What is it?
Most independent medical groups are governed by three decision-making bodies: the board, C-suite, and shareholders. Some medical groups also have a corporate executive team involved in decision-making. Each governing body plays a distinct role in effectively managing day-to-day operations and guiding the group’s strategy.
Board: Independent medical groups are typically governed by a small physician board. The board sets the strategic vision and is responsible for the medical group’s overall success. To do this, they approve the annual budget, monitor performance indicators, oversee the CEO, and vote on major decisions like acquisitions. A shareholder-governed board is unique to independent medical groups. While the CEO may sit on the board, the board chair, often a physician, is a separate role to prevent any overlap between governance and management. The most effective boards are small and highly centralized.
C-suite: The C-suite manages day-to-day operations and executes the strategy set by the board. This includes implementing new initiatives, managing group finances, running practice operations, and engaging staff. The CEO reports directly to the board and is often a health care administrator with a business background. The C-suite at an independent medical group will look very similar to the executive team at other provider organizations, including roles such as chief executive officer, chief operating officer, chief medical officer, chief strategy officer, and chief financial officer.
Shareholders: Shareholders are physicians who own shares in the medical group. In addition to working as doctors, they profit when the group grows and succeeds. Since they are financially invested in the practice, they have a stake in group success. Shareholder power varies by organization, but many independent medical groups restrict shareholder authority to what is legally required. This includes decisions around practice sale or acquisition, bylaws changes, and board member elections. This limited power helps streamline decision-making and ensures that leaders make decisions that are in the best interest of the entire group. Increasingly, independent medical groups are offering employment models for physicians who are not interested in being shareholders.
Corporate: Not every independent medical group will have a corporate leadership team. This model is most common at integrated physician practice entities with a regional or national footprint, such as coalitions, aggregators, and national chains. Corporate leadership sets the overall strategic vision for the business and grows it to scale. While the leadership team often leaves day-to-day operations up to local practices, corporate oversees the medical group’s successful integration and ensures the group is directionally aligned with the larger organization. The corporate leadership team is often made up of representatives from member practices. At more integrated organizations, like aggregators and chains, there may be a separate corporate leadership team.