The following is a transcript of our interview with Tom Lavallee. To find links to the audio files and more information about the interview, please click here.
These transcripts are made possible by a gift from the NNEAHE.
These transcripts are made possible by a gift from the NNEAHE.
Mark Bonica:
Welcome to the forge, Tom.
Tom Lavallee:
Thank you.
Mark Bonica:
You went to Wister State College in Wister Mass. What brought you to Wister state, and what did you study there?
Tom Lavallee:
I started college at UMass Amherst and realized fairly early on that it wasn’t a terrific fit. However, I wanted to continue to give it a go there, and somewhere along the line, after three semesters, my parents got divorced, and I needed to come up with a more reasonable option in terms of cost for college. I had some friends at Wister state. I gave it a looksee, and it was certainly affordable. I had to pay my own way through college, and I could make that work. I commuted, I didn’t live there. I enjoyed the experience, and it’s worked out great. I studied psychology there. Not really knowing what I was going to do with that degree, I just enjoyed the coursework, and so that’s what I focused on.
Mark Bonica:
All right, so you graduated from Wister state, and it looks like around the time you graduated maybe you started working at Southern Worcester County rehabilitation center?
Tom Lavallee:
I did. I did. That was my first job out of college, and it was a terrific job. I got to work with folks that had intellectual disabilities, first in a independent apartment setting where I would go in at night, take them grocery shopping, balance their checkbook. It was incredibly rewarding, it didn’t pay a lot, but I enjoyed the work. Eventually, I began writing behavior management programs for that same population.
Mark Bonica:
For the same company?
Tom Lavallee:
Yes, for the same company. It was in advancement, a promotion if you will, and I enjoy doing that a great deal as well. It was a little less hands-on than working with the folks directly in the apartment setting.
Mark Bonica:
You were called a caseworker initially?
Tom Lavallee:
I was, and then a behavior specialist.
Mark Bonica:
Okay. This is long-term care. Or it was something else?
Tom Lavallee:
It was something else. It was independent living in apartments, fully subsidized by Mass health. These folks could do a fair amount for themselves. They weren't supervised 24 hours, seven days a week. It was limited supervision, whereas long-term care is 24 hours, seven days a week of oversight.
Mark Bonica:
Do you consider this part of the spectrum of long-term care do you think?
Tom Lavallee:
No, I think it’s opposite. It’s a different thing. It was a different thing. It was not a healthcare model at all. If somebody got sick or needed attention, they were sent to the emergency room. There weren’t any clinical folks involved with this particular program.
Mark Bonica:
Okay. So you left southern Wister in 1991 to go to Liberty Commons of Chatham where you took on a job as a social worker. What kind of organization was Liberty Commons?
Tom Lavallee:
Liberty Commons was 132 beds skilled nursing facility located in a beautiful section of Cape Cod down in Chatham. The path that got me there is interesting as well. I mentioned early on that my parents broke up while I was in college. My mom moved down to the Cape. She was a director of nursing.
Mark Bonica:
At Liberty?
Tom Lavallee:
At Liberty Commons.
Mark Bonica:
Oh, very nice, okay.
Tom Lavallee:
We had been a little bit apart while I was finishing school, and she had moved down to the Cape. She called me one day and said, “What’s your degree in?” I said, “It’s in psychology. I got a psychology degree.” She said, “Well, would you be interested in being a social worker in our nursing home? There’s a vacancy.” I gave it some thought, and I said, “Boy, I can move to the Cape, reconnect with mom, make some more money" because it was better pay. I gave it a shot, and I went down, and I never left. At the time, I was living in a small town near Wister called Northbridge Bass. I moved down to the Cape in 1991 at the age of 25, and haven’t looked back since.
Mark Bonica:
What does it mean to be a social worker? Your degree was in psychology, so you weren't a social work major.
Tom Lavallee:
Right. I had to sit for the LS WA exam, which I didn’t qualify for right away. I needed to have oversight by a masters level social worker. The company paid for that oversight. Shortly after, I think it was six months or so, got my LSWA.
Mark Bonica:
What is that?
Tom Lavallee:
That’s a licensed social work associate. Which allows you to write care plans, counsel families who are … Yeah. It’s a difficult process when folks get admitted to a nursing home, and it’s often harder on the family than it is the patient, but it allowed me to interact with those folks, counsel with them, talk with them, listen to their issues and concerns, and try to resolve them, all under the direction, or supervision if you will, of an MSW.
Mark Bonica:
As an associate, are you always supervised by an MSW?
Tom Lavallee:
Correct. At least in the skilled nursing facility sector. I couldn’t speak to other areas of social work, but certainly within a skilled nursing facility they require oversight.
Mark Bonica:
As a LSWA, you were writing care plans as people are admitted. What are you actually doing? What does that mean?
Tom Lavallee:
A care plan is developed for each patient when they’re admitted to a nursing facility, and it’s a multidisciplinary care plan. Each discipline, nursing, rehab, social services, dietary, they all have their section that they’re responsible for. As a social worker, often my section included discharge planning. Are these folks going to stay long-term, or are we going to be sending them back to the community? Included things like preference for visitation. All sorts of those social aspect of the individual’s stay at the facility was what I was responsible for.
Back when I was a social worker, there wasn’t a lot of discharge planning. Most people came to the nursing facility, and that was it. They weren't going home. The other responsibilities that I had included ordering clothing for folks that didn’t have family support to do so, working with them on some finances if they had a personal needs account and they wanted some spending money. It wasn’t like social services are today in skilled nursing facilities. It’s a much more dynamic profession. It’s evolved a great deal over time.
Mark Bonica:
How much were you involved in the day-to-day life of the residents in that role?
Tom Lavallee:
That was the neatest thing, and it goes back to when I was working with folks with intellectual disabilities in their apartments. The greatest thing about it was the interaction with the client. As a social worker, I spent a great deal of time just talking to residents, getting to know them. I organized the men’s club, brought them to a Red Sox game. It was a terrific, terrific job. We didn’t send people home, as I said, back then. People died there. The end-of-life stuff was difficult, and I don’t think I excelled at that for sure. Those were tough things to handle.
Mark Bonica:
That’s an interesting point. Dealing in long-term care, you do deal a lot with end-of-life stuff. How did you come to deal with that? You’ve seen that throughout your career now.
Tom Lavallee:
Yeah, I have, and I’m removed from it now, but when I was a social worker and then administrator, I handled that stuff quite a bit. Getting to know the patient’s as a social worker, it was hard. We had a lot of support. Our facility and all facilities have contracts with hospice agencies who provide a great deal of service, both spiritual, some guidance, bereavement counseling if necessary. That always helped. I certainly leaned on them when I was a social worker. Yeah, the tough times. Often because our business results in somebody passing away, it can be tough with families who have expectations that probably aren’t sometimes in line with what’s going on medically with their loved one. Those conversations can be very difficult. I think I handled them pretty well. As hard as it was, I enjoyed making folks feel better when I could.
Mark Bonica:
Yeah, well it seems like you were successful, because after less than two years, you were promoted to the director of resident services. What was that position?
