymore." And then I was like, and he said, "I know, I know, I know you told me." But look, I made it for 11 years, not 10. I was like, "Yeah, that's not the point." So you don't want to burn out. Burnout is the ending of your potential to help people. We don't want that to happen, okay?

So figure out what you're the best at, what you enjoy doing. Figure out what drives your economic engine so you can have a very comfortable living. I don't know any functional medicine doctors that have like a private yacht and a jet, okay? But we're talking about enough money to have a nice home to live in, put your kids in college, save for your retirement, those kinds of dollar amounts. And then figure out what you're passionate about. So every day you go to work, you're loving what you're doing. And you can completely avoid burnout if you figure these things out: what you're the best at, what you enjoy. What you want to avoid, probably is even more important. What the economics of the situation are, so your fees are reasonable, and you're making enough money to support yourself comfortably, and plenty of money to take vacations and take time off. And then you're doing something that you're passionate about. This is the recipe for avoiding burnout. If you miss any one of these three things, if you're super passionate, but you have to work 100 hours a week to make the money work, you're going to burn out, okay? If you're working 20 hours a week and you're not passionate, it's not going to work either, right? You need all of those things.

And so there's this sort of trajectory for functional medicine practices that I have observed. And I've learned a lot from working with different child psychologists because, you know, with human beings, there are these stages of life. There's like, you're an infant, you're a toddler, you're a teenager, you're a young adult, you're a middle-aged adult, and so on. And there's very predictable things that happen that are different in a toddler's life or a teenager's life. And anyone who is a parent is like, "Yeah, I know that. That's kind of obvious." But, you know, the child's psychology, people have studied this, and there's sort of things that are appropriate for each stage. And as I studying that work, I realized, "Wow, that's the exact same thing in functional medicine." From zero to five years, just like with human beings, there's this phase that everybody goes through. They're trying different things, they're learning and developing their skill set. There's pressure to make money because you're just starting, and you maybe you have debt from school or whatever, and you're building, and you're building, and you're starting to build your confidence. Around years five to ten, you've got your confidence. You're like, "Oh yeah, here's this Hashimoto's patient. Oh, I've had 100 of these. I know what to do." You may be adding in new specialties. In years five to ten, you've got a decent revenue base, but you're kind of thinking, "I want to make more money at some point, maybe work a little bit less." And then in that transition phase, when you're 15, 20 years into practice, you have new goals. And I talk to doctors every week that are in that position. They're 51 years old, they've been in practice for 20 years, and they're just like, they want things to change. They want to have different hours but keep their income steady. They have different needs. And as I kind of looked at these phases of building, growing, transition, from first year in practice to 20th year in practice, then I kind of applied that to the courses that we teach. The things that are important for business development in the first year of practice are identical to the things that are important for business development in your 21st year of practice. That may sound a little counterintuitive, but as we've worked with practices all along this spectrum, that's exactly what we've seen. In fact, we did a class about five years ago that was all senior functional medicine practitioners who'd been in practice for over 20 years, and they were all pretty much nationally known people. And they took this class together that I taught as a group, and they got more out of this basic business training program that we're doing in September than even the beginning people did because, you know, the mistakes that you make in year one get amplified by year 21, believe me. And in fact, probably the most appreciative group to that one-month business training that we're doing in September were the more experienced docs. So if you've been in practice for a while, it's, it's worth kind of revisiting these problems and issues and, and, and variables, okay?

So number one, again, creating a successful practice, maintaining your own health and well-being, we talked about that. Patients that are the right fit for you, and then a reproducible business model. Those are the three things, okay? So five elements in building a successful practice: creating your niche or niche, if you persevere to say it that way; weekly business planning, for me, every Friday morning, that's what I do. Sometimes it's 10 minutes, sometimes it's a few hours, but you have to have weekly business planning sessions if you're running a business. That's kind of obvious thing, but it's worth saying. Communication skills with your patients, how to perfect that, and then operations. And then you need some kind of a support network, either a business coach, and you do one-on-one, or you have a best friend that's also a practitioner that you work with, or you join some kind of a group like at The Kalish Institute, but you need some kind of network that supports you because you can't do this on your own. It's absolutely impossible. You'll make a lot of mistakes and you won't have any fun, okay? The more people that you surround yourself with, the more fun this is going to be, and less like you are to burn out.

