From a social worker to trusted industry advisory, Suzy Koenig, CEO of SAK Management Services, discusses her journey as an administrator and then owner. With a knack for turnarounds, Suzy shares her experience in assisting with distressed assets and solving problems on behalf of communities through receivership. 

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Intro

Welcome to season eight of Bridge the Gap, a podcast dedicated to informing, educating, and influencing the future of housing and services for seniors. The BTG network is powered by sponsors, Aline, NIC MAP, Procare HR, Sage, Hamilton CapTel, ServiceMaster, The Bridge Group Construction, and Solinty and produced by Solinity Marketing. Bridge a gap in three two.

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00:43 - 00:58

Lucas McCurdy

Welcome to Bridge the Gap podcast, the senior Living podcast with Josh and Lucas, a beautiful day here in San Diego at the Spring Knit Conference. And we have a very special guest on today. We have Suzy Koenig and you are with SRK Management Services. Welcome to the program.

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00:58 - 00:59

Suzy Koenig

Thank you. Thank you so much

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00:59 - 01:47

Lucas McCurdy

You have seen a lot. I'm looking at your LinkedIn page right here and even just your headline here. Receiver for healthcare, chapter 11 trustee, healthcare management consultant, president, and you also do ombudsman work. I mean, literally, you are the definition of an overachiever. Is there anything you can't do? You are a very trusted advisor in this space. And, we're here at a big conference. There's a lot of industry heavy hitters. You were even on a panel discussion here. People use you as a big time resource, particularly in the receivership category. But before we dive into all of that, I would love to learn what the genesis of the passion is. How did that start for you that pushed you into this direction? What was the reason for that?

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01:47 - 03:44

Suzy Koenig

Actually. I started and went to university like many of us, and ended up watching General Hospital during the day with my sorority sisters, and I saw this social worker on General Hospital that I thought she knew everything that was going on in the hospitals. And it was 2:00 we all came back to watch that.

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And I thought that it would be kind of cool to do something like that. So I was originally going to go into nursing, but, you know what? It seemed like they were a dime a dozen at the time. Now, obviously there's a nursing shortage, but the social workers seemed important. So I went and got a degree in social work at the University of Illinois and ended up working in nursing homes, which I never thought I would do that. I originally started out in the hospitals, as a case manager, and I couldn't follow the patient.

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The patient left the hospital, and I never knew what happened to the patient. So when most of them went to the nursing homes after that, I decided, you know what? I think that may be a path I want to go to. So I ended up working as a social worker. Then I ended up doing marketing, census development. I became the assistant administrator. I became the administrator, I became the regional director, and then I became an owner. So I did a little bit of everything. And, then I launched my company in about 2000 after I had been there, done that for about 25 years. And I said, you know what? I have a knack for turnarounds. And so everything I ended up being involved in had problems. So somebody had to fix the situations, and that's how I ended up doing it.

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03:34 - 04:26

Josh Crisp

Wow. So that is a lot of history, which here these years later, you've seen so many changes, in the industry, you've seen changes in the acuity and the types of products and housing and services. There's a lot of talk about opportunities in various aspects. So there's a lot of talk about challenges and new developments.

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But one thing we've been hearing a lot is there are going to be some distressed assets in senior housing. There are some, which with those challenges bring opportunities. And I would imagine for your expertise, you're leading in thought on that. So give us some, a little bit of inflection on where you think the industry is and how you're helping operators and owners through those challenges. Particularly in the areas of, like, as you've mentioned, Receiverships.

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04:26 - 07:52

Suzy Koenig

It's really interesting because you're 100% right. There's been a lot of stress. You know, Covid brought on a lot of issues for everyone. No, I don't think anyone was spared during that time. Although I will say we were the busiest we've ever been in many of the facilities all over. But we were opening up Covid units for people.

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So we were traveling all over the country. That's what we were doing. We were actually traveling to hospitals as well because the hospitals didn't even get it and, oftentimes, we were the only ones on the airplanes during Covid. And then so Covid hit everyone and yes, everybody got stimulus payments as you well aware and remember.

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But stimulus stopped in 2001, 2002, and all the operators then had to operate on what they had. But I think a lot of people out in the general population saw nursing homes and just healthcare and totally different chains, and people decided at that point that they were going to age at home, maybe a little bit more and do things like that.