Tom Lavallee:
I oversaw the social service department and the admissions department. It really, I think, was a key step in my career. It gave me exposure to the business side of nursing facility operations that I hadn’t been exposed to prior. I got to know how it all came together in terms of private pay, versus Medicare, versus Medicaid. How that all fit together. Quite frankly, what kind of clients were better to pursue than others for my financial standpoint. Getting to know some of the asset issues that families deal with when coming into a nursing facility. Very few folks come in with long-term care policies.
Most are admitted, even back when I was the director of resident services, most are admitted directly from the hospital following a three day stay qualifying for Medicare benefits, and that was usually the, and continues to be, the method by which people come into our facilities. Then you got to figure out, okay, if they’re going to stay long-term, who’s paying for this? Do they qualify for Medicaid? If so, who’s going to help with the application? This really enabled me to case manage each of the admissions that came into our facility, and it really was a jumpstart for me to take off with my career.
Mark Bonica:
Okay. You realized at that point maybe you liked the business side of the healthcare.
Tom Lavallee:
Yeah. I thought it was very interesting. I also knew that if I continued to grow that it would be good for my career financially. Yeah, it was pretty early on that I said to myself, “I think I can run one of these nursing facilities.” I focused my attention in that regard.
Mark Bonica:
Along those lines, fairly soon after he started to rule as the director of resident services, you began your administrator in training program also at liberty.
Tom Lavallee:
Absolutely.
Mark Bonica:
What is that? For people who are not familiar.
Tom Lavallee:
Sure. You’ve got two paths to become a licensed nursing home administrator in Massachusetts. You can either hold a Masters degree, which I didn’t have at the time, or you can complete a six month administrator in training program. Then, either one of those two things can allow you to sit for the nursing home administrators test and get your license. I didn’t have my Masters degree. The administrator of the facility identified me as somebody that he thought he’d like to invest in. He offered to be my preceptor. To be preceptor in Massachusetts, you have to have at least five years of experience as a licensed nursing home administrator, which he had. Got together and developed this administrator in training program focusing on all areas of nursing home operations.
There was a section that I needed to spend time with nursing, time with the dietary department, time with the business office. We put this plan together, you send it into the state, and they either approve it or say, “No, this isn’t adequate. They approved mine, and we took off from there. Spent six months training and really learning all aspects of nursing facility operations. It was great, it was a great experience. Then I was able to sit for my exam.
Mark Bonica:
Is there a standard length of time that this is-
Tom Lavallee:
Six months.
Mark Bonica:
Six months is the minimum in Mass?
Tom Lavallee:
Six months is the minimum in Mass.
Mark Bonica:
Okay. You finished your AIT, as I refer to it, and you were promoted immediately to administrator.
Tom Lavallee:
The plan was, once I got my license, the owner of the company was going to give me a shot running at Liberty Commons. I said great, and that worked out that I passed my exam first try through. Back then you took your exam and you waited several weeks to get the results. Now you go, you take the exam, and you get your results in real time. I had to suffer two or three weeks waiting for the results to come back. Matter fact, I went on my honeymoon, came back, and my license was sitting in the mailbox.
Mark Bonica:
Nice present.
Tom Lavallee:
It was a great return. Great honeymoon, great return.
Mark Bonica:
You got licensed, and the owner said, “Going to give you a shot.” What does it mean to be the administrator of a facility?
Tom Lavallee:
Boy, nothing prepares you to take the helm of a nursing facility. You just have to do it. The training was great, and I think my preceptor was wonderful and really took the time to show me the right way of doing things. Until you’re sitting in the seat, it’s a hard thing to really explain. There is nothing more terrifying than your first Department of Public Health annual survey. Because now everything falls on you. It’s your report card for the year, it’s very challenging, I was very anxious, but got through it. I would say that that’s the most difficult, that was the most difficult transition to actually be the responsible individual for the outcomes of the facility. You’re the go to person. I had a lot of that responsibility as both a social worker and director of resident services, but this really upped the ante.
Mark Bonica:
Yeah, yeah. If something goes wrong, it lands at your desk.
Tom Lavallee:
Yeah, and the other thing is, you’re responsible for, at the time, we had 120 or so employees, you’re responsible to make sure that this operation is successful. Their jobs are counting on it. Yeah, the responsibility is intense. It’s a business that doesn’t shut the lights off. It’s a 24 hour seven day a week business. It’s not uncommon to get calls well after hours. It’s not uncommon to get calls during the weekend. Some of those can be very challenging phone calls. A patient elopes, leaves the facility in the middle of the night, and the nursing staff can’t find him or her. I’ve had those phone calls, tough stuff. It’s a huge responsibility.
Mark Bonica:
You’ve now gone from being a supervisor to being a manager where you’re supervising sections and supervisors. What was that transition like for you?
Tom Lavallee:
To be focused on one department, or a small subset of the facility, that was fun. To be the individual in charge of the entire operation, again, there’s some anxious moments, it’s a huge responsibility, but it’s incredibly rewarding and fulfilling when you have success and you know that you’re the one who is making the moves to gain that success. For instance, my first survey, annual Department of Public health survey went okay. My second one, we were deficiency free. My mother was the director of nursing still at the time that I was the administrator.
Mark Bonica:
Your mother is one of your employees now.
Tom Lavallee:
Was one of my employees.
Mark Bonica:
Oh, that’s an interesting [inaudible 00:18:19].
Tom Lavallee:
Yes. We did that together for three or four years, and it was tough stuff, but again, I wouldn’t have traded that time in my life for anything. To answer your question, to go from managing a small group of people, to suddenly being in charge of the entire operation, it’s a significant change.
Mark Bonica:
What's the most challenging part of managing a facility?
Tom Lavallee:
Staff and staffing are two immensely challenging, two big challenges that we have in our industry. It was tough back then, and it’s tough now.
Mark Bonica:
What makes it challenging?
Tom Lavallee:
A couple of different things. One, back when I first got my license, unionization was a big issue on Cape Cod. There were few union facilities, we were union free, we endeavored to stay that way. We can get into that if you’d like, but we endeavored to stay that way, and it was a challenge. The union was very aggressive back then. We had a tough time finding staff. Cape Cod is not full with affordable housing.
Mark Bonica:
Right, it’s expensive to live there.
Tom Lavallee:
Very expensive. To pay folks a little above minimum wage to do CNA work where they could work at a Stop & Shop, it was tough. It was hard to find good quality staff and to retain them. I think that was, I think, and remains one of the biggest challenges in our industry.
Mark Bonica:
What would you say was your steepest learning curve making the jump to the administrator?
Tom Lavallee:
I was not the strongest in terms of the financial peace. Developing budgets, understanding the complexities of how a Medicaid rate is developed, putting all those pieces together to get to a bottom line that makes sense. I had a lot of help in getting there, but that was my biggest challenge is to figure that out. I was great with the people. My background in working with people, and helping people solve issues, that was not an issue at all. The personnel stuff I handled very well. Learning the financial, how the budget came together, and how you actually make money in this business, that was my biggest challenge.
Mark Bonica:
You were the administrator for Liberty for about five years, and then in 1999 you left Liberty, and you made a couple of quick changes going from Bourne Manor extended care to Cape Regency Rehabilitation and Nursing Center as the administrator to both of those organizations. You were then voted to be the vice president of operations for Oakwood Living Centers of Massachusetts, which was the parent organization of Cape Regency. How are those transitions? Then how did you come to be the vice president of operations?
