Welcome to Bridge the Gap odcast, senior living podcast with Josh and Lucas. A very exciting episode from a long time industry guy. We want to welcome Pat Mulloy. Welcome to the show.
Thank you, Lucas. Good to be here with you and Josh. Thank you.
Absolutely. It’s great to see you. Many people in the industry are very familiar with you being the CEO not only at, I believe Atria, but also Elmcroft, which is probably the most recent thing that people remember about your leadership in our industry. But you’re not totally out of the industry. Can you tell us, just bring us up to date with what, what do you have going on these days?
We had a transaction with Elmcroft in early 2018 and since then, I serve on, my volunteer day job is that I’m board chair at Argentum. Tim Buchanan finished up his term. And it’s a little bit unusual to not have an operating CEO as the board chair, but they asked me to serve. I’ve been on that board for a long time, was actually was on the as executive committee years ago as well, and we can touch on those issues if you want later. But I spent a lot of time. And then with COVID it really accelerated the amount of work, and I really couldn’t be prouder of James Balda and the team at Argentum focused on provider relief funds, focused on, we put together a team of lawyers focused on trying to get legislation and executive orders to protect senior housing operators around the country.
The business as you know, well know, you’re taking care of the frailest of the frail, you’re taking care of folks in their eighties who are in the last chapters of their life. They come to us with typically a host of comorbidities and other issues just because they’ve lived long years. And so you’ve got a workforce that, that brought COVID into the buildings, a fragile group of folks living with us, and it sort of made for a perfect storm in many ways, but I couldn’t be prouder. I think the nursing home industry honestly got unfairly slammed in many ways by the press and regulators and the politicians. And that’s a longer conversation. The data that I’m aware of, that we help put together with NIC and an organization called NORC out of Chicago, is that the senior housing industry, the private pay side did rather well.
I mean, they were aggressive in terms of helping to manage the workforce and to talking about vaccines and introducing that to the workforce and making sure it got implemented with the folks living in the buildings. And so Argentum was a huge voice in all of that liability protection, provider relief, the solutions we got weren’t perfect. The private pay side of senior, your housing, if you sort of measure it with a yardstick, probably got short changed by the politicians in terms of the amount of funding. But we started from ground zero and ended getting ended up getting billions of dollars of relief for the industry. It wasn’t me, it was me and a lot of volunteers and leadership at Argentum, really good leadership at Asha, David Schless and his team over there. First rate government relations people.
Pay Mulloy 04:09
And again, this is part of a larger conversation, but one of the real lessons that came out of COVID for those organizations, we’ve always, I would say dabbled in and stuck our toes in advocacy because this is an industry that’s largely regulated at the state level. We weren’t as sophisticated in terms of advocacy at the federal level as the industry needed to be. We’ve sort of gone from junior kindergarten, if you will, and we’re now in about third or fourth grade of that journey. But we’ve got to get to high school and college and postgraduate at level to use that analogy in terms of advocacy, both at the federal and at the state level. And I think COVID has accelerated that. But to answer your question, that’s my volunteer day work. And then I’m on the board of a human resource private equity backed company.
Pat Mulloy 04:58
That’s an HR solution for post acute care of, addressing the workforce shortages. I’m on the board of a company, interestingly enough, called Assembly in Chicago that’s backed by a terrific private equity firm called Shore Capital, really smart bunch of people. And that company is what its name implies. It’s about assembling the outside healthcare services, both real life services, like pediatry, to technology and revenue cycle management services for the post-acute care space so that they can operate more efficiently and do the work that they need to do. And then interestingly enough, I’m on the board of a publicly traded company that is the second largest, it’s a bit of an ESG play. We’re the second largest manager of medical waste in the country. And we take care of it in everything from dermatology clinics to veterinary clinics, to hundreds and hundreds of assisted living and skilled nursing care.
