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Ep. 138: Bobby Guy

Bobby Guy is an author, speaker, podcast host and healthcare transactions attorney. He is passionate about healthcare based on 25 years experience practicing as a healthcare attorney and provides an update on the current M&A opportunity in senior living. He hails from Nashville, Tennessee, where he co-founded the local office of national law firm Polsinelli.

House of Blues at NIC Fall Conference 2019 recap video

10 Minute HealthBizCast podcast, hosted by Bobby Guy

Lucas: Welcome to the Bridge the Gap podcast, the senior living podcast with Josh and Lucas. A great show on deck today. One of our good friends out of Nashville, Tennessee. We are welcoming Bobby Guy to the program. Welcome. 


Bobby: Hey guys, how’s it going? 


Lucas: Good. Good to see you. So Bobby, this is kind of a round two on your podcast episode, because we didn’t realize in January what 2020 was going to be like, none of us had any clue what that was going to happen. So we met up at ASHA at the beginning of the year. We had a great podcast episode, but as we kind of had it in our queue in our backlog, we had a pandemic. So we decided to put that one on the shelf for the time being, and then come back to it. And so with you being a partner at Polsinelli, I think that this is going to be a very relevant show conversation, but before we dive into the legalities of what is bubbling up in your firm, let’s talk about some of the fun things that took place at the end of last year.


As people can see if you’re watching the video, and if you follow Bobby on social media, you will know that Bobby is an epic electric guitar player. 


Bobby: Thank you, thank you. That’s very nice.


Lucas: And I was very fortunate to share the stage with Bobby and Eric Mendelson at the House of Blues party, that Blueprint and many others help support and put on at the fall NIC conference last year. And we had a blast. 


Bobby: It was a great time. Anytime you can play guitar and have the band up at the house of blues in Chicago, that’s a great night. 

Lucas: It was a good day.


Bobby: You can do it with like 3000 of your best friends from the neck. It’s really a great night. 


Lucas: It was a great night and it was a great night, especially when I finished, because I was literally dry heaving before because I was so nervous. 


Bobby: So that everybody knows none of us could tell. And you broke out in the first line of the song and just nailed it. And the whole place erupted. On the video, as you look at it afterwards, there were people yelling go, Lucas, that’s pretty awesome.


Josh: It was incredible. I will verify that Lucas was about to hurl right before that though. He came backstage, which I was just his biggest fan and he was white as a ghost and sweating, like I am, I’m going to lose it right now. And he killed it, killed it. 


Lucas: Well, it helped that I would presume that there were some heavily intoxicated people there, so that helps a lot.


Bobby: They don’t drink at the NIC events, do they?


Lucas: Not at all. 


Josh: It was epic. Hard to think about: Does that not seem like a lifetime ago? I mean, like, I think about that wasn’t that long ago at this time last year, but what a different world we’re in, right. I mean, it’s crazy.


Bobby: I think of that as like, before the zombie apocalypse, right? And I can barely remember it. 


I tell you, I was at NIC the first week of March or the second week of March. And as we were there, that’s the week the NBA shut down. It was crazy, right? I mean, that was the last time I’ve really been on the road and seen everybody.


Lucas: Exactly. Well, I think the same thing for a lot of our listeners, t’s months and months ago. And we are in a very different time period right now. And you largely handle, you do a lot of mergers and acquisitions. You’re very specialized in the senior living, senior care market, health care space. And you’re also a very proud to host a great podcast that you just started this year called the 10 Minute Health Biz Cast. Talk to us about that. 


Bobby: Yeah. I’ll tell you that has been a lot of fun. I’ve reached that point in my career now where I’m getting to sort of talk about what I’m seeing and what I’m thinking and what I think it means for the future. And so the Health Biz Cast has been a lot of fun to put out. Basically it’s a 10 minute segment where we do interviews with different people doing innovation and healthcare, and the tagline is: exploring ways to make healthcare better. We’ve all got this theory that if you look at, if you focus on patient care and patient outcomes, and you try to improve those, then what will flow out of that are lots of ways to create successful healthcare businesses that will then also create an incredible public good as you make people healthier. And there’s so many inefficiencies in healthcare, it’s a great opportunity to sort of do it. So we’ve been able to interview rare disease foundations, senior living people, some behavioral people and talk through it. 


We’re probably episode 16 or so right now, season two. Or as we say in Nashville album two, right, and a lot of fun. And so the first album was on chronic care issues. The next album is on healthcare innovation. So we’re having a lot of fun doing that. And it’s just, it’s great to sort of be thinking about how to contribute to what healthcare is going to be, not in addition to trying to help it become a lot of that in the present, right. As we do mergers and acquisitions, as we grow technologically and we find new solutions.