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And so the census has taken a dip. It's not 100% back now since Covid, but it is coming back. But, you know, revenues that that's where it is. But your expenses, there are rates. I know everybody hears about Medicaid rates not being enough. I mean, they don't even cover 80% of the care in many of these states, you know, hospital Medicaid, you know, Medicaid rates. And the issue is that some states have better rates and others and, you know, we all know that. But operators, no matter how well you do, I don't care. You could be the best operator in the world with what's going on with staffing right now, as we all saw, you know, coming out of Covid to people stayed and worked well during Covid because that's what they knew they had to do.

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But afterwards, a lot of people really had second thoughts about what was happening, where things were going, and they didn't want to risk their lives for their families anymore. So many people got out of healthcare. So we go back to this nursing shortage and, you know, we're in facilities, paying nurses and staff to double and triple what they would have paid. And operators have had to ebb and flow and figure out how to fix that. And so we've always, myself and my group have always worked in difficult states where the reimbursement has been difficult. So if you can fix it there, you can fix it anywhere. And so that's really what we've done. We've kind of held it together and we go in with a different outlook.

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You know, we look at things, we're creative, we come up with different ideas. We work with agencies to take out agencies because we have agencies that we respect, that work with us, and they help us to backfill them. But then they don't do it obnoxiously where during Covid, you just had agencies in there like crazy. So it's in their benefit to go in with us as a group and try to help knock out some of the current agency. Although, now, operators are getting smarter and investing more in their staff and trying to figure those things out.

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07:52 - 08:43

Josh Crisp

So, talk to us about a distressed asset. Some of our listeners, that maybe aren't here, don't get to maybe listen to your panels and things like that. That's one of the goals of our podcast. To sort of educate. You have used the term receivership, which I think you might have even kind of invented that term. Can you explain what, like where that comes into play and like how that's what you do to assist through that process.

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Oftentimes, the receiver is court appointed through with the help of secured credit. And the secured creditor is the lender and the landlord is the REIT. Whoever owns the property. Because what happens is the operator at some point can't afford to pay the rent, you know, the lease payment, the rent, whatever it is.

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08:43 - 09:53

Suzy Koenig

And they try to work, the banks or the landlords try to work with the operator and sometimes the operator will just refuse to do it, not wanting to engage with it, and then the lender will go to court. They'll come in, get in touch with us first and ask us to, you know, if we would be happy to do that. And then we put together a receivership order, which we've used and that goes to court and gets court appointed, and we kind of take out the owner. Whoever, like many of the operators, have leases and the operator of the yellow, see, the receiver comes in and operates kind of what work doesn't operate how we do because we bring in the operator.

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But some receivers don't have operators. They have to bring outsourced operators. But they'll, they get the cash, they open up either receivership accounts or the owners have to. To leave because it's a court order kind of kicking the owners out and having the receiver replace the owner.

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09:53 - 10:08

Josh Crisp

You talked a lot about, I think you use the term, resident or patient advocacy and your role in that in, during difficult times and transitions. What's your role in that? And being an advocate.

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10:08 - 11:47

Suzy Koenig

It's a good question because being an advocate in this type of situation, even though a receiver goes in and collects the cash and makes sure that the money is there to pay the rent and to pay all the resources that are necessary. Number one, patient care is above and beyond. So you have to make sure that patient care is still there.

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So what we usually do is we bring in our own management, which is an SAC affiliate, which will come in and oversee the care with the receiver. And that makes for a great transition because the receiver knows exactly what's needed. And the operator or the manager knows what's needed. And we will look at contracts like we can if if you just like bankruptcy you can reject contracts if the contract doesn't make sense and, you can still provide the care and you want to make sure the resident gets the care or if you want to change therapy company, you want to change.

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You know, food, you want to do anything. You can change that out during the receivership without any penalties at that point. But you still try to save finances in the end to be able to pay off your creditors, because that's what a receiver comes in to be more cost aware and, and be able to organize it better and more efficiently. So, you know, you want your creditors to get paid, but initially you have receiver debt where, you know, you can kind of like stall that and not pay that until the end of the receivership.

