Vanderbilt University has named Philip Hertik as chief executive officer of its managed-care plans. Hertik, who had been co-chairman of the board of the managed-care business, called Vanderbilt Health Plans, also hopes to purchase the plans from the university early next year.
Hertik replaces James Geraughty, M.D., who left the company. Hertik declined to comment on Geraughty's departure in mid-November.
"It's a step that enables me to get closer to the operations of the company and a step along the path ultimately to accomplishing the management buyout," Hertik said.
Vanderbilt, which operates 576-bed Vanderbilt University Medical Center in Nashville, announced earlier this year that it wanted to exit its money-losing managed-care business, and Hertik and Michael Bailey, the plans' executive vice president and chief operating officer, had expressed an interest in buying them (Aug. 30, p. 8).
Hertik said he hopes to complete the deal in the first quarter next year.
The three HMOs are VHP Community Care, which serves about 12,000 Medicaid recipients under Tennessee's TennCare Medicaid managed-care program, a 50,000-enrollee commercial insurance plan called Health 1-2-3, and a 14,000-enrollee Medicare plan, Health 1-2-3 Platinum.
The health plans lost $25.7 million on revenues of about $139 million in 1998. Hertik estimated the plans' cumulative losses would be $11 million to $12 million for 1999.