HLM: You mentioned how important strategic planning has been to growing the system and preparing for the big changes brought about by the Patient Protection and Affordable Care Act. Could you go into detail about that?
Vonderfecht: About three and a half years ago, we recognized the world was going to be changing dramatically due to the ACA. I'm talking about transformational changes. As a result, we felt we should bring in an outside consulting firm to work with us on strategic planning.
We selected a firm that not only does [strategic] planning for healthcare, but also outside healthcare. Oliver Wyman was who we chose, and they work a lot with Fortune 500 companies.
They helped us come up with a 10-year plan, when we usually do a three-year plan. We developed a vision for where we thought healthcare would be. For instance, we developed a contracting network entity that included all elements of our system and 2,000 physicians.
We used that organization as our innovator and brought in a whole new staff to lead it out of Blue Cross Blue Shield of Tennessee. Those guys have been working to position us to be successful in shared savings contracting and operating our insurance company as well, called Crestpoint Health.
HLM: You also built an ACO, one of the first in the state of Tennessee, right?
Vonderfecht: That was one of the first things we did. We were one of the first five ACOs in Tennessee to be approved by CMS. We've had about 14,000 Medicare lives attributed to shared savings and so far we're seeing good success. We're seeing savings, but we're also being pretty conservative about booking it right now.
HLM: What about developing care models as part of your expected participation in bundled payments?
Vonderfecht: Our care model development piece relies to a large degree on our recent relationship with Vanderbilt [an affiliation agreement that brings evidence-based care models to MSHA)]. We're using those as starting points to refine our care models and get our physicians involved in taking variation out of care.
We also have been involved with the Geisinger/Brandeis innovation model around bundled payments. We have eight that are ready to move forward with the federal government as long as we can have reasonable reimbursement. That is, we're still looking into it.