Tom Lavallee:
Great questions. I left Liberty, I’ve been there for nine years, my mom was still employed, although in a different capacity. We actually, while I was there, developed and opened an assisted living facility, and my mom became the Executive Director. We had some separation, which was good, but it was still the same organization.
Mark Bonica:
Were you in charge of both?
Tom Lavallee:
No, just the skilled nursing facility. I looked at the operation and I loved it, but I said, “I’m not going anywhere. I could stay here for the rest of my career.” I just thought I had more to offer. I wanted to break away from where I learned the trade, and wanted to see if I could duplicate that in another facility. At Liberty Commons I had a lot of support. The ownership, they were there on a day-to-day basis. I had a ton of support, I chose an organization in Bourne Manor, which is a great not-for-profit organization, but they’re really hands-off in terms of their style with administrators. It didn’t fit me. I wasn’t, I don’t think, ready, to be honest, to take that jump and not have support. Different nursing facility organizations do things differently.
There are some that provide a lot of support to administrators and to the facility in general, and there are others that are hands-off and say, “Here are the keys, you run it and figure it out.” I just wasn’t ready for that, and that’s what Bourne Manor was. When the opportunity came for me to go to Cape Regency, I had the sense that there would be a lot of support, the operations manager for the entire organization also lived on Cape Cod, visited frequently. I knew there would be that support, and I said, “I want to give that a go.”
I did, and we were very successful there. In a short period of time my operations director left the organization, position became vacant, and the ownership of this company, Oakwood Living Centers, approached me and asked me if I’d be interested in that position, and I said yes immediately. This was the growth opportunity that was looking for. We had operations in Massachusetts and in Virginia Beach, Virginia. Looking back on it, I was probably a little young to be doing this level of work, but we did some good things. Ultimately, I was able to be a part of the deal that moved Oakwood to Radius, and things really took off for me from there.
Mark Bonica:
Let me pause you and backup for a second. You said you mentioned that the ownership of Liberty was often on-site. That sounds to me like maybe it was a family owned facility?
Tom Lavallee:
It was.
Mark Bonica:
So it’s for-profit then?
Tom Lavallee:
For-profit, family-owned, one majority owner, and then one individual had a small piece of it, and most of them were intimately involved with the operation.
Mark Bonica:
That was a pretty common model up until relatively recently.
Tom Lavallee:
It certainly was. There are very few family-owned and operated single entities in existence now. They’ve been bought up by the bigger chains.
Mark Bonica:
You moved from a family owned entity that was, as you mentioned, had an intimate connection with … You had an intimate connection with the owner on a day-to-day basis, to a not-for-profit, in which case, so now you don’t have a owner per se. Was Bourne part of a multifacility system, or was-
Tom Lavallee:
Yes, a system called Berkshire Healthcare Systems, which is still in existence today. They’ve got facilities throughout Massachusetts, and I think they’ve got one in Pennsylvania as well. That was a not-for-profit organization, still is.
Mark Bonica:
How is that different working for not-for-profit, versus the closeness of supervision? Were there other things that were different about it?
Tom Lavallee:
Not-for-profits have a Board of Directors as opposed to ownership. As the administrator, however, I did not have any dealings with the board. I simply reported to my supervisor, the CEO of the company, and that’s who my relationship was with. It felt different, I can tell you, it definitely felt different. I’m in a not-for profit now, when we get to that, I can explain in more detail how it all fits.
Mark Bonica:
Sure. You moved from, as we were talking, you moved to Oakwood, and you moved up to the operations director. Now, was Oakwood a for-profit organization?
Tom Lavallee:
They were. They were a for-profit interesting organization. Relatively small. We had, I think, five or six facilities in Massachusetts, one in Virginia Beach, Virginia. Each one of them its own Corporation. That’s done for protection of the ownership group. Unfortunately, financially we were in trouble prior to me taking over as VP of operations, and ultimately the whole organization was. Unfortunately, we had to file for bankruptcy.
Mark Bonica:
Interesting process to go through.
Tom Lavallee:
It was. Not something I ever want to do again.
Mark Bonica:
Yeah, I imagine. What was that like? What does that mean? Most people know that word, but I don’t think most people know what that means.
Tom Lavallee:
Sure. To simplify it, what it meant was all of the outstanding debt at the time that the bankruptcy was approved went away. The slate was cleaned. Now, in doing so, you hurt people. I had friends, for instance, our medical director who continues to be my primary physician to this day, didn’t get paid several months of his monthly stipend. He’s a small independent practitioner, and that hurt. Some of the bigger organizations, who we had stretched out to 120 days or so in accounts payable, lost a significant amount of money. Although they’re big organizations, and many of them could absorb it, my account representative, who I’ve developed a relationship with, yeah, they’re not happy about it. I get that, I certainly do.
Mark Bonica:
When you say debts, I suspect a lot of people jump to mortgages, and things like that. What you’re actually saying is bills.
Tom Lavallee:
Correct, correct.
Mark Bonica:
Like the physician I have been providing care is now not going to get paid.
Tom Lavallee:
Exactly, the pharmacy that provides medications to the facility, the medical supply company, the food supply company, all of those folks got hurt when we filed.
Mark Bonica:
Did you file while you were the operations director, or while you were at the-
Tom Lavallee:
While I was the operations director. We knew it was coming, and it was part of the deal that I accepted that this was going to happen.
Mark Bonica:
You knew that going into the-
Tom Lavallee:
I did. I did. I wouldn’t trade the experience for anything. I know now, as I said earlier, the responsibility to employees is tremendous, and the fact that we were able to salvage the facility, not have to close it, any of the facilities, not have to close any of them, to be able to transfer the company to a successful organization in Radius. Ultimately, everything worked out.
Mark Bonica:
Was that actually part of the bankruptcy process? Was the, I believe it was the homes in Massachusetts, were transferred to Radius?
Tom Lavallee:
That’s correct. We were ordered, via the outcome of the bankruptcy decision, to hire a local management company to oversee us. The ownership group and all of the offices, with the exception of me, were located in Carmel, Indiana. It made the whole thing more difficult, so that’s where Radius came in. Yes, we met with a handful of different nursing facility organizations in Massachusetts, and ultimately selected Radius.
Mark Bonica:
The ownership of the facilities, what happened with that?
Tom Lavallee:
They wanted to buy back the buildings.
Mark Bonica:
The buildings?
Tom Lavallee:
The operations, the buildings, the whole thing. They wanted to buy them back. I knew the owners well, that was their intention. When Radius came on the scene, Radius identified the buildings and the operations as something that they wanted to own. Here I was in the middle of my prior ownership group who treated me very well, and this new entity, Radius, and I really had to make a decision who was going to support and back. I played my cards right, because I chose the ultimate winners who, their bid on the facilities was higher than the former owners of Oakwood, and so Radius was awarded ownership of the facilities.
Mark Bonica:
This is an interesting process you’re describing. There were five facilities in Mass?
Tom Lavallee:
Correct.
Mark Bonica:
And one in Virginia.
Tom Lavallee:
Correct.
Mark Bonica:
You filed for bankruptcy in Massachusetts?
