1. 16 JANUARY/FEBRUARY n 2015
Careers
CHIEF MEDICAL OFFICER:
CHANGING ROLES AND
SKILL SETS
n Martha Sonnenberg, MD
In this article…
Chief medical officers must acquire many executive leadership skills to lead hospitals
and health systems today.
THERE IS A SEA CHANGE OCCURRING IN
American hospitals and health care organizations. We are
witnessing a radically changing health care environment in
which hospitals and physicians are scrambling for a diminishing
piece of the reimbursement pie, as the fee-for-service model
of reimbursement gives way to the value-based model.
Patients and payers, as well as state and federal govern-
ments, are demanding improved quality and safety, and cost
containment. In this environment, the traditional hospital
organization, as well as organized medical staffs, based as
they are in a traditional autonomous role for physicians, are
struggling to provide and sustain responsible quality and cost-
effective care to patients.
Given the nature of these changes, hospitals and physicians
find it increasingly difficult to function efficiently as separate
entities. Hospitals and physicians need alignment of their goals
to create safe and high-quality care at lower cost. It has fallen
primarily to the chief medical officer (CMO) to forge this alli-
ance, to form a meaningful and operational liaison between
hospital administrators and physicians.
THE CURRENT ROLE OF THE CMO — It is the CMO who must
lead the necessary culture change from that of the autonomous
physician to that of physicians as members of a healthcare team.
The CMO must spearhead physician acceptance of trans-
parent performance improvement metrics and of working in
partnership with nurses and case managers.
The CMO must ensure that physicians take steps to de-
crease variation in practice, leading to compliance with best
practice guidelines and to decrease the overall length of stay
in hospitals. In so doing, the CMO promotes coordination of
patient care throughout the hospital experience and during
the post-discharge phase.
The chief medical officer provides an integrating force
linking all aspects of hospital care:
n Utilization
n Quality and safety
n Credentialing
n Physician practice evaluation (See illustration 1)
This integrating role is required regardless of the type of
organizational model, be it a small community hospital or
large health system. The order of organizational complexity
may change, but the requirement for a unified and integrated
strategic leadership does not. The CMO translates administra-
tive imperatives to the medical staff and provides a clinical
perspective to administrative vision and strategy.
Without a CMO, hospitals are poorly equipped to address
the inherent conflicts between autonomous physicians and
hospital goals. Although much literature has been written to
address how best to leverage the relationship of physicians to
hospital goals, the essence of the issue is that such alignment
requires strong and skilled leadership with the authority to
achieve accountable performance at all levels.1,2,3
Without alignment, hospitals will be vulnerable to com-
petitive forces, and they will struggle to recoup value-based

2. physicianleaders.org 17
reimbursement. This will be increasingly true for smaller
hospitals, which are at much greater competitive risk than
larger institutions.
Indeed, the need for “transformational executives,” includ-
ing CEOs and CMOs, is now recognized in smaller, and even in
rural hospitals. 4
This also holds for larger hospitals with more
complex organizational structures that need integration. Health
care systems moving toward integration and forming account-
able care organizations will need a strong and skillful medical
leadership structure that includes a skilled CMO.
THE CHANGING ROLE OF THE CMO — Historically, the CMO
role was neither well-defined nor critical. The CMO role was
frequently filled by a senior physician, often as a part-time
position, who functioned primarily to influence staff physicians
to perform at higher standards and to accept administrative
policies.
Many of these CMOs were quite skilled in engaging mem-
bers of the medical staff; they were physicians who were
well-liked and respected by their peers, and who were trusted
to represent the medical staff in administrative matters. They
facilitated the work of chiefs of staff and department chairs,
and focused primarily on medical staff issues such as peer
review, credentialing and privileging.
Ultimately, however, even the most skilled were unable to
effect sustainable change in physician behavior and in effect-
ing alignment with hospital goals; they rarely had strategic or
operational responsibility, let alone accountability.5
Over the past 20 years, the CMO role has evolved far
beyond peer review and privileging, to include utilization re-
view, program growth and development, practice acquisition,
integrating health systems, and aligning and coordinating am-
bulatory and inpatient care, technology acquisition and imple-
mentation, process improvement, and regulatory compliance,
among others. 6,7
(See illustration 2)
Increasingly, the CMO position is full time. The current
CMO’s success and authority lies in accountability for out-
comes to the CEO, the governing board or other stakehold-
ers.8
The CMO must demonstrate an ability to deliver with
respect to engaging and aligning medical staff, improving
performance metrics, improving quality of care and at the
same time curtailing costs by more efficient use of resources.
