Money man of medicine

  • By Kurt Batdorf HBJ Editor
  • Thursday, March 28, 2013 8:45am

EVERETT — These are interesting times to be in health care if you talk to Jerry Tillinger for a couple of hours.

The chief executive of Western Washington Medical Group is guiding the practice through a period of growth in Snohomish County while the health care industry itself faces tremendous change as a result of the Affordable Care Act, President Barack Obama’s signature bill.

Tillinger said he appreciates the good intentions of the Affordable Care Act and even President Bill Clinton’s failed 1993 health-care reform attempt, but he predicts the ACA’s flaws and contract obligations for expanded coverage will make health insurance far more expensive for consumers than its backers imagined.

Tillinger spends most of his time focusing on money issues, the unseen nuts and bolts of the business that let WWMG’s medical professionals focus on the care of their patients.

In that way, Western Washington Medical Group operates like Disneyland, Tillinger said. Up above, patients see their doctors and nurses — the rides and characters. He runs everything patients don’t see.

“This job is like being mayor of an underground city,” he said. “My job here is to make the providers as successful as possible. They shouldn’t be trapped in interminable meetings.”

WWMG traces its roots to 1993. Tillinger arrived in 2009 when its shareholders realized the health-care market was changing rapidly and they needed to change with it if they wanted to succeed. He said WWMG was operating on a “1990s business model” and hadn’t taken advantage of cost savings, such as centralized billing for its individual clinics.

“I understand that physicians are also a business,” he said.

Tillinger recognizes that doctors and nurses are special since they must have an “awe-inspiring” instinct to care for complete strangers. His father was a psychiatrist who once talked a suicidal patient off a bridge, but Tillinger said he never had an interest in becoming a physician himself.

Instead, he earned a bachelor’s degree in English literature at Emory University in Atlanta and a master’s degree in business from Georgia State University.

His first hospital management jobs in Georgia laid the foundation of Tillinger’s current business philosophy: Manage finances so doctors can succeed.

He was working at the Georgia Eye Institute when it imposed a hiring freeze. One of its remote clinics lost its receptionist, but it was too far away to send a replacement from the main clinic. While that three-person outpost referred more than $1 million in surgical business, Tillinger said he had to spend 30 minutes explaining to the institute’s director why it was critical to fill a position that paid less than $8 an hour in order to keep the institute’s bottom line healthy.

Administrative jobs in Virginia and with Physicians Anesthesia Group, a group that provides all anesthesia services to Swedish Medical Center in Seattle and others, further honed Tillinger’s skills at finding operational efficiencies, but that left him with the desire for more variety on the job.

Western Washington Medical Group, he said, “has not disappointed.”

When Tillinger took charge of WWMG, its professional relationship with Providence Regional Medical Center Everett already “was starting to fray” as the hospital hired specialists in direct competition with WWMG.

“That put the group in a real quandary,” Tillinger said: Either do what Providence wanted or make a break to develop new partnerships with local primary-care doctors.

WWMG’s move to develop more partnerships has been more successful than expected, he said. The group had five primary-care physicians in 2010, the year it added its first new practice. Now WWMG has more than 20 primary-care doctors and specialists in 19 categories.

WWMG operates from 19 offices in Snohomish County, Anacortes and Oak Harbor. Whitehorse Family Medicine in Arlington will join WWMG in May, Tillinger said, and it’s in active discussions with other practices to join the growing group.

That’s not to say all is rosy.

As the group’s finance guy, Tillinger constantly works to strike the balance that allows his doctors to perform best medical practices on their patients while making enough money to keep WWMG in business and looking into the future.

Finding that balance, much less keeping it, isn’t easy. Consider the challenges that Tillinger faces.

Medicare recently slashed its reimbursements for specialist procedures at clinics but not for hospitals, making it difficult to retain staff lured by the higher pay a hospital can offer thanks to its more lucrative reimbursements.

While the merger between Providence Regional Medical Center Everett and Swedish Medical Center may have been good for them, Tillinger said it does little to control costs and the lack of competition between the county’s two biggest hospitals doesn’t help consumers.

He shared the story of a mother and daughter who had identical medical procedures. One had it done in the clinic, the other had it done at the hospital because the day she requested her surgery was the day the doctor worked at the hospital. The quality of care was equal in both cases, but the procedure at the hospital was more expensive simply because of the day of the operation, he said.

“That means nothing to that mother who had to shuck out that extra 600 bucks” to cover her share of insurance, Tillinger said.

Still, he doesn’t knock America’s health-care system. The big problem, Tillinger says, is that the country hasn’t reached any consensus on whether health care is a right for all or a service everyone needs to buy.

“This country has the best quality health care in the world,” Tillinger said. “But it’s extremely expensive. That’s the dilemma the country has yet to face.”

Tillinger would love to tell WWMG patients how much a procedure will cost, but most health insurers have clauses that forbid any release of pricing information. And even there, he said, the same insurer likely offers different payment rates for the same procedure depending on the size of the health-care organization it has under contract.

“That veil needs to come down,” Tillinger said. “Contracting has resulted in a huge disparity in reimbursements.”

Patients on state Department of Social and Health Services insurance cost WWMG money since the reimbursement rate is so low, Tillinger said. Medicaid reimbursement rates mean the doctor essentially donates his or her care on that patient.

“Too much (compassionate care) will result in bankruptcy,” Tillinger said. “Going bankrupt is not a service to the community.”

Even end-of-life decisions need to be part of the health-care conversation as the population ages and requires more medical intervention that costs a lot for what it returns in quality of life or longevity.

“There’s no easy answer to this kind of problem,” Tillinger said.

He said patients need to get engaged on the cost of their care and act in their own self-interest. Tillinger cited two online medical pricing resources: and Compass Professional Health Services. Healthcare Blue Book offers free pricing guidance based on ZIP codes while Compass charges a subscription fee for price data.

Even if educated health-care consumers can’t do much immediately to change the cost of their care, their expanding knowledge and interest “would change the paradigm,” he said.

“We’ve got to get people to care about cost,” Tillinger said. “We’re continually looking at ways to save patients money.”

Kurt Batdorf: 425-339-3102;

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