So we're going to go through these pillars quickly and talk about each one. What is creating your niche even mean? So an area to emphasize or base your business around. Think about it. So all of us in the early years of functional medicine, and I came into this field in 1992, all of us, there wasn't any but concept of picking a niche. It was just like, you started a practice and you saw who showed up. And then as you got better, you would get harder and harder cases. That's kind of how it works for all of us. It never would have even occurred to us that we could focus on one area. But nowadays, because of the interest in functional medicine being so huge, you can do this. You can focus on the right patients in a whole variety of ways. You can do it through your website, through your marketing, through the public speaking that you do. You can do it through asking for referrals from your current patients. So, for example, if you have a female patient and you work on her hormones, and her hormones get better, you can ask her for referrals from her friends that may have similar issues. If you start to see your practice as a business and your patients as customers, just like for an hour a week, if every Friday morning for one hour, you just think about your business as a business and think about customers and how you want to structure the experience for them, and not that you have to treat everyone for everything. We have to kind of get out of our doctor mind once in a while in order to do the business part. So in the early parts of my practice, for about 10 years, my niche or niche was fat, fatigue, depressed, GI problems, and female hormones. Like, you used to call it the big five. These five things, this is really what I wanted to work on. Um, that was kind of nice. Now I have a wellness and longevity practice, so exclusively work with people who want to focus on wellness and longevity. We have patients from all over the world. I talked to someone from the UK yesterday. We had a patient from Kuwait. We have people all over the United States doing wellness and longevity. Turns out that that's an interesting subject to a lot of different people. For about a decade, I had a practice that was oriented almost exclusively around female hormone imbalances. For about 12 years, I had a practice that was focused on the brain and depression, anxiety, Parkinson's, OCD, ADD, ADHD. So I've had lots of different types of practices. You can change, you know, you can do like I did. You could do 10 years on female hormones and then go, "Oh, I want to do like a dozen years on, you know, the brain," and then go to a pediatric practice. So it's not a permanent decision, but you should make some decision about how you want to focus your efforts and energies so you have a clear perspective on what you're doing.

So now, the most common errors that we see is that people start their practices or they build their practices to the point where they're, they're just working with the hardest patients. And that's what happened to my good friend Mike when we had that final conversation before he quit his practice. He said, "I've helped a lot of people, Dan. And all the people that I helped have left my practice. And and all that's left now, after 11 years, are all the patients that I couldn't help, but they don't know where else to go." So he would show up every day in his practice and talk to people all day long who had been with him for five or ten years who weren't getting better, but didn't know what else to do. And that's why he burned out because he kind of focused on the hardest patients, and that was his entire practice. That's a recipe for disaster for nine out of ten of you. One out of ten of you will thrive with a chronic illness practice, and you just need to figure out if that's, you know, your passion, then you should do it. But if it's not, you don't need to. The second most common error is not choosing anything and just letting it happen. Again, that was the whole generation that I grew up with. We all just kind of did what we did, and it sort of happened to us. The other thing that's sort of tragic is that you have something that you love, but you don't pursue it. You know, and that is, I've seen that happen. People think it's not possible to do whatever they want to, but really, believe me, if you, if you love it and you're passionate about it, you can make it work.