Tom Lavallee:
Correct.
Mark Bonica:
At that point, you were saying that the original owners of-
Tom Lavallee:
Oakwood.
Mark Bonica:
The Oakwood owners wanted to buy the facility back. Somewhere in the process they lost the title to the facilities?
Tom Lavallee:
The bank that held the note on the properties said, “We’re going to get our money or a good portion of it one way or the other.” They were the ones who really forced the management to a local company in Massachusetts, and when it came time to buy the buildings, to assume as much of the debt as possible, Radius ultimately bid more than the former owners of Oakwood.
Mark Bonica:
In this process, the debtholders essentially took title of the facilities.
Tom Lavallee:
Correct, you got it.
Mark Bonica:
Okay. As part of the bankruptcy process, the bank that had loaned the money to Oakwood now became the default owner. Then the Oakwood owners in Indiana said, “Hey, we’d like to buy it back.” Who is in charge of that process of negotiating, who actually gets to buy the [inaudible 00:32:37].
Tom Lavallee:
Yeah, so I wasn’t involved on the ultimate decision. My understanding was the bank that held the mortgage was really to decision-makers.
Mark Bonica:
What a very interesting story. You continued in your role managing the facilities during this whole process?
Tom Lavallee:
I did. Then when, ultimately, Radius took over as managers, so prior to them even being owners, they allowed me to continue to manage the Oakwood portfolio if you will. The five facilities that were originally Oakwood facilities. I got to oversee them, and I jumped into an organization that was a little bit bigger than Oakwood at the time. Radius had, I think, seven facilities. We were up to 13. I got six, and there was another operations manager who oversaw the other ones.
Mark Bonica:
Were all of these in Massachusetts? Was Radius [inaudible 00:33:36]?
Tom Lavallee:
Radius originally was Massachusetts. Eventually we get into Rhode Island, but at this time we were strictly in Massachusetts.
Mark Bonica:
Backing up again, because really interesting about the bankruptcy, so you made this step into operations and managing multiple facilities, what was that like for you?
Tom Lavallee:
It was great.
Mark Bonica:
Yeah.
Tom Lavallee:
I knew very early on once I got into multifacility operations that I never wanted to run a single entity again. It’s interesting, like it almost became … The pressure seemed less, if that’s possible. Because each facility had its own administrator, we call them executive directors, and their own executive directors who were responsible for the day to day, and as a multi-facilities operation individual, you’re responsible to bring it all together, keep them on point, on task, but they’ve really got to deliver on a day-to-day basis. Not you as the multifacility operations managers.
Mark Bonica:
Did they all report to you? Did all the executive directors report to you?
Tom Lavallee:
They did.
Mark Bonica:
Okay. How did you go about managing five facilities? I’m assuming they’re not all the same town.
Tom Lavallee:
No. That’s when I began to put a lot of miles on my vehicles, and I say vehicles because I generally have to get another one every couple of years unfortunately. I travel quite a bit. I figured it out on my own, I didn’t have any training in terms of how to be an operator of several facilities. I figured it out, and the first thing that I wanted to do, and I ultimately ended up doing, was really getting to know the executive directors as well as I possibly could. Are our styles going to jive? Are we going to be able to work together? I’m a very hands-on person. As an administrator, I knew my staff, I knew the residence, I knew my families, and I expected the same of the executive directors that reported to me.
It wasn’t always the case that they were that way. There are two styles, I think, of nursing home administrators, executive directors. Some that stay in their office, are very focused on the paper, and with all that we’ve got to do today, you could easily spend your whole day in your office if you wanted to. The other type, the one that I’m more comfortable with, is the individual that does their paperwork, gets what needs to be done in the office, and is out on the floors interacting with staff, interacting with families, getting to know their patients. Those folks, in my experience, are far more successful.
Mark Bonica:
Why is that?
Tom Lavallee:
It’s a people business. You have to have a passion for this line of work. As we spoke about earlier, not all the outcomes are fantastic, people die, families get upset with you, you don’t hit a homerun every day. You’ve got to manage people with all sorts of challenges. Our industry is predominantly a female workforce, and many of those folks are single moms. It’s tough stuff. You have to have a passion for it. That means getting to know people, caring about their day-to-day life, and being supportive. You can’t do that and in office eight hours a day.
Mark Bonica:
We need you know you were really committed to long-term care?
Tom Lavallee:
I think probably six months into being a social worker at Liberty Commons. I loved everything about it. I saw a future for me. Even back then, everyone talked about an aging population, and that this business sector is going to be an important player for years to come. It’s even more the case now. For the young folks that are listening to this, I can tell you that the Baby Boomers are coming-of-age, and the demographics of folks 65 years and older is going to grow by 80 percent over the next five years, or some crazy number like that. The need for this segment was there then, is there now, I loved everything about it very early on.
Mark Bonica:
You were the regional director of operations for Radius, from 2003 to 2009. I was going to ask you, how did you make the decision to come to Radius? It sounds like it was pushed upon you.
Tom Lavallee:
Well, like I said, I had a choice. I could have stayed with the guys from Oakwood, and maybe done a different venture, but I believed in the Radius folks early on. Even though they had several facilities, they operated them like they were a single entity. It felt more like Liberty Commons than some of my other stops.
Mark Bonica:
Did they not have separate corporate entities at each facility? What was it that made it feel more like it was just one-
Tom Lavallee:
The owner was hands-on, and the folks that reported to her directly were very hands-on as well. It was a larger company than Oakwood, but, I don’t know why, but it just felt more like family.
Mark Bonica:
Okay, so the culture matched your personality?
Tom Lavallee:
It did, and high expectations. The two owners of Radius, the two primary owners, there were several small percentage owners, but the two primary owners were very hands-on, very passionate about the business, and tough. They set high expectations for me, and everybody else that worked for them. I enjoyed that.
Mark Bonica:
What kind of facilities did Radius operate? Were they all skilled nursing? Did you have some assisted living mixed in there?
Tom Lavallee:
They were all skilled nursing when I initially joined the company, and then, five or six years into working for them, we developed an assisted living that I oversaw. I oversaw all aspects of the development, from design concept, to construction, to getting the place filled up. I was put in charge of that process. We did end up with one small boutique assisted living facility.
Mark Bonica:
What's the process of bringing a new organization into existence, like what’s uniquely challenging about it? What was interesting about it to you?
Tom Lavallee:
I’ve had the pleasure of opening two facilities. One assisted living, and one skilled nursing. I can describe the process for both. The assisted living piece, there’s much less regulatory oversight. To get an assisted living license in Massachusetts it's not a great challenge. What was a challenge, we decided that we were going to attach this particular assisted living to an existing skilled nursing facility. We did so because we knew we could create some efficiencies, dietary service for example. Oversight. In doing so, we had to get DPH approval to allow for this addition to the existing skilled nursing facility. It was a lot of municipal work, getting the town to accept what you wanted to do. We were already working off of a special variance, because we were a story higher than we should have been within this residential environment.
It was a lot of work on the municipal level, on the state level, talking to the neighborhood, making sure that the neighbors were going to be okay with additional parking, and traffic flow. There is a lot that goes into. Then, after you get your approvals and construction begins, there is oversight monitoring of the construction crew to make sure that your operation in the skilled nursing facility continues to be successful with minimal interruption. We had weekly job meetings. It was a lot of work. Once we finally got it open, of course, then the owners want you to fill it the next day. Which is not an easy process.