In order to meet the requirements of accountability, today’s
CMO must have a skill set that has also evolved.
THE CHANGING SKILL SET REQUIRED OF THE CMO — Yes-
terday’s CMO got by with an engaging personality and a
sense of camaraderie with his or her peers. Today’s CMO is
If the organization has a chief medi-
cal informatics officer (CMIO), the
CMO must work with him or her to
institute electronic medical records
(EMR) and computerized physician
order entry (CPOE) systems that ac-
tually work, are user-friendly and
facilitate meaningful communica-
tion of medical information.

3. 18 JANUARY/FEBRUARY n 2015
encouraged to obtain degrees in business and management,
or certification from various colleges that have developed
to support and train physician leaders. CMO competency is
required in multiple areas:
1. Understanding organizational structure and
function — Above all, the CMO needs a clear
understanding of how his or her organization func-
tions currently, and how it may evolve. The CMO
should be able to assess where integration is needed
to break down clinical or administrative silos, and
whether current clinical leadership is adequate to
the tasks required. The CMO must be willing to
recommend and make necessary changes to improve
functioning of the organization.
The CMO should be comfortable with all the moving
parts of the organization; he or she must know when
and how to align different constituencies within the
organizational setting.9
The CMO must be able to bridge institutional silos
to achieve results and align operations with clinical
effectiveness. CMO partnerships with the chief nurs-
ing officer, a vice president of care management, a
chief operating officer, and a chief financial officer
to get outcomes results, manage projects, develop
programs, or execute plans often will be necessary.
Similarly, the CMO may need to work with other C-Suite
physicians leaders, e.g. chief information officer, chief
strategy officer, chief marketing officer, or CMOs of
regional or affiliated organizations.
The CMO must work with the executive administra-
tive team to develop strategies of sustainability and
market success. When the organization is involved in
mergers, consolidations or systems integrations, the
structural complexity is ratcheted up, and the CMO
must be able to work with that additional complexity;
the CMO’s involvement will be critical in strategizing a
health care system’s successdul transition to population
health management. (See Illustration 3)
2. Promoting Leadership — The CMO should provide
support for current medical leadership and have the
ability to identify and nurture future leaders to ensure
sustainable delivery of quality care by the organization.1,3
Many current medical staff leaders have no leader-
ship training — including such basics as how to chair
a meeting effectively. The CMO can provide coaching
and mentoring, and champion improved communica-
tion among medical leaders.
The CMO must be able to show the administration
that investment in leadership development is neces-
sary for the organization’s ongoing ability to provide
quality care as well as to grow and meet competitive
challenges in a sustainable manner.
ILLUSTRATION 1
THE CMO PROVIDES AN INTEGRATING FORCE, LINKING ALL ASPECTS OF HOSPITAL CARE
CMO
Role
in
Organizational
Structure
CEO
CMO
Utilization
LOS
POC
PA
Resource
use
Quality
and
Safety
Peer
Review
Credentialing
OPPE
Executive
Admin:
COO
CFO,
CNO,
CMIO
VP
Care
Coord
CQO
Medical
Leadership:
MEC/COS
Care
Centers
Department
Chairs
Medical
Staff

4. physicianleaders.org 19
ILLUSTRATION 2
THE CMO ROLE HAS EXPANDED OVER THE PAST 20 YEARS.
ILLUSTRATION 3
CMO ROLE IN CLINICALLY INTEGRATED ORGANIZATIONAL CONTEXT
In the clinically integrated organization, the CMO must be able
to interact with other chief executive leaders, as well as possibly
multiple regional CMOs, and strategically direct the integration of
ambulatory care, in-patient care, and post-acute care, as well as
directing the medical staff leadership at multiple sites.