So now, in terms of creating your niche, how do you actually do that? Okay, well, once you've picked your topic, and let's say you can do, I don't know, Hashimoto's or something like that, then you would find groups that are focused on thyroid-related problems, or you might find groups that have a lot of potential thyroid patients, like, I don't know, a yoga school, or any kind of a group of people that are gathering, a business group, right? In my example, I did it all with female hormones. You want to update your website and make sure that your messaging is consistent with what you're focusing on. You start to write a blog about this area of specialty, so every week, twice a week, maybe you post a blog post about the subject that you're really focusing on. And then make sure that you're asking your patients for referrals if your practice is already up and running. Now, once you've got that figured out, so you've, you got on it, let's say two or three areas that you think you want to explore, you've boiled it down to one area of practice that's the most interesting to you, then you want to start to plan and plan and plan, and then plan, and then plan, and then the next week you're going to plan and plan and plan, and then you're going to plan and you're going to plan. Financial planning, you're going to plan business models and business planning. And the more that you plan, the less likely you are to make some huge mistake. What many people do is they don't really plan, but they're really good at what they do, and they end up with this huge and successful clinic with really high overhead, and then things fall apart. And so that group of doctors I mentioned a little while ago that were advanced practitioners, nationally known, there's like maybe 18 of them that were in this business course that I taught, and again, all of them were names that you would recognize, they're all at the peak of the profession, very successful clinics, they all had super high overhead and weren't making any money except for one, okay? And so one had, really had the financial model figured out. So a lot of people become successful in functional medicine, but they don't figure out the economic model, even after 20 years. The key is to keep the overhead low, not to bring in a lot of money. And many people bring in a lot of money, but have high overhead, and so they burn out because they're just continually on this treadmill of needing new patients to feed this machine that they've built. So high overhead is just the death mill for almost every practice that we analyze. You really want to be careful, okay? So, and typically what happens is there's a lot of patients coming in, there's a lot of staff, the doctor in charge is not making much money, and it becomes problematic.

Here's a question for you. And I can see you. I mean, I can't see you like I don't have your camera turned on. It's not like creepy. I can see you, but I can see you, um, in that, uh, your names are there, right? And how many of you know what your margin was for 2022? How many of you can just say, "Oh, I had an XX margin for 2022." You could raise your hand, or you could type in your margin. That might be kind of fun. Everybody could just type in their margin into the little chat box. So I asked this question a lot when I do lectures, and then I usually follow it up with another question, which is, you know, um, raise your hand if you even know what I'm talking about. If you know what a margin is. And it's shocking how many practitioners are running a business and don't know what their margins are or what a margin is. So the margin refers to a profit margin. So you want to keep your margin between 40 and 60%. That means if you bring in $100,000 next year, you're keeping somewhere between $40,000 and $60,000 of it for yourself. And a good solid margin, an excellent margin is around 60%. If you're keeping 60% of what you're earning, you're doing extremely well. If you're keeping 40% of what you're earning, you know, you're doing okay, but you should get up to 60%. So let's say you make $100,000, would you rather keep $40,000 or $60,000? You don't have to work any harder, right? So if you keep your overhead low, you could keep 50% more money, you could keep $60,000 instead of $40,000, just by lowering your overhead, not by working harder. So low overhead is the real key. Every dime that you save on overhead comes back to you as like a dollar down the road. It's really true. That's an old adage that the CPAs have, but it's extremely true. I didn't really understand that for the first 20 years of practice, but now I get it. I'm like, okay, if you can save a thousand dollars somewhere, it's going to come back to you in a much larger dollar amount than that, okay, for a variety of different reasons. Margins, 40 to 60%. Shoot for 50% to get started with. And if you don't know what your margins are, talk to your, you know, CPA or your bookkeeper or your spouse or somebody who can calculate the margins for you. I don't know if you have a teenager, they could probably figure it out. Um, and margin is generally done before taxes. And the best tax strategy for all of us who are in our own practices is to start a retirement account. If you don't have a 401k or a pension plan or both, then you're missing out, okay? Missing out a lot. So make sure that you have a 401k in place and or if it's appropriate according to your CPA, a pension plan. And I had both for many, many years. I'm so thankful that somebody told me to do that because now I have a pension plan and a 401k, and I could probably retire today if I felt like it. Uh, if you don't, and you want to start that when you're, you know, as young as possible, you know, really, you do.

So then, in terms of patient communication skills, and this is oftentimes the crux of what makes a practice. So there's a lot of practitioners who are extremely good at lab interpretation and they understand functional medicine well, and then, and they're nice people, but they just struggle with the communication part. And so there's some key ways that you can motivate patients to buy lab kits. There's some key ways that you can learn how to get supplement programs completed so people don't just take things for a month and then quit, you know? There's a bunch of ways that you can really control for this, and a lot of it comes down to how you're speaking to people and how you're communicating through your emails and through your follow-up. And the better that you are at the patient education part of this, the better compliance you're going to have. And if you have better compliance, people are going to get better. They do their lifestyle changes, they take their supplements, they're going to feel better, and then that's going to be what drives referrals. So in a sense, it really is patient education that drives the economic engine here. You're teaching them about lifestyle changes so that they do them. You're teaching about the supplements so that they take them. They're getting better because they're taking all these supplements, they're doing all these labs, they're doing the retesting. Now they're better, and you're asking them for referrals, which is basically free marketing.

