In early February, TransforMED announced that its founding president and CEO, Terry McGeeney had retired. Since TransforMED's formation as an offshoot of the American Academy of Family Physicians in 2007, the company has grown from an initial 16 employees to more than 60 today, and has helped more than 1,200 primary care practices in 40 states make the transition from a fee-for-service model to NCQA Level 3 patient-centered medical home. In a conversation with Senior Editor Chris Anderson, interim President and CEO Bruce Bagley, MD, recently took time to reflect on TransforMED's evolution and how it will operate under health reform.
Q: What would you say is the legacy you have inherited from Terry McGeeney at TransforMED?
A: I believe that the creation of TranforMED beginning in 2007, followed by Terry's ability to grow the business and the brand in a relatively short period of time is nothing short of amazing.
Q: When it was formed, what opportunity had AAFP identified in the market for TransforMED?
A: I think the hope of the Academy was that we would create this opportunity for small practices to interact with TransforMED to help them come along into the patient-centered medical home. But it turns out there was no market there. That not only do small practices not value consultative services, they were so capital-depleted they couldn't afford it. About the time we were discovering this, health plans and multispecialty groups and hospital systems that wanted to fortify their primary care effort began to come to us. All of a sudden, instead of getting contracts for a couple thousand dollars, we were getting contracts for a couple hundred thousand dollars, a million dollars, to transform 40 or 50 practices over a period of three or four years. It was serendipity that we were ready when those organizations noticed the need, and if it weren't for the influx of those resources we probably wouldn't have been able to develop the way we did.
Q: How has TransforMED worked with payers to develop a payment model for this kind of care?
A: From the very beginning, Terry and TransforMEd have insisted that for every single project there had to be a different payment environment. So for every single project we have coaxed, cajoled and coached our clients to come up with some alternative or some supplemental payment, or infrastructure contribution or anything that is different, because if we kept doing it the same way we wouldn't get different results.
Q: Do payers now understand their need to be creative with their contracting?
A: Yes. It was a little over a year ago we saw WellPoint (announce) that they are in the process of transitioning how they pay for primary care. While they didn't have a lot of detail around that, there was clearly a commitment by the leadership to change how they bought primary care services.
Another great example would be CareFirst Blue Cross Blue Shield in the D.C. and greater Virginia market. In the beginning of 2010, they instituted their primary care medical home project where they paid an enhanced fee-for-service, plus an enhanced payment for visits for very sick people at the office, plus a shared savings program - a very unique approach to primary care.
They also did something that I think is very important in terms of thinking about small practices. They allowed physicians to join their program - if five or more physicians would agree to work together and sign a contract with Blue Cross that they would work together as a team. They didn't need to have a contract among them - all they had to say is they would work together as a coverage group. So that was a turning point for how big payers start to think about primary care and, to my understanding, has been very successful.