Pat Mulloy 05:58
And if you think about the disposition of COVID needles during this pandemic, the name of the company is Sharps from the term of sharp objects and needles, and so we manage that soup and nuts for healthcare providers across the country. And we have a product there called Medsafe. It’s the best product that I’ve seen. If you walk into a CVS across the country, many of them you’ll see a mailbox looking box and it’s a place where controlled substances can be disposed of and not reaccessed. And we dispose of it in an environmentally sustainable, appropriate, compliant way. And we do that for providers like CVS and for healthcare providers all over the country, assisted living communities. Think about in all the years I operated senior housing, It’s not a huge issue, but it’s the issue of diversion of narcotics, it’s a real issue.
Pay Mulloy 06:51
And anybody that’s awake is aware of the opioid issues in this country over the last decade, when grandmother passes away and leaves those medications behind, how do you comply with the law? You can’t put the down the commode like they did 10 years ago, that’s illegal under environmental laws. So we found solutions for that. So yeah, I’m still way involved in the industry and I love it. It’s sort of been my life for the last 20 year, I stumbled into it in 1996 or whatever that math is about 25 years.
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I’ve been in the industry a while. It’s been fun following you know at least part of your journey while I’ve been in the industry. And I know a lot of our listeners follow you as well, and maybe weren’t even aware of all the different boards that you serve on. So that was a good summary. One of the things when we were pinging you about being on the show, Lucas had seen a Ted talk about kindness and different things like that you had done, so the topic of kindness you know, in this world that we live in, where it can be so polarizing. And we think everybody needs a little bit more kindness, want to dive into that. We may even tag that in our show notes to our nurse after this launches, but can you kind of take us through some of your talking points there and kind of your perception and how that applies to our industry?
Pay Mulloy 08:51
Sure. It’s a I won’t get too personal, but a lot, a lot of this is just reflections. My own personal reflections over issues I’ve confronted in my own life and issues I’ve confronted in business. There’s a Ted Talk that I would highly commend to everybody. A fellow’s name is James Rhee, and his story, I wont try to tell his story. You can Google it on Ted Talk, but it’s worth 14, 15 minutes of your life and your time. And it resonated with me. James had him as a speaker at Argentum. I think let’s see, what are we in? We’re in January, I guess. He spoke at the Argentum conference in Phoenix last year. And then they had him back at our CEO Summit down in Florida a few weeks ago. And his story’s an amazing story.
Pat Mulloy 09:43
He’s a private equity guy by training, smart as a whip, had all the sort of obvious apparent tools you have to have to be a successful business person. I mean, a keen analytical mind, mathematics skills, economic skills, IT skills and his life changed though, because he got on the board and this company had invested in a company called Ashley Stewart, a company, I was vaguely familiar with that that didn’t know much about. And it was a company that was slowly circling the drain financially. I think he was on the private equity side of it, set on the board and it was just going down the proverbial financial commode. It was failing. And and I’m not judging. I’ve been in partners with both big REITS and private equity people, most of my adult career. And I always describe them as people say, are they good?
Pat Mulloy 10:41
Are they bad? They’re like marriages. They’re very personal. You have to, you have to make sure that you have a relationship with the people that are there and that they understand what your goals are and you understand what their goals are so you can’t paint them with a broad brush. But I think the story that James tells is that this group of leaders were watching this company fail and they were about to shut it down. They were gonna put it in bankruptcy. And James somehow was touched by the fundamental mission of the company, and I didn’t know much about Ashley Stewart, but Ashley Stewart is a lower to middle market provider of clothing for plus sized women,and largely African American customers. So it filled a huge marketing niche for these individuals. And so you had this dynamic going on of a failing business, and a bunch of really smart financial people watching the business fail, but nobody kind of getting inside of the business and understand what was really going on.
Pay Mulloy 11:44
And he tells the story of how he decided to step off the board, take over the company, didn’t have a clue, what fashion retailing was about, but he had this keen sense of empathy and kindness, if you will, that I think he was raised with in his family. He tells a lot of the story and the Ted talk about his family of origin. And it’s a little bit, the analogy to me was, and what spoke, I think, to the hundreds of senior housing operators that were in the room at our Argentum conference when he spoke, is that, and I used to say this a lot when I was CEO of whether it was Atria or Life Trust or Elmcroft that you think in this business, that your customer is the obvious customer, that it’s the 82 year old grandmother.