Josh: Well, Bobby I’m sure your podcast is as you’re living through what we’re all living through. Lucas and I have talked a lot that over the last several months, it seems like regardless of what topic we have in senior living, the state of current affairs wiggles its way through that, because we’re all living through a pandemic and all the impact that’s had on senior housing and healthcare and technology. Has that been kind of a focal point of many of your discussions on your project?


Bobby: So a great question and yes, it has. I’ll tell you that we didn’t set out to cover COVID issues and a lot of the things that are coming out of this, because when we started we had the idea and set up a lot of the interviews before COVID hit, but COVID is consistently come up across the interviews. That’s been one of the interesting things with it. You can’t escape it. And so I’ll tell you that when we opened album two, I did a podcast that was sort of my thoughts on what the future looks like for healthcare and for senior living over the next call it the short term with the pandemic, and then the longer term. 


And I’ll tell you, the interesting thing is where we are now. We all thought we went into a couple months of lockdown and then we’d be out and we’d be somewhat back to normal. That has not worked out. I mean,  it’s 180 days of most people working from home now, right. But with that, what’s happened is we’re in a, what I refer to as sort of the great hiatus or the great pause. 


We’re in the COVID time, we’re after the way we used to live. And we’re not yet at a place where we can sort of return to normal or find the new normal. And there are four things that I think it’s going to take for us to move through this and get to the next stage. The first is you’ve got to have some sort of COVID containment, and that’s either going to be some type of treatment or call it quick testing, you know, rapid testing and some level of tracing. 


The second thing is you’ve gotta have the stimulus programs in the economy. We’re watching a recovery that has been a stronger recovery in it for a few months, and then now is dropping off significantly, right? And so it’s, you need more stimulus programs and it’s, we’re seeing it become apparent in the healthcare sector. And that’s really significant. 


Third thing is you’ve got to get through the election before we can figure out what all of this means, because there’s so much uncertainty. 


And the fourth is at some point we’ve got to get to a vaccine. 


And what I would say is that uncertainty is anathema to trying to run a business, especially a healthcare business. And and so here we are in the midst of it, those are the things that are creating so much uncertainty. And once we pass those one at a time, we’ll be able to sort of begin to see economic activity return. I think it’ll be a lot more possible for owners to plan strategically. Those are the big things. I think that we look at here coming up.


Josh: So Bobby, transition the conversation, because I think those are great points and outlooks. You obviously get to be a thought leader in your space and you have the platform that you’ve built out for your podcast and get to talk to a lot of thought leaders, but in your daily life of being a lawyer, being part of a law firm in the healthcare space and things like that, what are the hot button issues? Has that really changed a lot? When you talk about mergers and acquisitions, or is it lawsuits and litigation, is it  risk management? I mean, what, what are the hot button issues right now and how does that kind of differ or parallel from where we were just a few months ago?


Bobby: Great question. And,right on sort of where everything is right now with COVID, what I will say is that we’re doing a lot of the same things we were doing before. We’re just doing them two to three times as fast. Everything is much more urgent than it used to be. So for example, when it comes to cash flow and financing and then the PPP programs, and then the support we’ve seen from CMS, all of that is urgent. We’ve set up a basically a team internally that does nothing but handle those issues for dealing with all of it, including an M&A transactions and how it works, right? But primarily to help clients find the money to be able to bridge through the great pause. 


That’s been a real one on the M&A market. There’s a lot of opportunity and there’s a lot of need for companies to be acquired, to be able to sort of survive the great pause. So that’s going on. 


On an operations level infection, disease, infection control is the number one issue. And I think it’s so w we’re seeing all of this happen. We’re seeing the lobbying, a lot of lobbying, on the healthcare front. It’s really important. And what I would say is that this is the first election in the U S that I’m aware of that will probably be highly driven by healthcare issues, right? COVID is really driving and contributing to selection. And  we should expect a big change around healthcare coming out of it. I mean, President Trump and the Republican party, who’ve been talking about dismantling Obamacare for a number of years. He’s now going into interviews saying he has a healthcare plan, right? And so healthcare is going to drive this election and never happened in my lifetime.


Josh: Well, I think I can probably speak for Lucas. There’s a lot of things that have never happened in our lifetime this year. It’s been an amazing year. And I think there has been some, some positive things that have come from this crazy, a lot of negative things and Lucas and I have often talked about, and honestly talk to so many heroes on this show to where, gosh, our industry has come together so much in a lot of ways during, at least in my short lifetime and experience in the industry, the most difficult times I’ve ever experienced. And I think we’re going to have to continue to do that. I don’t feel like kind of what you said, this great pause while I’d like to say I do see the end of the tunnel. I personally don’t see the end of the tunnel yet. I’m starting to maybe see a little bit of a light, but I still think we’re several months off. What are your thoughts on that?