I have this one patient, Sally. And when I first met Sally, and I counted in those days, I don't count anymore, but I probably should. But anyways, when I first met Sally, she got a lot better. It was just sort of a dramatic healing experience for her. But whatever, it wasn't because I'm so good, it was just sort of happened. And she got a lot better, really fast. And she referred me 29 patients that year. I'm not kidding. That was my highest. I ever got 29 patients from one person. One person. She's had a big mouth, and she told everybody about me, and she made all her kids see me too. So it was like five right there. Like she had four kids and her husband, so they all had to see me, plus all her friends and other family members and stuff. Um, so you should, on average, though, be getting one referral from every new patient. So every new patient that comes in should, on average, refer you one new patient. That's the minimum metric you should have. So, okay, you get someone like Sally who refers you 20 people, that means you could have 20 people who refer you no one, okay? So not everybody has to send you 20 people, but on average, every new patient should refer you one new patient. So if you have 100 new patients this year, you should on average get 100 patient referrals from that group. And there's your marketing right there, okay? If you're not doing that, then you're, you kind of subpar, and you got to figure out why that's not happening and then, and fix it, right?

And then the other thing that you want to think about is that, um, you should also do some marketing. So you're bringing in new people that are not referrals. And in my practice, for most of the years I've done this, I don't know, it's probably like almost like a one to one. So like about half of the new patients are coming in from a personal referral, and half are coming in because they just learned about us somehow, you know, through some educational effort that I was doing. And almost all of our patient referrals that are, you know, coming not from an old patient, but just from the internet, are coming from the lectures that I've done and posted online. People see me do a lecture or hear a lecture, and they want to come in, okay? And that doesn't cost us anything either. I just do the talk, we post it online, and people come in. So I pay for the last 20, well, yeah, can I honestly say this? Yeah, I think I can. For the last 30 years, I've paid zero dollars in marketing, but I've done a ton of educational effort on my own part as the marketing itself, yeah, okay.

Communication skills development. Some people are really good at this naturally, some people are not. I had to learn how to do this, and I learned because my first mentor, Dr. Glenn Freider, watched me work with my first new patient because I was watching him for a few years. And I was, and he, and he the next evening, he took me out and he said, "Dan, you need to go to a patient, you need to go to a communication workshop." And I was like, "Really?" And he's like, "Yeah, you do." And I was a little embarrassed, I guess. I was embarrassed. He's like, "Ah, just go. Here's the name." And I went to all these communication workshops, and I learned how to communicate. So it was a skill that I had to be trained in. Um, you can learn it, though. I've gotten really, really good at it because I went to all these communication workshops for a year or two. And that again, is the main driver of sales, the main driver of referrals, the main driver of your income. Now, some of you are already good at communication, so if you're good at it, you don't have to worry about it, okay? Certainly, uh, and we'll have time for questions at the end today. Yep. All right.