Pat Mulloy 12:34
And it’s really not. She’s not really your primary stakeholder. She’s the obvious stakeholder, she and her children are writing checks every month for your services. But the real stakeholders are, these workforces are typically 88% female, lots of single moms, and lots of GED and high school graduates doing all the work that Lucas and Josh and Pat won’t do for a living every day. And that sounds funny, but it mean for me, what always resonated with me is they they’re doing stuff, they’re checking on grandmother’s dentures and they’re putting her up and down off the commode, and they’re bathing her, and they are showing kindness to her when she’s lost her husband. And she’s afraid, and she’s in Atlanta, an assisted living community, and her kids are in Scottsdale and she doesn’t get to see anybody. And all that just got accelerated during COVID with thousands and thousands of stories of isolation, loneliness.
Pat Mulloy 13:32
So your most important person in the business is that caregiver. It’s that person at the front line. And what James figured out with Ashley Stewart was the same thing. It was the local managers and women working in this business, giving women that may never get to go spend $5,000 at a Neiman Marcus, or a Sax, or have that’s sort of financial experience, but wanted a fashion experience that spoke to where they were in the marketplace. And so he was touched by that group of people and he built a culture with all the financial stuff you have to do. You’ve got to do all that to understand what your business is. But with that kindness added ingredient, he built a company with real staying power. His talk spoke to me because it’s after 25 years of lots of successes, but also lots of mistakes and screw ups on my part and other people on my team’s part, the inescapable eye of the needle in our business is that this is a service business.
Pat Mulloy 14:44
And it is a it’s a business where you’re asking now a $15 an hour worker in many markets, cause we’ve had a lot of wage inflation and some of which is long overdoing, some of which will put all kinds of other pressures on these businesses. But they’re doing incredibly difficult work. And as I said with COVID, all the stuff about heroes and all that stuff is, is sounds superficial, but it’s so true because these people were taking care of grandmothers that for 18 months in many jurisdictions couldn’t see their children, because you couldn’t get into the buildings. I’ve known operators that, I’m not judging people, but I’ve known a lot of people in this business that just don’t get that of the business. But you can’t get there with all the financial tools and all the data tools and all the information technology tools.
Pat Mulloy 15:40
If you don’t have leadership that gets the human side of this business, you won’t succeed. I was thinking about chatting with you all this morning early, and one of the things I’m proudest of that at Atria, at Elmcroft and my partner, Tim Wesley and I, we weren’t perfect, but we built cultures where people would want to stay, because you treated them with kindness, because you treated them with integrity. you told them with as much transparency as you can bring to business, what the issues are. And when you do that, you’ll get the benefit of the doubt from your employees. And you’ll get the benefit of the doubt from your residents when you screw up and make a mistake, because you will. And so not only treating people with dignity and respect and little things, remembering their name, go long to their communities, talking to them, dropping them thank you notes, calling families when you make mistakes and apologizing for what you did. I’ve done that 30 times in my career and probably saved hundreds of thousands of dollars in malpractice settlements. Not because they magically went oh way, but because they understood you were a human organization trying to do the best you could in very difficult circumstances. I don’t know if that resonates with your listeners. It’s just stuff that is built up in me after 25 years of as I said, some degree of success and lots of degrees of failure from day to day.
Well, thank you for sharing that story. I mean, so that’s a really good insight to some of the things going on at some of our leading events in the industry. Lucas, one of the reasons why we even started this platform originally was to be able to take the thought leadership that folks like us that are talking here with Pat, we get to experience, we’re blessed and fortunate that we get to learn from and hear these reminders and this great content. But many of our listeners a large percentage that are in the communities on a daily basis, don’t have the time. They don’t have the resources. They don’t have the money to go to these great events, to hear these great speakers, to be motivated and reminded of these great moments because they are head down, they’re front of the line.