Chief
Medical
Officer
(CMO)
Chief
Exec
Officer
Liason
with
medical
staff
Quality
and
Safety
Management
Utilization
and
operations
Strategic
Planning
and
Development
• Bridges
the
physician-­‐
management
gap
• Leadership
development
• Support
of
current
medical
leadership
• Supports
and
assists
in
implementation
of
integration
and
coordination
of
departments,
care
centers
• Facilitation
of
communication
among/
between
medical
leaders
• Oversight
of
Peer
Review,
Credentialing,
OPPE
• Aligns
the
business
and
clinical
objectives
of
physicians
and
the
organization
• Medical
education
based
on
gaps
in
clinical
effectiveness;
compliance
with
Best
Practice
Guidelines
• Communicates
with
Quality
and
Safety
Officers,
to
assure
an
integrated
approach
• Participates,
initiates
Quality
and
Safety
plan,
system
wide
• Assists
in
Performance
Improvement
metrics,
both
at
system
and
practitioner
level
• Works
with
CIO
to
assure
effective
data
collection
and
reporting
systems
for
continuous
performance
improvement
• Assists
in
developing
and
monitoring
practice
patterns
for
physicians
• Champions
Patient
Centered
Care
• Promotes
CPOE
and
Evidence
Based
Practice
• Chair
of
Utilization
Review
Committee
• Oversight
of
Physician
Advisors
to
UR
and
Case
Management
• Champions
physician
partnership
with
nursing
and
Case
Management
• Promotes
and
oversees
efforts
to
reduce
LOS
• Promotes
and
facilitates
coordination
of
care
and
progression
of
care
• Promotes
effective
use
of
resources
• Promotes
coordination
of
care
across
the
system
• Works
with
Executive
management
team
to
build
sustainable
organizational
improvement
• Involved
in
marketing
to
new
physicians
• Participates
in
the
evaluation
of
new
clinical
services
• Strategy
for
population
health
management
• Informs
management
of
trends
and
problems
in
quality,
safety
and
care
coordination
• Assures
a
clinical
voice
in
management
decisions
• Participates
in
key
organizational
strategy
discussions
CMO
Role
in
Clinically
Integrated
Organizational
Context
CEO
CMO
Utilization
LOS
POC
PA
Resource
use
Quality
and
Safety
Peer
Review
Credentialing
OPPE
Executive
Admin.
Medical
Leadership:
Hospital
(s)
A,B,C...
Post-­‐Acute
Care
A,B,C...
CMIO CSO
Regional
Chief
Medical
Officers
A,B,C...
CQO
Population
Health
Management
Ambulatory
Care
A,B,C...

5. 20 JANUARY/FEBRUARY n 2015
3. Facility with IT and analytics — The CMO must
have a strong working understanding of metrics and
medical analytics. Metrics are the vehicle for trans-
forming organizational vision into reality, and are the
most effective form of organizational communication.
Metrics are critically important to the functioning of a
meaningful ongoing professional practice evaluation
(OPPE) process.
A CMO must ensure that data and metrics are accurate,
current, well-defined and relevant. If the organization
has a chief medical informatics officer (CMIO), the two
must work together to institute electronic medical re-
cords (EMR) and computerized physician order entry
(CPOE) systems that actually work, are user-friendly,
and facilitate meaningful communication of medical
information.
A CMO/CMIO alliance is powerful and can more suc-
cessfully get important resources from administration
to support performance improvement, quality and
safety efforts, and the necessary IT infrastructure for
population health management.
THE CMO NEEDS A GOOD
UNDERSTANDING OF PHYSICIAN
COMPENSATION PROCESSES,
PRODUCTIVITY INCENTIVE
PACKAGES AND THE CONCEPT OF
FAIR MARKET VALUE.
4. Understanding the Importance of Accurate Clini-
cal Documentation — The CMO must have a clear
understanding of the importance of accurate clinical
documentation within patient medical records. Accu-
rate documentation, along with a utilization review
process, is a condition of participation for CMS reim-
bursement to hospitals.
Understanding the relationship of physician documen-
tation to final coding of the patient’s diagnoses upon
discharge increases the ability of hospitals to be ap-
propriately reimbursed for the services provided.
The CMO can steward clinical documentation improve-
ment processes in hospitals, oversee a clinical docu-
mentation physician adviser and institute a physician
query process to assist physicans in providing accurate
documentation; this process will ultimately be a part
of an effective EHR program.
5. Business, Marketing and Legal intelligence —
Hospitals and other health care organizations are in-
creasingly vulnerable to a number of federal and state
regulations that, if violated, can have serious civil or
even criminal repercussions.