So patient communication. First step, and there's three different versions of this, right? Developing rapport, explaining the patient complaints using conditions description technique, and then explaining your ability to test and correct their problems. Usually, the first five minutes or so is spent, yeah, maybe six, not not much longer than that. It's just having the person talk. I'm saying, "Hey, why'd you come in today, Susie? Why'd you come in today, John? What's going on?" And, you know, not talking about the weather, but talking about health and what's going on. I try to keep the chit-chat to zero. So if someone says, "Oh, how are you doing, Dr. Kalish?" I'll just, you know, be like, "Fine, and let's look at their labs." Yeah, no, no inner, you know, no normal conversation like you would have if you just met somebody, you know, at a party or something. None of that kind of stuff. So the rapport development is all about clinical stuff. So you're asking them questions, they're answering. And then explaining patient complaints. Let's say they let you know, "I am tired, I am overweight, and, uh, my hormones are horrible." And you've got that message in the first five or six minutes. And then you start talking about how the lab testing relates to their specific individual problems. That's the key to communication. So when, then I would say, "Okay, so let's talk about doing an adrenal panel. And, you know, I understand you're tired, you're overweight, and your female hormones aren't doing well. You've got hot flashes, light sweats. Well, it turns out that if we can test and correct your adrenals, that may help you with these problems. Why? Well, adrenal hormones are in control of your metabolism. So if your adrenal hormones are not doing well, you'll have what we call a damaged metabolism, which causes you to put on body fat and not burn fat very effectively, even if you're eating a lot less than you should, even if you're exercising a lot. If your metabolism is damaged, you're still going to have trouble losing weight. And then, you know, the adrenal glands when they're exhausted, people feel exhausted. And cortisol and DHEA have a strong connection with female hormones. We find that at least 50% of female hormone problems start to clear up when we do an adrenal protocol." So you're explaining the adrenal lab, but specifically to address their main complaints. That's the real skill set that you want to develop. And if you learn the scripting and you make up your own scripts for how to do this, you'll find 95% of patients will order the labs. That's the conversion rate that we see with our students who learn how to do this properly, okay?

Now, the fourth pillar, operations, the logistics. I'm going to skip this because I don't know, I'm kidding. I, this is my least favorite thing. You just like have to force myself to deal with this, but I'm for, I have a slide on it. I'm dealing with it. For some of you, you may love logistics and operations. Some of you may be more like me, who would just like tuning out right now. If you're texting somebody right now, then you know you're in that category of people that don't like this stuff. Um, but it's really important. So you want to think about just simple stuff that everybody needs. Which one of the most simple things that everybody has to have is the patient process flow, and that determines where the patient is in the different stages of the life cycle of what you're trying to do, okay? And I'll show you a slide on that in a second. And you want to have a system then in place so that if people drop out at a certain point in this process, you can see where that is and then start to fix it so that you can keep people engaged. And again, the problem here that we're trying to solve for is retention. So here's a typical patient process flow: new patient inquiry, that means the email or call or drop by your office in some way. New patient consult happens. They buy labs. They review the labs a month later. They buy their supplement program. You do a follow-up consult. They reorder their supplements. You do another follow-up consult. Six months into this, you retest the labs, and then eventually they're better, and you put them on a maintenance or ongoing program. So that would be the process in my clinic. So we just have a simple list that we maintain. People that have inquired but didn't sign up as a new patient, just put it on a spreadsheet. I mean, you could get a fancy program to do this, we just put it on an Excel spreadsheet, it's pretty basic. So we have a list of people at the end of the month who inquired but didn't become new patients. So guess what? We email them, call them, or text them and say, "Hey, you know, you were interested in our practice but didn't come in for a consult. Is there anything we can do to help? You know, answer any questions you have?" Same thing if the person comes in for a new patient consult, but they don't buy their labs. We have a list. New patients who came in but didn't buy their labs. At the end of the month, they get calls and emails and follow-up and texts and everything. "Hey, we noticed that you didn't order your labs yet. Are there any questions that we have that we could answer for you?" So each one of these stages, whatever it is in your practice, needs to have sort of a catch basin so if the person is dropping out there, you're catching them and you have a mechanism for getting them. One of my favorite ones is, and this used to happen a lot, is they've bought the lab test kits from us because we sell the kits to them. We don't have them pay the lab, we have them pay us, and then we pay them. So they bought the lab kit from us, but they didn't do it yet. That used to be, I don't know, I remember the first time when this happened, it was, oh, it must have been 15 or 20 years ago, and John, my old business manager, was looking at this, you know, our bookkeeping. He was like, "What's this $35,000 right here?" I'm like, "I don't know." Because I didn't know. And I looked at it, I was like, "Oh, that looks like people who bought labs, but we're just holding it on a balance sheet there because they never did the lab." And then he was like, "Wow, that really happens." And it's like, "Yeah, I guess it does. I didn't really ever notice that. I never tracked that before." And then John was excited because like, "Well, that's the easiest money you're ever gonna make because they bought it, but you didn't have to give them anything." And then I thought, "No, that's the worst thing that could happen because those are people that are not going to be coming back." So for me, it was this list of failures, and for John, it was like instant money. Okay, so from a business perspective, you do not want people buying labs and not doing them because you want them coming back. You want to put them through this whole process. So the whole point of this is to get them better. And obviously, those are people that have dropped out of the practice. And we then since then have made a point of after people buying the labs, if they haven't sent the lab in in a week or two, we reach out and find out why. And it's always some stupid problem like, "It's the adrenal test and I, I can't drink coffee that day and I don't know what to do." Or it's a stool test, it's really gross, I'm not sure what to do. Or I just moved, I lost the test kit. Okay, we'll send you another one. So that kind of follow-up is perceived by patients as you just being, you know, nice. It's not.

