Richard Rodriguez, M.D., is the chief medical officer for 457-bed Tucson (Ariz.) Medical Center, though a casual observer might not immediately connect his title with his job description.
The chief information officer reports to Rodriguez, who is overseeing the hospital's transition to computerized physician-order entry and an electronic medical-record system. The head of strategic planning reports to him, as well.
Rodriguez is up to his ears in plans for a new replacement facility on the southeast edge of town, an area that has very few physicians. He manages a growing cadre of hospitalists and intensivists employed directly by Tucson Medical, and negotiates agreements with contracted physicians. And he recruits.
"In southern Arizona, it's hard to attract and retain physicians," he says. "We wine them and dine them, help pay for moving, help them set up their practices and market their services. If I weren't here, they'd go to Colorado or California."
And of course, he's responsible for quality measurement and improvement, the area that first attracted him to management. "When you make a diagnosis, patients tell you a story about what's going on in their life," he says. "Different doctors do different things with that information. When I started practicing, I noticed that with the same diagnosis, some patients would be hospitalized for two days and some for 10. That variation caught my interest. I would love to see standardization based on the best evidence, and reduction in that variability."
He practiced full time for nine years as an internist, and gradually began to serve on hospital committees and get more involved in functions like utilization review. By the mid-1990s, his role was completely administrative. "It just snuck up on me," he says.
Rodriguez epitomizes the CMO for the 21st century, a position that's becoming more involved with line responsibilities than ever before, says Kim Mobley, a principal in the Detroit office of compensation consulting firm Sullivan, Cotter and Associates. The firm recently completed its annual survey of healthcare executive compensation.
"CMOs are increasing in visibility and responsibility," she says. "Ten years ago these positions focused on staff relations and credentialing. Now they're part of the executive team. There's more complexity to physician management issues. It used to be a role reserved for people at the end of their career, but not any more."
CMOs are seeing generous raises and a substantial amount of incentive compensation, according to survey figures (See chart). Base salary grew 6.3% from 2004 to 2005 for hospital-based CMOs, and 4.7% for system-based CMOs. Total cash compensation, which also includes performance incentives, increased 6.2% from 2004 to 2005 for hospital CMOs and 7.7% for system CMOs.
Sullivan Cotter has collected CMO compensation data for 13 years. This year's survey was conducted between January and May 2005 among human resources representatives from hospitals and hospital systems. The survey included 60 hospitals and 45 health systems.
CMOs have grown way beyond their traditional role as buffer between the medical staff and hospital administration, and even beyond their newer responsibilities for quality measurement and improvement. "A lot more physician executives are seeking positions with operational responsibility and more involvement in day-to-day activities," says David Kirschman, president of the Physician Executive Management Center, a recruiting firm for physician executives.
Morris Flaum, M.D., has been vice president of medical affairs at 651-bed California Pacific Medical Center, a Sutter Health affiliate in San Francisco, for three years. He has line responsibility for quality measurement and management, medical staff services, community education, the transplantation department and the Physicians' Foundation. He's also involved in planning a replacement facility and creating a neuroscience institute.
The buffer zone
"Being a buffer is a component of my role, but I took this position specifically because it had line-operation responsibility," he says. A hematologist by training, Flaum started getting into administration at the Ochsner Clinic Foundation in New Orleans, and went on to earn an MBA when he realized he had a flair for management.
That buffer role is less necessary now, says Rodney Williams, M.D., CMO of 358-bed Greater Baltimore Medical Center. "When I first started, there was this idea that the administration needed someone just to talk to the doctors. Whatever that barrier was, it seems to have disappeared in large part. Physicians are just as likely to talk to the CEO or the CFO as to me."
Williams detoured from medicine to earn a law degree and practice law as a hospital attorney; he also served the functions of a CMO before the title became widespread.
"When I finished medical school, the CMO position didn't really exist, so I couldn't have thought about it as a goal," he says. "By the time I'd been in private practice for a while, it became clear that this was the way the world was moving."
The malpractice insurance crisis is taking a lot of Williams' attention. "We're under a lot of pressure from our private physicians," he says. "Underlying the whole issue is that they're just not earning the money they used to, and it's very hard for them. In Maryland, physicians are paid at the 22nd percentile nationally, and they know they can move somewhere else and make a lot more money."
Physicians' fortunes are becoming much more intertwined with the hospital's, he adds. "We're going back to more intertwined relationships. In the early 1990s everyone was acquiring groups and forming joint ventures with their physicians, and then that disappeared. Now we're seeing a resurgence."
Phillip Bryant, D.O., the new CMO at Good Shepherd Rehabilitation Network in Allentown, Pa., likes to do logic puzzles. And his new job, like three previous managerial posts, is a doozy. He must restructure pay scales for his physician group to increase its productivity and financial viability, and do hiring, firing and shuffling throughout his organization to put the right people in the right positions.
"Even a good person in a bad system will look bad, so fixing the systems is my priority," he says.
He enjoys pinpointing the problems in the way things are done and figuring out how to fix them.
"If things are not working as efficiently and effectively as they could, it's rewarding to make that change."
Good Shepherd operates a 75-bed freestanding rehabilitation hospital and rehab units in two nearby acute-care hospitals, as well as several outpatient and long-term-care facilities. Bryant has line responsibility for admissions, credentialing and accreditation, business practice, strategic planning for physicians, medical directorships, special programs and centers of excellence, academic affiliations, fellowship programming, quality and patient safety, and care management.
Bryant got his business education on the job rather than in the classroom. "I probably would have learned a little more about finance if I had known I was going to be so involved," he says. "It would have been nice to know about all the different possible business models a little earlier. But I've worked with MBAs who have trouble functioning in this environment, where you have to multitask and work with a lot of different personalities, and understand how to effect change with people who are resistant."
Lonely at the top
Some CMOs manage to keep seeing patients in between meetings and managerial crises, but others don't. Bryant is still trying to figure out the right balance in his new position. "You have to be careful," he says. "If you cover for too many people, you begin to lose the leadership perspective and you can't step back and think. But it's very important to stay clinically adept. I get up very early in the morning to keep up with the literature."
In a consultative specialty like hematology, Flaum found it easier to see patients here and there, before he took over management of the Physicians' Foundation. Now he simply doesn't have time.
"I miss it," he says, and he's recruiting physicians to take some of his managerial load so that he can add more clinical time to his schedule.
Williams of Greater Baltimore Medical Center has bowed out of patient care, though reluctantly.
"There's no such thing as a part-time oncologist," Williams says. "I would sometimes help out in an internal-medicine practice and it would work for a while, but then patients would bond to me and it was just hard. But I miss it terribly."
Rodriguez has also given up practicing, though he credits his earlier career as an internist with his ability to be effective in his current position.
But he misses seeing patients. "Every day I would be told I was wonderful," he says. "In this job, no one tells you you're wonderful."