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11:47 - 12:23

Josh Crisp

So with all the positive, I'd say the, vibe that's at NIC, which we haven't seen in a while, in the last six, eight, maybe even 12 months. There's been a lot of positivity. We feel it, we hear it. We see it here at NIC. There's new dollars flowing into the industry, but we still have some challenges to work through. Where you are in your specialty. What do you see as the opportunities in the challenges that we need to be ready for? And to be able to utilize services like what you offer?

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00:12:23:14 - 00:12:48:18

Suzy Koenig

I think that, lenders and landlords and banks need to be, aware that there's people like us out there and we don't even have to go in and be a receiver that, you know, we come in and help and, some places ask their clients at that point, if they can't pay the bills, they say look, we're going to give you names of 2 or 3 firms that can go in there and really help you.

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12:48 - 14:08

Suzy Koenig

And we'll go in and do an assessment and we'll look at every part of the facility. We'll look at dietary, we'll look at maintenance, repairs, clinical MDS in a skilled nursing facility in assisted living. We'll look at the levels of care. And then we go in and we tweak everything. And we you know, because I've been doing this for many years, many of my people, we don't have new people into the industry.

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They're all people that are very much well experienced, at least 15 to 20 years. And we get right in there with people and we try to work with them right next to them and try to improve the properties. So, you know, it's not just a receivership. We come in and actually turn it around and we teach and train.

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I think the biggest problem that I see in senior housing, in skilled nursing and everything is just people don't have the educational knowledge of what to do. You know, they may have worked in another industry. They may have worked in home health hospitals. They come to senior housing. And it's a completely different animal. And somebody that really knows the business needs to teach and train. And a lot of groups are not able to do that because they may not be big enough to do it, or they may not have the qualified people to do it.

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14:08 - 14:35

Josh Crisp

Well, I see a great opportunity, Lucas, because there is so much excitement. There is so much, I would say, fresh energy, fresh blood from outside the industry coming in. But when you pair that with the knowledge base of what a team like yours brings to the table, I think that's where the real opportunity lies, because we have to have both rights to be able to grow. But what a great opportunity. Lucas, so many challenges, but so many opportunities. Right?

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14:35 - 15:09

Lucas McCurdy

Yes. And it's these types of discussions that are being had. Senior living is complex, and it's a complicated operating platform that really requires a lot of different people to be involved in that. And so final word, Suzy, for let's speak directly to that operator right there that's facing, potential receivership or bankruptcy or some type of a challenge. Give your parting words of encouragement to them, as they're kind of facing something that may be unknown or distressful.

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15:09 - 15:49

Suzy Koenig

Very good points. And I would say to the operator, don't wait. If you're having problems, work with your lender, try to work things out. Don't let it get to the point where neither one of you, you know, are talking to each other, and you have to maybe bring in a receiver, which is, you know, we do that too.

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But it's always nice to try to work these things out ahead of time. You have somebody in there that knows how to project your cash, that understands how to do that. Don't bring in somebody that knows finances, but has never worked with Medicare and Medicaid. You know, have somebody that understands how to do that, work through that, show the lender that you know what you're doing.

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15:49 - 16:26

Suzy Koenig

You know, look at all your supply contracts, make sure you have somebody that can help you with inventory, you know, bring in a group like us that could come in there and really help teach and train. And once they teach and train you, even on the reimbursement side and the Medicare reimbursements, the MDS is a that changes all the time.

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It's hard for facilities to always know what's going on, you know, work with professional people. And, you know, usually nine out of ten times a lender will work with you if you're willing to, to show that you have the, you know, fortitude to do it.

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16:26 - 16:41

Josh Crisp

Well. Great words of wisdom, great encouragement to our listeners, our operators. Suzy, we appreciate the work you've done for years. The value you bring to our industry. What another great interview and opportunity to sit down with a great professional here at NIC.

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16:41 - 17:03

Lucas McCurdy

Wealth and Knowledge. And for those that want to learn more about Suzy and urbanization, you can go to the show notes. Click that link right there, connect with us and make sure you follow the big newsletter. Because each and every Friday we release our newsletter with a variety of different topics and educational content, including the weekly podcast just Like this with Suzy. For those of you that want more content and more access, go to LinkedIn and also btgvoice.com. Thanks for listening to another great episode of Bridge the Gap.

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Outro

Thanks for listening to Bridge the Gap podcast with Josh and Lucas. Connect with the BTG network team and use your voice to influence the industry by connecting with us at btgvoice.com.

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