I believe he was making them with Pan Matrix film - a product aimed at the serious amateur market. Yes, this method can produce gorgeous dyes directly from color negs. It had limitations, but cut out all the separation neg steps.
Kodak discontinued the product in the mid/late 80's.
Most commercial dye labs would take a color neg and make a Vericolor print film (basically, a big transparency that you processed in C-41) and then make conventional separation negs. Not the best method, but the most common.