going to be seen as like you pushing your business on them. You're just helping them get through this process, okay? And the better that you can follow up in this way, the better that your sales are going to be, and the better results you're going to get.

This other phrase to use in Silicon Valley called "sell to your install base," which is the idea that your best customers are your current patients. And if you educate them properly, they're going to want to get more stuff from you, you know? And for me, it's really easy because I'll go to a conference or take a class somewhere, it'll get really excited. I don't know about nitric oxide or really excited about, um, long-haul COVID or some subject matter. And then I'll just let my patients know about it, and they just come back and want these other services from me. So a lot of it is just staying vital and involved in your own field, right? To make these referrals happen.

Um, the fifth pillar, support network. Making sure that you have professionals that you pay: a CPA, a bookkeeper, an attorney, a financial advisor, pension and retirement planners, business coach, business advisors. In a constantly area, I don't know if you ever saw the Godfather movie, but you know that's that that lawyer person that's sort of, you know, the advice or the secret advisor kind of person. And then you want unpaid professional contacts like your business friends for meetings and brainstorming and financial planning and clinical support practices that you can relate to, people that you can talk shop with and just go out for a cup of coffee with or take a hike with and vent with, you know? It's really important to have those business friends as well.

And then of course, on your own side, as a support network, you need to have someone to help you with your exercise, keep you healthy, your meditation. Farmer John, we have our farmer that we buy all our vegetables from that we know. You just gotta have this whole group of people around you to help keep you healthy.

So again, the three P's, right? The practitioner, the patients, the practice, all working together. And eventually, we find this comes together and that everybody feels complete if they do these steps. And if you're not doing these steps, then you're going to think that you need more marketing and that you need more advertising because you're not doing all this stuff, okay? If you're doing this stuff well, you're not going to need, you're not going to think about the marketing and advertising part because you're going to have plenty of new people staying with you, coming in and staying with you.

So the marketing that you can do, but not paid marketing, is just having a clear message and a clear model to make sure that everyone understands what the heck you're trying to do here, okay? So let me show you. Here's a couple of the tips talked about the margins, making sure you get the right staff, IT systems, coaches, and whatnot. But I want to show you a couple of things here now as we wrap up. And let me see here. Before we get there, I just want to mention for those of you that joined us late, we have a boot camp coming up in September on this subject about how to build a successful functional medicine practice. It's one month long. If you're a Genova customer, you get 20% off with the early bird discount with this code GD23 for Genova Diagnostics 23. You can take a snapshot of that QR code there. We'll send you out an email in the next day or so with the registration link. But if you're interested in building your practice, this is a very affordable class. It's four weeks of just focusing on a business every day and getting yourself to that next level, okay?