It took us a while to get it up and running and to be successful. The other part of it is, you’ve got to develop budgets and proformas around how much are you paying for this building? Then, how are you going to staff it? Then at what point do you break even? And then at what point do you start making money? We did a three year proforma hoping by year three that we would be a successful operation. We hit that target, we beat it by a little bit, but it’s anxious moments for the primary owners who have outlayed a significant amount of money to make this project successful.
Mark Bonica:
I’ve had a Executive Director for a assisted living facility on the program previously, but can you briefly explain the difference between … Well, maybe explain what these two categories are. Skilled nursing and assisted living. What are they, and how are they different?
Tom Lavallee:
Sure. Assisted living is primarily paid for by private funds. Long-term care insurance is some of those would pay for it as well, although I don’t see a lot of long-term care insurance, period. It’s an expensive product, and unfortunately, a lot of people don’t take advantage of it. Most of it’s private pay. Some assisted living facilities in Massachusetts do take some Medicaid patients through the group adult foster care program. We opted not to do that, because again, it was a small boutique assisted living, it was only 29 apartments. Our proformas couldn’t support public funding, we needed to charge private funds to get this thing to work.
That’s one significant difference, and in the nursing facility, yeah, the pair sources, there are multiple payer sources. Private funds, Medicaid, private insurance, new managed-care, long-term care insurance. Multiple methods of payments. That’s one difference. The other difference is just the level of care provided. In Massachusetts, you’re not supposed to provide direct care for ADLs, for medication. People are supposed to be relatively independent. The services are supposed to be more social, dietary service, oversight, housekeeping, a safe and secure environment, but not necessarily taking care of people. People do get cared for in assisted livings via outside agencies. We’re not allowed to do that ourselves.
Now, I will tell you, Mark, that’s evolved as well, and I don’t want to call people cheaters, but an assisted living today looks an awful lot like a nursing facility did for me back when I started my career. People are receiving care, but they’re not supposed to buy our own staff. In the skilled nursing facility, we’re providing all sorts of care. We’re dispensing medications, we’re inserting IVs, we’re monitoring IVs, we’re getting people up, we’re bathing them, we’re feeding them. It’s very hands-on, physician services are, we work with our doctors frequently in the nursing facility. They have to approve all the care that’s provided. It’s a much more intensive care environment than an assisted living.
Mark Bonica:
You were the director of operations from 2003 to 2009 with Radius, and then the vice president of operations from 2009 to 2013. What was the change in role?
Tom Lavallee:
I moved up from sharing responsibilities with another individual, to overseeing entire operation. It went from having a select group of facilities, to having the whole thing.
Mark Bonica:
Did you have subordinate directors that oversaw portions of-
Tom Lavallee:
I did, I did. It was just another step up in my career.
Mark Bonica:
What was the primary difference, I realize it was scope, but in your day to day operations, how did your responsibilities change?
Tom Lavallee:
That particular change, there wasn’t a lot of responsibility change other than scope. The reason that it happened is, I was toying with the notion of leaving Radius. They very much did not want me to leave, and so gave me a new title, some additional responsibility, and adjusted my compensation because of it. It was really driven by me thinking about leaving.
Mark Bonica:
It’s a reasonable thing to do with an employee that you appreciate.
Tom Lavallee:
Sure.
Mark Bonica:
What was your relationship with management for Radius? Who else was at your level in the organization, and how did you interact with them?
Tom Lavallee:
On my level, it was myself, the CFO, the accounts payables manager, the accounts receivables manager. It was a group of four or five of us. We were very much colleagues, and friends, and as a matter fact, the organization I'm with right now consists mostly of Radius folks that I worked with for a number of years. We work extremely well together. I would say our CFO and myself, we’re very tight. We’re friends, we’re tough on each other when we need to be. I keep him in check, he keeps me in check. He’s more conservative, I’m a little bit more interested in growing the business, and being a little bit more creative, and he makes sure that I don’t spend too much money. We’ve got a great relationship. I’m really blessed that my nine years at Radius have created relationships that exist to this day, and I’m working with those folks now.
Mark Bonica:
In 2013, you decided to leave Radius, and you came to Alliance Health Management Services to be the chief operating officer, which is the role you hold today. How did that transition go about?
Tom Lavallee:
Radius decided that they wanted to sell their organization, and one of the principal owners was nearing retirement age. They selected a company called Athena Health Care Systems, and I was involved with about a six or seven month transition to make sure things went smoothly from Radius to Athena. Then left Athena and got together with the CFO from Radius and decided that we wanted to work together and develop our own company. We started looking at nursing facilities to purchase, and ultimately, we decided that we wanted to start our own management company. We wanted to start managing nursing facilities for other providers within Massachusetts. We approached a not-for-profit entity that we had a previous relationship with.
Radius managed one of this not-for-profit entity’s nursing facilities, so we knew the CEO and the CFO at this not-for-profit. We approached them and said, “We’re going to start our own management company, we would like to manage your nursing facilities.” We knew that one of their contracts was coming up, so we thought the timing was right, and if we could get one entity, it would kick us off into being able to grow a company in, we thought, a relatively short period of time.
Mark Bonica:
You had decided against actually putting up the capital to purchase, and you wanted to move to management.
Tom Lavallee:
Correct.
Mark Bonica:
Okay.
Tom Lavallee:
Correct. That’s how Radius started. When Radius started, they were a management entity. They didn’t own anything. We just wanted to duplicate that model in our setting in our company. We approached this organization. Surprisingly, they said to us, “Well, we’re thinking about self managing our properties.” At the time, they had farmed out the management of their skilled nursing facilities to three different organizations, including Radius. They had come to a decision that they wanted to self manage and start their own management company. We’re pitching them our management company, they’re saying, “Well, wait, we want to start our own, and oh, by the way, do you guys want to run it?” That’s where Alliance Health Management Services was created. We started out with one facility, and have now grown to four, and we’ve got a few other facilities on the horizon to take over in 2017. We’re likely going to grow to six or seven by the end of 17, and we’re excited about it.
Mark Bonica:
The organization you were referring to earlier, is that Alliance Health Inc.?
Tom Lavallee:
It is.
Mark Bonica:
Okay, and that’s a not-for-profit?
Tom Lavallee:
That is a not-for-profit, and unlike my experience at Bourne Manor, I am involved with the board of Alliance. I was just recently named clerk of the entire organization, so not just the skilled nursing facility portfolio, but we provide foster care in California, Virginia, Illinois, and Rhode Island. That segment of the business, prior to this past year, I had not been involved with, but now I am.
Mark Bonica:
That’s interesting. What is the business model for foster care?
Tom Lavallee:
I’m just getting my arms around it, but I can give you some details. We get paid a fee, generally by municipality, for identifying foster parents, it’s a foster home, training them, and ultimately assisting with the placement of the child into the home. That’s how we get reimbursed. The model for Alliance has been, and continues to be, to provide care for the most needy children that are out there. Many of them have been involved with the juvenile justice system. Many of them have some form of illness, or behavioral disorder. Challenging kids, hard to place kids, that’s the space that we’re working in.
