The days are long gone when the Chief Medical Officer (CMO) was serving primarily as a liaison to the medical staff and occupied mainly with medical staff governance issues. While this is still an important component of the role, progressive organizations realize that if they are to adapt successfully to emerging strategic trends in the health care landscape, physician executives need to be involved in the core processes that drive the success of the organization.
Working with the CEOs and executives in some of the most progressive and successful organizations in the country, we have been hearing that the following 3 areas are central to the new role of the health system CMO:
Managing the Clinical Value Proposition
More than ever, success in the current strategic landscape requires that health systems are able to deliver better outcomes at lower price points, all while managing patient experience effectively. In order to maintain healthy margins in environments increasingly dependent on value-based performance, and to ultimately remain a “provider of choice” from a cost perspective, effective cost and outcome management is essential. The ability to do so requires CMOs to manage clinical performance in a way that drives value in these domains.
To do this well, CMOs need to be adept at creating more effective organizational structures to drive performance, beyond being the individual subject matter expert and contributor in the C-suite. In addition, relying on the traditional medical staff governance structure alone has proven to be an unwieldy approach that tends to underperform other approaches. The CMO is uniquely positioned to understand the work ahead, to organize the appropriate structures to take action, and to provide the necessary support for these committees and work groups. Operationally and strategically-focused multi-disciplinary committees, such as those that typically lead service lines or clinical operational councils are two of examples of such structures.
Beyond creating these new, dynamic structures, the CMO plays the role of facilitator of the process – ensuring that the appropriate data and analytics resources are available along with the skills to interpret them; establishing norms that begin with a shared purpose; and ensuring healthy group dynamics. Focusing on providing the appropriate training, coaching, and mentoring to ensure that these groups are successful in meeting their objectives in a sustainable way is a powerful way for CMOs to distribute their leadership impact.
CEOs are asking CMOs to work more closely with their operator colleagues to manage costs most effectively. Perhaps one of the most important areas for this involves new dyad partnerships that are emerging to manage clinical supply chain costs more effectively. Again, creating the right committee or council structures; providing appropriate orientation, training, and support for participants; and engaging physicians around a common purpose are critical success factors. Partnering with administrative supply chain leadership to foster physicians’ psychological ownership of the process, when done effectively, can be a rewarding process that delivers better outcomes, lower costs, all while enhancing physician engagement.
In addition to supply chain leadership, continued reliance on the CMO to organize physician leaders to support throughput, efficiency, and other expense opportunities is a trait we see among CEOs of high-performing health systems.
Involvement in Clinical Strategy
The CMO is in a unique position, as a clinical executive, to be an architect of the overall clinical value proposition. While there’s value in looking at the design and optimization of profitable clinical services in isolation, the CMO is in the position of being able to understand the overall portfolio, how they interact, where there’s waste, and how activities in one impact others and the overall value proposition for the organization. For this reason, we’re hearing from CEOs an increasing desire for closer collaboration between the CMO and the Chief Strategy Officer.
As part of this relationship, the CMO is being asked to become involved in identifying potential new partners, managing external relationships, managing key external groups for engagement and performance, and creating new venues for participative management around value.
Rationalization around number and location of services to ensure both sufficient volume to drive high levels of clinical performance and to minimize cost and footprint is another area where we see CEOs asking for greater CMO engagement.
CEOs are realizing that there are new areas for CMO involvement as it relates to the things that keep them up at night. At the same time, the role of clinical leadership is evolving rapidly, and this presents an opportunity for the Chief Medical Officer to deliver transformational value. For the CMO, understanding the new skills required and proactively creating a personal development plan around these new core competencies will set the stage for success.
About the Author
Dr. Manoj Pawar is a senior physician executive with over 20 years of healthcare and executive leadership experience. Dr. Pawar’s passion is helping healthcare organizations understand and adapt to emerging systems of care and evolving economic models to cultivate organizational success clinically, strategically, operationally, and financially. Read more.