The CMO needs a good understanding of the physician
compensation processes, productivity incentive pack-
ages and the concept of fair-market value, both for in-
dependent and employed physicians and for individuals
and groups.
This can have significant legal implications — the CMO
should be knowledgeable about the Stark laws, or vari-
ous state law equivalents, prohibiting physician referrals
to entities (labs, procedures, consultants ) with which
they have a financial relationship.
The CMO should be familiar with the federal anti-kick-
back statute and the dangers of placing hospitals and
health care organizations at risk when assigning medical
directorships, discounted office space and complex joint
ventures that may appear to remunerate physicians, or
groups of physicians, for referrals to the organization. 10,
11, 12
These risks are of particular importance as account-
able care organizations become more prominent.13, 14
Similarly, the CMO must be attuned to other legal land-
mines with regard to the Health Insurance Portability
and Accountability Act (HIPAA), the Health Care Quality
Improvement Act (HCQIA), 15
vulnerability to Recovery
Auditor Contracts (RAC) and avoidance of practices
that could invoke fraud and abuse enforcement (billing
for services that do not meet medical necessity criteria
on over billing for services).
Vigilant CMOs can save their organizations from costly
fines and legal consequences if they are able to alert
the administration when practices appear legally ques-
tionable, or might trigger audits.
The CMO can also provide the organization important
clinical perspectives on financial decision making with
regard to clinical department budgets, purchases of
technology or equipment, the acquisition of group
practices and other investment opportunities.
6. Managing Culture Change — As health care institu-
tions and hospitals respond to the changing economic
environment, enormous cultural changes are required.
For physicians this means the transition from the tradi-
tional role of autonomous practitioner in a physician-
centered system, to becoming a member of a health
care team that focuses on the coordination of care in
a patient-centered system.
Physicians must make the transition, in their decision-
making process, from relative independence to com-
pliance with order sets, best practice guidelines and
evidence-based medicine.
The CMO, as the liaison between medical staff and the
organization as a whole, must be able to spearhead
necessary culture changes. This requires significant con-
ceptual and interpersonal and communication skills; the
CMO must frequently act as a champion of new pat-

6. physicianleaders.org 21
terns of physician behavior and lead physicians through
change.
This is not an easy task and is one that requires cour-
age and confidence as well as patience, persuasion and
perserverence along with a robust diplomatic acumen.16
These are not insignificant skills; trying to effect change
with too heavy a hand can backfire and cost the CMO
credibility. The CMO must be able to use his or her
power of influence, not to force, but to leverage physi-
cians’ capacity for change.
7. Engagement and Alignment of Physicians —
A necessary part of culture change is the engagement
and alignment of physicians with the organizational
goals. Without the active participation of physicians,
including independents, employed, hospitalists, spe-
cialists and groups, in providing safe, quality and cost-
effective care to patients, the contemporary health care
organization cannot succeed.
Consequently, the ability to engage and align physicians
to implement the goals of the organization is probably
the most important, and possibly the most difficult,
work the CMO can do.
The CMO often must overcome a history of negative
and dysfunctional relationships among physicians, and
between physicians and administration. Knowledge,
sensitivity and understanding of organizational history
will be important in moving beyond dysfunction to
engagement.
The key skill is the CMO’s ability to gain the trust of the
various participants, to demonstrate honesty in com-
munication and integrity in interactions. The CMO’s
position alone will not engage physicians, nor will lik-
ability or popularity suffice. This task requires that the
CMO be able to leverage influence into changed physi-
cian behavior demonstrated by improved performance
metrics.1
Further, once physicians are engaged, and they are
committed to performing their jobs well, they still must
be aligned with organizational goals. Alignment, be-
yond engagement allows people to work together to
maximize organizational success.8
Alignment of physi-
cians, and indeed of all employees, is what ultimately
allows the organization to realize its strategic vision
and move forward in a sustainable manner.
The CMO is, ultimately, like the orchestra conductor: With-
out that role, we may have many expert performers, and a
beautifully written score, but we do not have the symphonic
music that delights the listener.
The CMO’s role is no longer a luxury, but a necessity for
the successful functioning of today’s hospitals and health care
organizations. n
Martha Sonnenberg, MD, MS, is former CMO
of Brotman Medical Center in Culver City,
Calif., and currently works as an independent
consultant in areas of physician leadership,
physician alignment, and quality and safety.
SbergMD@aol.com
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