Mark Bonica:
Wow. Your responsibilities are now, in your managerial role, are going to include those aspects of the organization as well?
Tom Lavallee:
Sure, it’s evolving, but at this point, my involvement has been to create some synergies between Alliance Health Management Services that’s strictly working with our nursing facilities, and alliance health and human services, which is the foster care section, and bringing people together. Our human resources person at Alliance Health Management Services is now working with Alliance Health and Human Services. Our clinical director is now working with Alliance Health and Human Services. We’re bringing the two entities that were working in silos before I got involved, we’re bringing them together. That’s been my first initial charge. I’m not overseeing the operations of the foster care division. At this point, just bringing people together.
Mark Bonica:
Okay. As the chief operating officer for Alliance Health Management Services, what are your responsibilities in the organization?
Tom Lavallee:
I consider myself and my business partner, Paul Kemp, he’s our CFO, I consider the two of us but to leaders of the organization. I think, I don’t think, I know everybody else feels the same way, including the folks that oversee the parent organization, Alliance Health Inc. We work in a very autonomous way, running the day-to-day operations of our skilled nursing facilities, but unlike my experience at Radius, I’m also charged with growing the organization. We’re looking at adding additional nursing facilities, we’re looking to get into the assisted living space. We've recently reach out to some folks to start our own hospice program. We’re looking to get into the home healthcare space. These are all issues that we’ve brought before our board, who very much want to see us expand our footprint in healthcare in Massachusetts. That’s the big difference that I’m charged with growing the organization.
Mark Bonica:
Wow, that’s exciting.
Tom Lavallee:
It is, it is.
Mark Bonica:
You manage six or seven I think you said?
Tom Lavallee:
We currently manage four of the seven Alliance owned facilities. The four that we manage, one is located in Brockton, we’ve got one in Quincy, Braintree, and one out in Baldwinville Mass, which is northwest of Wister, about nine miles from the New Hampshire border. It’s very much a out on its own, standalone facility.
Mark Bonica:
[inaudible 00:55:55].
Tom Lavallee:
Right, right, exactly, exactly.
Mark Bonica:
Who knows what’s out there.
Tom Lavallee:
Exactly. The remaining three are managed by Bane Care, and they’re on the North Shore. They’ve got existing contracts, Bane Care has an existing contract with Alliance that will eventually expire, and we hope to be able to manage those at some point as well.
Mark Bonica:
When you say you’re looking to expand, you’re looking to acquire additional homes or facilities for Alliance? Or are you looking to just extend the management services? Or is it a mix of both?
Tom Lavallee:
Both. I think our preference would be to acquire existing facilities. The Baldwinville facility is a really interesting one. It was a standalone not-for-profit. There are a few of those in Massachusetts, not many left, but this was a standalone not-for-profit, and they weren’t doing well financially. They approached us, their board approached us and said, “Can you help us out? We’re thinking about closing, we don’t know what to do, we’ve got to figure out a way to make this entity viable again.” Ultimately, we ended up acquiring the facility, but it wasn’t a purchase. It was just an assumption of the existing entity into our board. The only fees associated with that deal were the legal fees, and there wasn’t any additional debt taken on. It was a great deal. Ideally, we’d love to find other standalone not-for-profit’s that might need some help.
Mark Bonica:
You’re also exploring extensions of the organization into other related areas. You don’t currently have assisted living you said?
Tom Lavallee:
We don’t.
Mark Bonica:
You’re looking at that, you’re looking at home healthcare-
Tom Lavallee:
And hospice.
Mark Bonica:
And hospice. Do you see purchasing an existing organization, or merging with some existing organization? Or do you imagine starting from scratch?
Tom Lavallee:
There is a moratorium on starting your own certified home care agencies. That’s not going to happen. We'd have to acquire one, and yeah, we’ve looked at a few. Thus far what we’ve looked at is just too big for what we are right now. None of us within our organization have any home healthcare experience. It’s going to be an interesting endeavor, but we’ve got to do it, Mark, because yeah, we’re discharging from our Quincy and Braintree facilities, we’re discharging, just to use rough numbers, 100 patients back into the community on a monthly basis. About half of them are involved with an ACO who have their own preferred home care agency. We can’t touch half of them. The other half, we’re just giving the business away.
From my perspective, we can control quality, and we certainly, eventually, can make a profit if we do it right, and take better care of people. I think it’s a no-brainer that we want to get into the home care space, we’ve just got to find the right organization that fits with us. On the hospice front, there is not a moratorium, we can start from scratch if we want to. We’re exploring that opportunity now. We’re also exploring buying an existing hospice. We have, routinely in our facilities, 10 to 15 patients who are receiving hospice services on a daily basis. We’ve got contracts for three, four, five providers in each of our facilities.
There’s no real continuity of care, and it’s a space that can be profitable. I use the term profit a lot, even though we’re not-for-profit, we run it very much like back in the Radius days. We expect to make our budgets, to exceed our budgets. The big difference is that, at the end of the year, or if it ever gets sold, no one cashes out. It goes back into the organization. I think it’s a nice model, that we’re taking good care of people, and that’s the most important thing.
Mark Bonica:
You mentioned the ACO, and I was interested in hearing your thoughts on that. Two things on this, one is earlier in our conversation, we were talking back into the Liberty days, you didn’t discharge a lot of people. You said people came there, and that was where they were going to end their days. Now, that’s not true so much anymore.
Tom Lavallee:
Correct.
Mark Bonica:
A lot of the business for skilled nursing is in and out.
Tom Lavallee:
The majority of our patients that come to us end up getting discharged back to the community. The vast majority.
Mark Bonica:
How did that change the business model? How did that change the nature of the business that you do?
Tom Lavallee:
Boy, it changed it significantly. Back when I started at Liberty Commons, a good portion, a substantial portion of the facility were private paying individuals. When the resources ran out, they were eligible for Medicaid, and Medicaid, when I first started, wasn’t the end of the world. As the years have gone on, unfortunately, we’ve either had our Medicaid rates frozen at a certain level, or we’ve had very small increases. To make a long story short, we lose money now every day on our Medicaid patients. That’s just not in my organization, that’s throughout Massachusetts. I happen to be the board at Mass Senior Care, so I’ve got an intimate knowledge of how Medicaid is a losing proposition unfortunately.
Mark Bonica:
Is Mass Senior Care Medicaid for senior-
Tom Lavallee:
Mass Senior Care is the organization that all, not all, most facilities in Massachusetts pay a fee to. They’re our oversight group, they're the group that lobbies for us at the Statehouse. They’re the group that helps oversee everything that we do. It’s a voluntary-
Mark Bonica:
It’s an advocacy org?
Tom Lavallee:
It is, it is. It is. Medicaid is a losing proposition. We figured out, somewhere in the mid-nineties I guess it was, that Medicare was a winning proposition. We got very heavily involved, all nursing facilities, in doing short-term rehabilitation. It really has shifted from private pay Medicaid, to Medicare, and in many ways, Medicare has subsidized the Medicaid program.
Mark Bonica:
Most of your patients or residents today are not long-term care residents, is that true?