Bobby: I think we’re at least six months and probably more like 12 to 18. And I think it creates a business opportunity for a lot of companies that are in the midst of this to think about how can we be more efficient in the midst of the great pause, right? And so anyone who can come up with opportunities to innovate now, the door is wide open to it. The other thing that’s happening, I think is it’s really advancing innovation. I mean, what happens is not only is our work happening two to three times as fast because everything’s urgent, but in addition COVID has taken years and years of adaptive change happening in the industry and crunched it down to a very short period. So it’s accelerating all of the trends that were already happening.


Josh: I have another question for you and this may be a little bit out in left field, but I feel like with your pulse and healthcare in general, and I know you keep up with a lot of lobbying and things like that. For the providers out there that are really concerned about liability relating to COVID and realizing that, at least in the private pay senior living world, a very state regulated and kind of everybody’s watching what their state is doing relating to reform and things like that, how much live liability providers are going to have related to COVID. What is your thoughts on that? You’re in Nashville, but you kind of have a pulse of what different States are doing and national: can you give us any insight and your thoughts on that?


Bobby: Yeah, so we’ve got a lot of tort protection that’s happened across the country in a number of States. A lot of those statutes are being attacked right now, and it’s going to be an issue of whether those hold up, but there’s an interest in protecting the industry at the same time. It’s balanced by an interest in changing the industry for the better. Because as I think we can all see, when you look at the results, some places have had very difficult times dealing with COVID. Other facilities have had no infections, right, or very, very low and easily controlled. And so there’s a pretty wide disparity for how it’s been dealt with. So now I think we’re looking at how to put best practices together in the industry to deal with this tort reform is a big part of that. And I think it’s needed.


Josh: So talking about lobbying, are you seeing the most effective lobbying for the industry, Bobby, being done by the big conferences? Are you seeing some individual players out there that are really investing a lot of dollars to have their voices heard? Or is it pretty consistent unified front? I mean, any thoughts around that?


Bobby: So, great question. There are. I would say it’s both. The industry organizations in senior living do a very good job of putting dollars into the lobbying efforts. And I’m sorry to say that I was really looking forward to going to the ASHA PAC meeting this year, and it’s not going to happen because none of us can travel right? Put we all still need to be giving to the PAC, it’s important. Asha is doing a lot. NIC’s doing a lot. Other organizations are doing a lot with it, but as well, a number of companies are dealing with it and you’ve got groups put together, dealing with it. And lobbying is a real interesting thing because nobody recognizes this. Everybody thinks, well, I got a legal problem. How do I deal with it? And you can deal with it in core, or you can deal with it by changing the law, if you’re lobbying and the returns, the ROI on lobbying is probably, well, it varies, but it’s in the hundreds of percent return, right? So typically the return on lobbying is 300 to 500 to 700%, but there are examples of the return on lobbying being like 7000% on the dollars put into lobbying. So, it’s a very effective method. 


Unfortunately, we’re so polarized right now with the parties that it’s difficult to make progress, right? There are a lot of people who think gridlocks a better thing in Washington because we won’t make, that way no party has too much much power. That’s true. But at some point we’re going to have to advance in the country, technologically and everything else and make them move forward. And so I will tell you that lobbying is hugely effective right now.


Josh: Well, I’ve always believed that as well. And I feel like if you, if you aren’t involved in lobbying, which I believe is just part of helping shape your future you’re going to be just reacting to what’s happening to you rather than what, what you can help be part of making a positive change. One other, then I’m going to shut up and let Lucas ask some questions. 


But so we’ve talked a lot on our show and we’ve been hearing, certainly no experts, but talking to experts like yourself about the relief programs for providers. And that’s been starting to open up our industry organizations have, I think, done a good job at keeping us informed of what’s coming down the pike and what’s availableI’m talking to a lot of developers out there that had projects at various stages of beginning construction, or maybe on the verge of starting construction, that their projects came to a complete halt, or they’ve had some such significant delays that many of them their projects have tanked. They’ve gotten stopped and it’s costing hundreds and hundreds of thousands of dollars. Obviously many of them are impacted differently than others, but do you foresee that it’s going to be on the agenda or is it already in the pipeline to have some relief dollars for the pipeline of senior living and senior housing? Or is that something that’s just very burner in an afterthought?


Bobby: It’s clearly gone towards sniff, right? With infection control early on. There has been some for the Alf community, but it’s, we need it for all of the senior living community, because this is an important part of healthcare. And it’s interesting. One of the problems that the senior living community has suffered from for decades is it’s not considered necessarily integrated into healthcare, but a lot of our healthcare dollars go to senior housing. 


