This week we met with a health system chief clinical officer who sought guidance on physician leadership structures: “We have more ‘closely aligned’ doctors than ever, but I feel like we’re really short on physician leaders to organize our medical staff around important goals and move them forward.” It’s a common concern.
One medical group president lamented the loss of connection between doctors as their group grew rapidly: “Our medical group has almost doubled in size in the past five years. When we had 300 providers, I knew every one, and they all felt like they could come to me directly. We just passed 1,000, and there’s no way I can know a thousand people, let alone have a personal relationship with them.”
As networks have grown, executives have shared their need to develop a new “middle layer of physician leaders”, who can build personal connections with frontline doctors. But for this middle layer to work, they stress, these leaders must be tightly connected with the executives who run the group and the health system and carry real decision-making authority: “Real respect is critical, and it won’t happen if they feel like a mouthpiece.”
There was also debate about the right candidate for the job, in particular, the need to have younger physicians, who can relate directly to the needs of their peers, in leadership roles: “It took us a while to realize that the profile of our traditional medical staff leader, an older doctor nearing retirement, wasn’t working when we’re looking to lead a ‘majority millennial’ medical group.”
Regardless, every medical group agreed that they needed to identify and train more leaders, and create roles to bring them into leadership earlier in their careers. But many questions remain about how to design leadership roles. How many frontline providers can a leader work with? How should leadership structures span employed and aligned independent doctors? And how should leaders weigh same-specialty alignment versus cross-specialty collaboration? If you are thinking through these issues, we’d love to hear from you about what is working, and what challenges have emerged.
A consultant colleague recently recounted a call from a health system looking for support in physician alignment. He mused, “It’s never a good sign when I hear that the medical group reports to the system CFO [chief financial officer].” We agree. It’s not that CFOs are necessarily bad managers of physician networks, or aren’t collaborative with doctors—as you’d expect from any group of leaders, there are CFOs who excel at these capabilities, and ones that don’t.
The reporting relationship reveals less about the individual executive, and more about how the system views its medical group: less as a strategic partner, and more as “an asset to feed the [hospital] mothership.” Or worse, as a high-cost asset that is underperforming, with the CFO brought in as a “fixer”, taking over management of the physician group to “stop the bleed.”
Ideally the medical group would be led by a senior physician leader, often with the title of chief clinical officer or chief physician executive, who has oversight of all of the system’s physician network relationships, and can coordinate work across all these entities, sitting at the highest level of the executive team, reporting to the CEO. Of course, these kinds of physician leaders—with executive presence, management acumen, respected by physician and executive peers—can be difficult to find.
Having a respected physician leader at the helm is even more important in a time of crisis, whether they lead alone or are paired with the CFO or another executive. Systems should have a plan to build the leadership talent needed to guide doctors through the coming clinical, generational, and strategic shifts in practice.
It feels like a precarious moment in health systems’ relationships with their doctors. The pandemic has accelerated market forces already at play: mounting burnout, the retirement of Baby Boomer doctors, pressure to grow virtual care, and competition from well-funded insurers, investors and disruptors looking to build their own clinical workforces.
Many health systems have focused system strategy around deepening consumer relationships and loyalty, and quite often we’re told that physicians are roadblocks to consumer-centric offerings (problematic since doctors hold the deepest relationships with a health system’s patients).
When debriefing with a CEO after a health system board meeting, we pointed out the contrast between the strategic level of discussion of most of the meeting with the more granular dialogue around physicians, which focused on the response to a private equity overture to a local, nine-doctor orthopedics practice. It struck us that if this level of scrutiny was applied to other areas, the board would be weighing in on menu changes in food services or selecting throughput metrics for hospital operating rooms.
The CEO acknowledged that while he and a small group of physician leaders have tried to focus on a long-term physician network strategy, “it has been impossible to move beyond putting out the ‘fire of the week’—when it comes to doctors, things that should be small decisions rise to crisis level, and that makes it impossible to play the long game.”
It’s obviouswhy this happens: decisions involving a small number of doctors can have big implications for short-term, fee-for-service profits, and for the personal incomes of the physicians involved. But if health systems are to achieve ambitious goals, they must find a way to play the long game with their doctors, enfranchising them as partners in creating strategy, and making (and following through on) tough decisions. If physician and system leaders don’t have the fortitude to do this, they’ll continue to find that doctors are a roadblock to transformation.
We recently got a call from a health system board chair seeking our perspective on the system’s ongoing search for a new CEO. At the top of his list: trying to understand how important it will be for the next CEO to be a physician. “We’ve never had a doctor in the role,” he mused. “But now we employ hundreds of doctors. And you’d have to imagine that having a physician as CEO would help with physician alignment.”
While choosing a physician CEO brings great signal value to the medical staff, we cautioned that it’s far from a panacea.
Of course, there are advantages in having walked in a frontline clinician’s shoes, being able to personally identify with their challenges and speak their language. But over the years, working with hundreds of health system CEOs, we’ve found that the most important characteristic of a CEO who will advance physician strategy is the desire to form strong personal relationships with doctors and draw on their counsel.
Does the CEO build a “kitchen cabinet” of physician leaders whom he can consult? Are physicians viewed as something to be managed, a problem to solve, or seen as true partners in strategy? Even more simply, does she like spending time with physicians, or groan every time a meeting with doctors pops up on the calendar? We’ve seen many non-physician CEOs excel at building strong, strategic ties with doctors, and some physician executives, who become jaded by never-ending physician alignment struggles, fail to advance partnerships with their colleagues.
One retiring physician CEO, reflecting on his replacement by a nonclinical executive, summed it up well: “I have a feeling he’ll do well with our doctors. He counts several physicians among his closest friends, which is a great sign.”