And I think in this world, that’s so polarized that we live. It’s such a great reminder to us, this story, to not forget why we’re here, why we’re working, whether we’re in the C-suites, in the ivory towers, or whether we’re in the community, kindness goes a long, long way. While you were talking Pat, I looked up, I always like to do this and just actually look up definitions of what words mean, because I think it’s real easy, you get caught up in in things and you forget, “wow, kindness actually has something defined,” and it says, “the quality or state of being gentle and considerate.” When I think about that in my own life, it’s really easy for us to be gentle and considerate when things are going well. Right? But it’s when something rubs you the wrong way, when somebody doesn’t see things eye to eye, the way you see them, when a turbulent situation, that’s when it really becomes, it’s a choice, right? We have to choose to be kind and to show deference, to show gentleness and consider it. So Pat, thank you for taking time today to share that with us. Lucas you’re in and outta communities every single day, all over the state of Texas. And I know you get to witness this.
Yeah. You know, it’s such a great point. Workplace culture and the labor issues that our industry is facing right now, I think is probably the number one issue on the table of challenges that senior living operators and providers are going to have right now. And developing this state and culture of kindness, it’s something that is often but right now is needed more than ever. Pat you are involved in this area of the labor force. How do you think that this applies?
Pat Mulloy 20:03
I mean, it’s a perfect storm right now. You open the Wall Street Journal every day and you’ll read a new article about the great resignation, and great resignation is a sort of a catch term for burnout, exhaustion and people looking for other options. The interesting thing about our workforce is that most of them, most of the women in men that are drawn to this industry there is, and I’m not pollyannaish about this. I also believe in accountability and running strong training and accountability functions in organizations. But they’re there for a reason. If it’s a default job that somebody’s come into this business just to make $13 an hour or $17 an hour or whatever market they’re in, and they don’t really have a clue what they’re doing, and I don’t mean clue about their job, but they don’t really have a clue about what the core business is or care about it.
They won’t last. They always will end up failing at the business. We’ve got this perfect storm right now where a bunch of people have walked off the job from burnout. I’m also on the University of Louisville Hospital board, you’ve got this massive shortage of nurses, there are all kinds of structural problems in the country. In my own state of Kentucky until recently, we actually had a cap on the number of new nurses, the statewide license each year, which is these old archaic rules. So you’ve got a shortage of people, you’ve got burnout. And you’ve got to figure out how, we’ve gotta figure out as an industry, how to open a whole new generation of people coming in and serving in this industry. And it’s not as easy as just saying, “well, I’m going up the street to the Ramada Inn, or to the Residence Inn, or to the Hampton Inn, and I’m gonna recruit people out of hospitality.”
Pat Mulloy 22:04
I mean, over the years, and sometimes it works and sometimes you will find people, but it’s more complicated and more subtle to that. Other than that, I think technology can be an answer to the company deploying on which board I said, the whole art of what they’ve built is speed to hire. And it is the ability on your cell phone to file your application, get your criminal background check done and reduce what is typically a 45 to 65 day process for hiring would post all the advertisements for the new jobs to try to get it down to 25, 28 days. That helps, but to still the underlying problem. And this is a policy issue that’s bigger and more complicated is that we’ve just got a shortage of folks that will do this frontline work in this country.
Pat Mulloy 22:58
And that means immigration reform. And that’s a complicated, longer conversation, but we’ve got to open the doors to letting tens of thousands of new people become Americans that want to come here and have an opportunity at the American dream. And we’ve to your point, Josh earlier, you know, the division that has gripped this country for most of the last decade continues to freeze that conversation. And I don’t have the answer for what catalyst will end that, and I remain hopeful. I’m generally a glass half full guy, but that’s gotta be part of the solution. We don’t have enough people in the country to do the work.
Well, Pat, there’s so much to talk about here. You know, unfortunately we’ve got to wrap this show, but I appreciate, I know Lucas appreciates, our listeners appreciate you sitting down, taking time from all the various hats that you wear and spending some time with us today. We will definitely be connecting our listeners to you if they’re not already following you so they can follow your journey, your leadership Lucas, great conversation today.
Yeah. And we’ll also make sure that we connect in the show notes to the Ted talk that you mentioned so that people can add access that. Kindness, it goes a long way. And especially when you are confronted with something you don’t like, you gotta be kind, let’s all practice some kindness today.
Pat Mulloy 24:37
I enjoyed it. Thank you’all take care.
And thanks to everyone for listening to another great episode of Bridge the Gap.