Tom Lavallee:
Most of our admissions are not long-term, but I would say the majority of the patients in our facilities are long-term. I know that might sound confusing.
Mark Bonica:
I get what you’re saying. I’ve talked to other homes where they have a … A greater portion of their beds are short-term. Okay. You mentioned ACO, so I’m really interested how the ACO’s, and what it sounds like is they’re influencing the practice, they’re influencing the flow of discharges, and where people go.
Tom Lavallee:
Absolutely. Baldwinsville, a little facility out West, they’re not involved with any ACO’s. They’ve got one primary feeding hospital, Haywood Memorial Hospital, and that’s it. Our other three are heavily involved with ACO’s. At Braintree, we’ve got preferred relationships with Atrios ACO, bid Co. partners, same at Marina Bay. At West Akers and Brockton we are involved with Stuart to ACO. Really, what’s happened with these ACO’s is they’ve setting expectations for length of stay and for the cost of care that has really made it difficult for us in terms of … For instance, on length of stay, their expectation is 10 days or less.
That’s a huge difference between our traditional Medicare patients. They actually send in case managers from their ACO’s to monitor and to participate in our care plan meetings, and to really push and drive the discharge process. Yeah, that’s changed things substantially. The Stewart ACO model, that’s the most interesting one of all that we work with. To be in their network, you have to agree to give back 10 percent of your Medicare revenues per patient. There is no choice, you either do that, or you’re not in the network. If you’re not in the network, that means you run the risk of losing admissions. We are involved with them in two of our facilities, and it’s a tough deal. We’re not making it up in volume unfortunately, which is what we thought we would going into it. We thought that with all of these organizations. I don’t really believe that’s been the case.
Mark Bonica:
You’re not actually part of the ACO, you're contracting with ACO?
Tom Lavallee:
That’s correct, that’s correct.
Mark Bonica:
Okay. They’re almost like another layer of managed care then.
Tom Lavallee:
They are, it’s more intense though. Like I said, the expectation is shorter length of stay. Taking care of people better for cheaper. That’s really the mantra, if you will.
Mark Bonica:
They now have an interest in that, so an ACO is an accountable care organization then, so the model here is a shared savings model where the ACO makes money from Medicare if they’re able to reduce the cost?
Tom Lavallee:
Sure.
Mark Bonica:
That’s why they’re pressuring the skilled nursing facilities to reduce costs?
Tom Lavallee:
Right, exactly. They’re incentivized to drive down the cost of care per patient for Medicare patients, and so that means they push us to make sure that we’re doing things efficiently as well.
Mark Bonica:
Then you’re looking at, what we call, vertical integration further into the stream to acquire a home health agency, so as the discharge from the skilled nursing facility happens, it could still stay in your organization, just to a different portion of the organization. You go from a Alliance skilled nursing facility, to a Alliance home health care facility, not facility, but alliance home healthcare care.
Tom Lavallee:
Exactly. That’s the notion. That’s the idea. Because we’re giving away that care right now.
Mark Bonica:
Okay. interesting. Is that a profitable business line?
Tom Lavallee:
The numbers that I've looked at from various agencies, the short answer is it can be. It’s all about volume, and we've got the volume. We got the patients to take care of. Yeah, I think we can make it work.
Mark Bonica:
What is the competition for residents or patients in this area? We’re in Eastern Massachusetts, it’s a densely populated area, lots of hospitals, I imagine lots of nursing homes, so the competition must be somewhat fierce.
Tom Lavallee:
It is, it’s very challenging. Again, back when I started, hospitals would fax us a referral, and we'd make a decision based on some pieces of paper, and admit a patient, and there wasn’t a lot of heavy lifting. Now we’ve evolved into having screeners, multiple screeners that visit these hospitals on a regular basis. Market and fight for patients. It’s been an interesting transition. Typically, these screeners are registered nurses who are very polished, both clinically, and in presentation, they’re really marketers for us. We would have had to spend significant dollars on bringing in these new positions to fight for referrals. It’s a very competitive business.
Mark Bonica:
The means whereby people come to your facilities are discharges from a hospital after some sort of procedure, but also, perhaps from the home. Is that the case?
Tom Lavallee:
Yeah, we still get direct admits from the home. I would say the vast majority though go to the hospital first before they come to us. I think that’s for a couple of reasons. One, home care has really taken off. I think intentionally through Obama care, but as proud as I am of our nursing facilities, I don’t have any hesitation in saying there is no place like home. I think folks want to stay home as long as they can. I think it takes a significant event for them to end up with us. Typically, that means going to the hospital first. Yeah, we get a fair amount of direct admits from home.
Mark Bonica:
You’ve spent 25 years in the long-term care industry now. What makes a good nursing home or a long-term care facility? If you walk in and let’s say you are evaluating to purchase one, and you walk in, what are you looking for?
Tom Lavallee:
Great question. A physical plant is important I think. When I tour a facility, and I expect this of my facilities, I expected to be clean, I expect them to be odor free, I expect the staff to be pleasant, and outgoing, and inviting. You know, it doesn’t have to be the newest facility on the block, because we have a variety of homes. We’ve got some facilities that are just gorgeous when you walk into them. We've got some that are more homey. It’s really all about the staff. At the end of the day, that’s the most important thing. The quality and quantity of staff. When facilities are having challenges financially, often, the only place to make changes that will influence the bottom line is in labor. I want to know that the staff are well cared for, that there’s a sufficient number of them, and that they care about what they’re doing. That’s the most important thing.
Mark Bonica:
What makes a good nursing home administrator?
Tom Lavallee:
All right, somebody that’s outgoing, has a passion for the business, and likes people. I don’t think people that are reserved are meant for this line of work. You've got to be outgoing. It’s a people business more than anything else. Most organizations are going to be able to provide you with the financial assistance, the back door counting, if you will. That’s an important strength, but it’s not the most important. You’ve really got to enjoy working with people and dealing with people. That’s the most important thing.
Mark Bonica:
How has the industry changed?
Tom Lavallee:
Well, as I said, it used to be a place where folks came to live out the remaining days of their life. Now, I think of the rehabilitation centers. Most nursing facilities have changed their names to skilled at the end. Skilled nursing and rehab center. Because that’s really what we are. The skill set of nursing staff has been enhanced greatly over the years, and it’s had to. There were no IVs when they started. No IVs in nursing facilities when I started, or very few. Now it’s a common practice to even start our own IVs. We’re taking care of much sicker, much more challenging patients than we ever did before, and with that, we’ve had to increase our costs, particularly our labor costs. Yeah, it’s evolved and changed quite a bit. It feels like a hospital setting in some cases.
Mark Bonica:
There’s been a lot of consolidation. You mentioned Athena. I believe you said Athena was the most dominant-
Tom Lavallee:
They’re a big player in Massachusetts.
Mark Bonica:
Big player in Massachusetts. I know Genesis owns many of the facilities in New Hampshire.
Tom Lavallee:
Yep. yeah, there’s Life Care, there’s some very big organizations out there.
Mark Bonica:
What are your long-term concerns from a strategic perspective? Where do you see the industry going in the next 5 to 10 years?