Now, I just want to show you one last thing before we go to questions. And I want to show you like a model, okay? So here's one model. I like this one. A lot of students like it. You can use this if you want, or you know, modify it if you want. But, um, it's a model of, uh, what are we really doing here? Well, I don't know who's, uh, let's say a patient comes in. Her name is Jennifer. So I would say, "Hey Jennifer, what we're concerned with is that there are these four horsemen or these four problems that plague humanity and create a lot of health issues. And they are inflammation, catabolic physiology, insulin resistance, and oxidative stress. And most chronic illness, most, uh, chronic health problems can be tracked back to one or more of these particular problems. And so in my practice, we are going to test for and correct hidden sources of inflammation. We're going to reverse catabolic physiology, reverse, test for, and if it's present, reverse insulin resistance and reduce oxidative stress. And that puts you at lower risk for cancer, heart disease, diabetes. If we do this properly, you could lose weight, you'll have more energy, your joint pain and body pain will go away, your fatigue will go away. These are the basic categories that we need to address. And we can talk about inflammation coming from the gut or from your liver. Catabolic physiology means the HPA axis is dysfunctional. In other words, you're really stressed, so you're breaking your tissues down all the time. Insulin resistance has a lot to do with what you eat and how you eat and when you eat and how you exercise and how good your muscle tone is, your muscle mass. And then oxidative stress. So the plague of humanity these days, isn't it? Environmental toxins, exposure, all the things that happen from that, basically oxidative stress damages your cells and kills them. So we want to test for and correct all of these different things. How do we do that? Well, we test for gut inflammation and liver inflammation, looking at environmental toxins and the microbiome. We look at catabolic physiology by measuring the adrenal hormones and your stress hormones like adrenaline or epinephrine. Insulin resistance, we do an organic acids test to look at and also talk to you about your diet. And for oxidative stress, we also do the same kind of testing, right? And so all these things put together, super, super impactful for people as a model.

Now, another potential model here, three body systems. I kind of like this one too. I use this one more. Is that there's three body systems: stress hormones, GI, and detox. And many of you may have heard this before, if you've done any of my other lectures before, but I like this model. It kind of encompasses why people get sick and then what we are going to correct. So this one's kind of handy in that way. So, and you can make up anything you want for the different systems. It could be five systems or ten systems or two systems. It doesn't really matter. In the years we used to work with Timmins, it was four. It was stress, gut, detox, and immune. He had four, and I worked with that model for many years. I cut it back to three. I don't know why, but just seemed easier to do three. And stress hormones could be, you could ever change the order. It could be a thyroid problems, or you could put, uh, mitochondrial problems as the first body system. It doesn't really matter as long as you have a clear system that describes why you think people get sick. This is how I show that people break down. Stress causes stress hormone problems, then eventually gut problems and detox issues. And then how we're going to address those problems, okay? Pretty simple, dimple.

Now, for you all, then take-home messages are: start to think about a clinical model. You can copy one of these or take one of these and modify it or make up your own and practice it so that you're able to explain it in a minute or two and maybe spend five minutes for some people to explain how you think people get sick and how they're going to get better. And roll that out as your patient education. Start to think about a niche and how what patients you want to focus on, and perhaps more importantly, what patients you want to avoid. And then think about your business operations and all the logistical stuff that we're talking about here, patient processes and compliance issues and keeping people in your practice. And I think if you start to spend, I don't know, at least a day a week on your business, you should make a really big impact in terms of your stress being reduced, your income being increased, and you having the free time you need to take care of yourself, okay?

So I'm going to wrap it up for now, and then I'm going to open it up for questions. So I know some of you may need to run, but let's look at the questions that came in, okay? So let's see from Anne, "What and where are some specific sources for research, especially on odd symptoms and biomarkers?" Well, that's complicated. I mean, I've done a lot of class work. I think I've been to the IFM modules, every module, at least three or four times. A4M, you know, those are the main educational groups that really help us understand this. And then now I have one-on-one sessions with Dr. Lord every week, so, well, twice, once or twice a week. So I'm pretty fortunate and I can just go right to the original researcher himself and talk to him. But I'd say just involving yourself in different, you know, courses. And the classes that I teach are not so academically oriented. They're much more practical, uh, in terms of like lab interpretation skills development, more so than teaching about the basic science.

Let's see. Let's see. Dan was just chiming in on his overhead. And his overhead is 65 to 70%. So for Dan, that's about the best that you can do, right? His overhead, I'm sorry, his, um, his margins are 65 to 70%. So his overhead is, let's say, around 30% of what he brings in. That's a really good one. Uh, oh, there's someone else here who has actually, uh, no, that's a margin of 20%. That's not very good. Let's see. Um, from Anne, see Kim is asking, oh, she's just getting started in her practice. Let's see. Emin asking about website design. So a good website should cost you guys, I don't know, maybe three, four, five thousand dollars. And it should be personalized. I mean, the best thing to do is just to search online for functional medicine doctors and look at 15 or 20 websites and pick out the components of each one that you like. Take a little snapshot of it with your phone and then take that to your web designer and say, "Hey, build this. You know, I want this person's about page, I want this person's homepage, and what this person's that, you know?" And make sure that it's commerce-oriented and that it's very clear what the action steps should be. So you don't, every page of your website needs to have an action step which leads the person to get more information or leads the person to purchase something or both, okay? I don't have any great companies to recommend for website design, unfortunately.