So I will tell you, I don’t know the answer on where the programs are with this, but I will tell you that my opinion is a lot of money needs to come toward this. We need a stimulus program again, in the U.S. regardless of industry, we need some of those dollars specifically coming across the senior living industry, because you can’t leave all those projects out there. 


‘m a little bit afraid. One of the things I’ve been telling people is that you can track the market to see how large companies are doing, whether it’s distorted or not, but that tells you something about large companies. We don’t really have a good measure of how smaller companies or midmarket companies are doing that are not on the national exchanges. And so I’m a little bit afraid that we will come back from COVID. And what we’ll see is it’s like watching a meteor shower from space as the meteors hit the earth. If you’re standing on the moon, it’s just a bunch of puffs of smoke all over the atmosphere. And when I go out to- we’re back in the office now with masks and everything- and when I go out to lunch and look around, it’s pretty scary.


Josh: I would agree with you and kind of what I think you were alluding there is, we see the big, the big boys, right? The big companies. And it’s easy to measure that, but you know, the mom and pops, the small businesses of the world that many of them are not hurting as much as others, but there have been a lot of hurt, small businesses. It seems like that’s been kind of the fabric of the U S and so it’s scary to think when small business suffers in the U.S., you have to think about the long term ramifications of that on an economy, right? 


Bobby: That’s right. And it hurts all of us, and it hurts the senior living industry, because if you erode wealth in the U.S., you erode the ability of people to pay for care when they’re older. So this is something that we really have to think about. I’m strongly in favor of more stimulus programs now, because I think it’s the only way, regardless of political positions on anything, we clearly need it. You can’t have food lines and evictions and homelessness and everything else spiraling out of control, because it affects everything. You can call it a trickle up effect or trickle down effect. It will affect all of the economy and all of the people.


Josh: So, senior living fan, I’m looking for some smiles because I always get like rainbows, like smiles from you, no matter what we’re going through, what would be your take on all this? 


Lucas: Y’all, I’m sitting here as a bystander. I’m thinking like, gosh, I take notes on this. Wow. I didn’t know that. Okay, great, great. What am I going to say? And then I thought, golly, let’s end with something positive. Just, you know, to your point, Josh, is there something positive? I don’t know. I mean we always try to bring some type of hope or inspiration with the program. The reality of our world today is that it’s very challenging. Right. But are you optimistic that there, even though with all these question marks and reality checks and all this kind of stuff, is there some sort of a silver lining somewhere?


Bobby: There is and it is that change always creates winners and losers. And so this creates a lot of opportunity for people in the market who want to make a difference. In addition for seniors, for strong operators and those committed to quality of care for those looking to innovate, this sort of disruption just makes it. It will accelerate that process and give people the ability to change healthcare and make it more efficient. And that’s good for all of us, right? At the end of the day. 


So I’m hopeful, I’m hopeful that we will get more stimulus. I’m hopeful that we will go through a, let’s call it nonviolent election process. And I think there’s a good chance of that based on U.S. history. I’m hopeful that we’ll find a vaccine soon, and I’m hopeful that that will have some sort of call senior level guidance on best practices for dealing with COVID because masks sure seem to be working in short and quick testing sure would. And if we could all get back to normal a little bit, it’d be a great thing. 


One followup note on that too, is one of the things I’m excited about coming up is I think there’s huge opportunity in affordable housing across senior living. And I don’t mean low income housing. I mean, affordable. I think that’s one of the places that we’re going to see a big explosion over the next few years, and that we all need to be trying to help in that market because there’s a big demographic that doesn’t have enough. There’s not enough capacity to take them as they age into it. 


We’ve actually been looking at creating a nonprofit to help sort of foster and promote some of that. And to help a number of senior living companies make the transition more easily as they adapt in what’s a really different environment. And so that I’m hopeful about all of that too. There are a lot of funds and there’s a lot of money available to help companies move from where they are now to where they need to be, to have long term survival prospects. 


Lucas: Bobby Guy partner at Polsinelli at a Nashville, Tennessee. It is a pleasure to come back to this podcast, even though you know, at the beginning of the year, we just didn’t know what was gonna happen. So any final thoughts, Josh? 


Josh: Well, I was just gonna say, thanks so much, Bobby, for being here with us. It’s been a great conversation. We always love having you on the show. Difficult times. There’s always opportunity and thank you for your insights. Can’t wait for our listeners to hear this show and thanks for joining us. 


Bobby: Thanks guys. Take care. 


Lucas: You too, Bobby, and thanks to everybody for listening to another great episode of Bridge the Gap.

Ep. 138: Bobby Guy