Out of that acquisition was born Mountain States. That made us a bigger player in Virginia and five hospitals later, we're still there. The one thing early on that helped us turn this into a regional healthcare system and allowed success in bringing these hospitals into our organization is the fact that in 1990 we created the Mountain States Healthcare Network. That was basically a network of formal affiliation relationships that at one point reached somewhere close to 70 hospitals.
As a result we established good relationships with outlying hospitals so when it came time to seek a closer relationship they looked at us first. When I came here, we owned no physician practices, but we have over 400 now. We also own the entity that employs all our ED physicians across the system. We've also built out urgent care, diagnostic centers and we're the only nonprofit home health group in the region.
HLM: You must have felt that size and scale were very important from the outset?
Vonderfecht: You can only take out so much cost and larger systems have an advantage there. My thinking is the ones will be most successful are regional ones, where they have a significant amount of healthcare provided in a very large region, and that are also strongly focused on taking out variation. I see those large regional organizations as having the ability to have more success than national ones that have hospitals everywhere.
HLM: What advice do you have for your successor?
Vonderfecht: We've had a lot of success over a lot of years and we focused in on the elements of that success through strategic planning. They should take plenty of time to get to know the organization and the success it's had. Mountain States needs someone who understands and is supportive of the culture, and who isn't coming in with their own leadership team.
They need to take the time to develop those relationships, and do more listening and learning than talking. This is not a turnaround situation.