Tom Lavallee:
We’re going to be a very big player in the healthcare space. I have no doubt about that. The need is going to continue to grow, the age population is going to continue to grow. There’s always going to be a need for us. I think the drive for home care and assisted living’s have been, I think, the two greatest challenges to the skilled nursing facility sector. Virtually, all of our private pay censuses dissipated. They’re all and assisted living’s. I don’t blame them. If you have the resources and the means to go into in assisted living, they typically are newer, more attractive physical plants, and I can understand why people would choose that direction. In home care, there’s no place like home. Those two sectors have really challenged us. That’s our biggest challenge as we move forward.
Mark Bonica:
I just want to ask a few questions about leadership I want to wrap up on. What would you say is your leadership philosophy.
Tom Lavallee:
Leaders have to set the tone and the example. Create expectations, and in order to do that, you got to be willing to be out there and engaged with folks. When I first started in the business, the owner of Liberty Commons typically started his workday at 6 o’clock in the morning, and typically didn’t leave until six in the afternoon. Or evening I should say. I said, “Boy, if I’m going to be a part of this organization, I better be an early riser, and I better be willing to put in long hours.” I did. Whatever you expect out of your employees, you better be doing it yourself. I think that the best leaders are consistent, predictable. Employees need to know what they can expect out of their leader on a daily basis. You got to be consistent with people.
Mark Bonica:
What do you look for when you’re hiring a leader? You’ve been a leader of leaders for a long time.
Tom Lavallee:
I have, and I love interviewing folks. I love the interview process, I love sitting down with people, particularly younger people. I want to make a quick pitch for our industry. The University of New Hampshire’s program is fantastic.
Mark Bonica:
I didn’t pay him to say that.
Tom Lavallee:
Going back to the advocacy organization, Mass Senior Care, where I am a board member, I’ve said to the board, very recently, and my son’s at UNH, he loves the program, why don’t the state schools of Massachusetts have that program? The industry can be stale at times. Sometimes I interview folks that I’ve seen two years ago that circulate from one nursing facility to another. We’ve not done a good job in Massachusetts of getting the word out about how special, important, and fulfilling this business can be. I think it starts at the college level. When I interview young people, I get a kick out of it. Why are they interested in joining my sector?
I’m looking for people that are outgoing, and are energetic, and have a passion, are willing to learn. It’s a very challenging profession. You've got the regulatory component, you got the financial component, you’ve got all the social issues that you got to deal with, you got the personnel, you got the fear of unionization, you’ve got all these things that are out there, and you can’t figure them out right away. It takes time. It’s the kind of job did you really have to do it for a number of years to become proficient in it. The University of New Hampshire’s preparing young folks to be in this business, and I’m appreciative of it. We need to do a better job in Massachusetts.
Mark Bonica:
What is organizational culture, and why is it important? What aspects of organizational culture are particularly important to you?
Tom Lavallee:
Hard work, and there’s no shortcuts to getting the job done. You’ve got to put in the time. The culture that I’ve tried to create, and I think I’ve been successful in creating, is one where I expect my managers on the corporate level to provide support to the facilities. It’s not that the facilities are reporting to my corporate team, we’re there for them. We’re there to provide assistance and support. The culture that I’ve tried to create is one that people work hard, people care about what they’re doing, it’s all about outcomes.
In the not-for-profit world, our board is not as concerned with the bottom line as they are about being associated with facilities that take good care of people. The culture that we’re creating in this new company, relatively new company, we’re three years old now, is let’s take good care of people. Let’s have good outcomes. We’re going to be successful financially if we do that. Our mission is quality, quality, quality. That’s what my board cares about, and I’m in sync with that.
Mark Bonica:
One of the areas that I’m interested in from a research perspective is mentorship. I wanted to ask just a couple quick questions about that. Did you have a mentor or mentors early in your career?
Tom Lavallee:
I did.
Mark Bonica:
How did those people help you?
Tom Lavallee:
The person who is my preceptor for my administrator in training program was, and continues to be a mentor for me. He is the chairman of the board at mass Senior care, and he’s the reason that I’m on the board. He asked me to be. With any luck, he’s going to be the preceptor for my son, if I can convince him to join this industry. He was a guy that, again, showed up early for work, stayed late. It was important for him to get to know the patients, the families, the staff. We had regular social events with our employees. He didn’t look at that as a burden or an inconvenience. It was something that he enjoyed doing. He’s a super guy, and dedicated to the profession, cares about people, and has always run a top-notch organization. I strive to be like him, and to create something that he’s created.
Mark Bonica:
What would you say good mentors do, if you want to define the job description, what does that include?
Tom Lavallee:
It includes being there for people. I could pick up the phone and call this individual any time, ask any question, and he’d be there for me. He’d be supportive of me. He’s always set an appropriate expectation, he’s a consistent guy. He doesn’t always have all of the answers, but if he doesn’t, he’s connected enough that he can find them for me. I think a mentor genuinely cares about the individual that they’re mentoring. I’ve done a few of them myself.
Mark Bonica:
I wanted to ask you, have you been a mentor?
Tom Lavallee:
I have. I’ve had a couple of administrators in training. One still in the field, and others not. One took it more seriously than the other. I fulfilled both of the commitments, the six month commitments, even though I thought one of them really wasn’t into it. It’s hard to change behavior or what’s inside of somebody. I enjoyed the process. I like to think that at least the one person who’s still in the field, she reaches out to me on occasion, and I like to think that I’m still there for her. They’re terrific experiences. The other nice outcome of being a preceptor for an administrator in training program is that you got continuing education credits for doing so. To maintain your Massachusetts nursing home license, you need a minimum of 40 CE use on a annual basis. You get, I think, 20 for being a preceptor. That’s another benefit of doing it. Right.
Mark Bonica:
Speaking of certifications, how important our professional associations for your development and for the field?
Tom Lavallee:
We are required, as I said, to get continuing education credits on an annual basis. The American College of Healthcare Administrators is an entity that I think is important to be a part of. First of all, I’m on their board as well in Massachusetts. They are education focused. They’re all about enhancing the skill set of, specifically of administrators. They’re an important group, and you can become a certified nursing home administrator, which I happen to be through the American College of Healthcare Administrators. That allows, in some states, for you to get a license without having to retake the test for instance. I was licensed in Massachusetts, but because of my CMHA certification, I was able to get my Rhode Island license when I opened up a facility down in Rhode Island for Radius. There are benefits there. The other benefits are just, you make connections. There are regular meetings, and outings, and it’s a great way to make connections within the business, because you never know where you’re going to land.
Mark Bonica:
Maybe you could make one last pitch here. For a young person thinking about a career in health, why should they think about long-term care, rather than, say, an acute care facility?
Tom Lavallee:
Sure, it’s a segment of healthcare that’s going to be in existence for a long time. There are many more skilled nursing facilities in New England and throughout the country than there are hospitals. I just think there’s greater opportunity. It’s a worthwhile profession. If you’re a hospital CEO, I doubt that you have the opportunity to interact with patients and families in an intimate way as you can as an administrator. It’s powerful stuff. I just think the personal aspect of getting to know folks and working directly with folks in a much more intimate way, and in a much more intimate setting makes us a segment that it’s worthwhile to explore.
Mark Bonica:
Thank you so much for your time today, this has been really educational.
Tom Lavallee:
My pleasure, thank you.
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