So in terms of cash versus insurance, I think at this point in human history for our field, almost everybody that I know that's really happy is all cash-based. So I would strongly suggest in the beginning, at least, that you start off with a cash-based practice or a membership practice, but not an insurance-based practice for the time being, for this current moment in time. I think, um, so if patients fill out a questionnaire, that's usually done prior to them coming in, and there's no charges for that typically.

So in terms of marking up lab tests, I've never marked up lab tests. So they know practitioners who do. You have to make sure you check with your attorney and that it's legal in your state to do that. What I do is I charge a lab interpretation fee per test for my time to interpret the test. So if they spend $150 on an adrenal lab, there's a $50 lab interpretation fee, which is for my hours of time outside of the patient consultation, one-to-one time, for interpreting the lab and setting up the program. And we have a similar fee for each one of the tests. The fee is about 30% of the cost of the lab. So if they do a neutral valve test, they spend three or four hundred dollars on a test, there's a hundred dollar lab interpretation fee, which is for my hourly rate for interpreting the lab, but not, it's not a patient contact time, right? This time when I'm just at home in my office looking at the labs.

Can you build a successful practice without social media? Absolutely. Yeah, you don't need to do that at all. But you need to just do education. But it doesn't have to be social media. If you don't like social media, I wouldn't do it.

See, oh, so in terms of EHR systems, um, that is a very, very good question. There's a couple of them out there. There's Power2Practice, which people like a lot. There's some low-cost ones like Jane. A lot of my students use Jane. It's another one. Um, depends on how much you want to spend, really, and how many bells and whistles you need, you know? Some people do really well with these inexpensive or free ones. Other people want ones that are going to be, you know, quite a bit more complex.

So the, the goal of the margin is based on total revenue. That is correct. So your total revenue is a million dollars, half a million dollars is expense, that means you're at a 50% margin.

Does the boot camp talk about the tech side? Yeah, we talk about it, but it's not like I'm going to build you a website kind of thing. But definitely comes up because the more, the best way you can lower your overhead is by increasing your use of technology, right?

For the margin, do you include your own salary? Oh, that's a Shark Tank question. If you've ever watched Shark Tank, that's a Shark Tank question. Oh, that's a hard answer. Um, the answer should be yes, but it's usually no. So Julie, most of the time, people do not include their salary in the over, in the overhead. But you should. If you're on Shark Tank, you would answer that as a yes, but most doctors do not do it that way.

Let's see. For an RN that's getting started in this, well, where do I get more training on lab interpretation? Yeah, that's me. So anyway, that's my main niche is lab interpretation training. Um, so I do feel like we're pretty confident in helping you with that, Shannon. And then, um, you don't necessarily have to team with an MD. There's plenty of RNs and NPs that work on their own, you know, and there's ways you can do that. You need to talk to an attorney about it, but, um, it's doable. I certainly could help you set that up because we have a lot of RNs that have done that. Um, you just don't want to be practicing medicine without a license. But you know, you can, you can do functional medicine without having to have a medical license for sure if you structure it properly.

Best patient education platform? Everything is video these days. Yeah, everything's on video.

How do we store medical records? Yeah, so we have a cloud-based system that's all kind of password protected and all that good stuff.

All right, and again, as we wrap up our hour here, if you guys are interested in more business training, we have this very reasonably priced "How to Build a Functional Medicine Practice" course that we're doing in partnership with Genova. You get 20% off that, the early bird discount, if you sign up before the first of August. There's a QR code you can snap a picture of there. And it's only four weeks of your life. There's not a lot of suffering involved, but it's like an intense four weeks because you gotta allocate some time each day to doing this, you know, maybe two or three hours a week, maybe more if you can, okay? And if you guys have other questions, please reach out to us. And I hope to hear you more, uh, to see you again, you know, in some other class that we teach, okay? All right, take care, everyone. Bye for now.