In a small private practice, clinical governance is informal. It happens in the hallway, the breakroom, or during a quick chat between cases. Partners hold each other accountable through proximity and shared reputation.
In a scaled platform, proximity disappears.
When a practice grows from one location to 10, or adds 20 new providers, “hallway governance” stops working. Without a formal structure for clinical leadership, standards drift and variation increases.
Over time, operational leadership may step into the vacuum and inadvertently make decisions that should remain clinical.
This is why scaled platforms require a Chief Medical Officer (CMO) or formal Clinical Board.
Clinical leadership is what keeps the clinical lane clear as scale increases. Without it, the pressure to standardize operations will eventually erode clinical autonomy.
Why “Everyone Decides” Fails
There's a temptation in early partnerships to maintain a flat structure where “all partners have a say.” While democratic, this often leads to two outcomes in a scaling organization:
Paralysis: Every decision regarding a new device, supply change, or protocol update requires a consensus that's impossible to achieve across multiple sites.
The Operational Override: Because the physicians cannot agree quickly, the operations team makes the decision based on cost or logistics simply to keep the business moving.
To protect clinical authority, it has to be concentrated in a role with the power to decide.
What the Role Actually Does
A functional CMO role is a governance function and the job is to translate clinical reality into organizational standards.
In a healthy MSO partnership, the CMO (or Clinical Board) owns 4 specific areas:
1. Defining Standards vs. Preferences
This is the hardest part of the job. The CMO must distinguish between clinical standards (non-negotiable safety and quality protocols) and physician preferences (personal habits).
Standard: Sterility and safety protocols are non-negotiable.
Preference: When outcomes are equivalent, surgeons may have vendor preferences.
By standardizing the non-negotiables, the CMO allows the MSO to drive efficiency without compromising care.
2. Arbitrating Peer Disputes
When two physicians disagree on a block schedule, referral pattern, or shared resource, operations should not decide the winner. A clinical leader should arbitrate based on clinical merit and fairness.
3. Owning “Quality” Metrics
If the MSO tracks “quality,” they will usually track what is easy to measure: speed, volume, and patient satisfaction scores. The CMO ensures the organization tracks what actually matters: outcomes, complication rates, and safety indicators.
4. The Operational Shield
The CMO sits at the executive table to ensure that financial decisions don't inadvertently break clinical workflows. They're the ones who say, “We cannot reduce that staffing line without revisiting supervision ratios and safety standards.”
Structuring Authority in Writing
For a CMO or Clinical Board to be effective, their authority must be documented in the Joint Operating Agreement or the employment framework.
It should be clear:
Who selects the Clinical Leader? (Ideally, this is a physician-selected role, not an MSO appointee).
What decisions require their sign-off? (e.g., Hiring of new providers, adoption of new clinical technology, changes to clinical SOPs).
What's the escalation path? If the clinical leader says “no” on safety or standards grounds, does that trigger a required pause and clinical review before anything moves forward?
The Checklist: Confirming Clinical Leadership
Physicians joining a platform or evaluating a successor role should look for evidence that clinical leadership is real, not ceremonial. This matters even more for associate and successor physicians, because it determines whether standards are enforced consistently or negotiated physician-by-physician.
1. Is there a written scope for the clinical leader?
Does the org chart show a CMO or Medical Director with a job description, or is it just a title given to the founder?
2. Does the clinical leader have budget authority?
Can they approve training, CME, or safety equipment, or do they have to ask a non-clinical manager for permission?
3. How are disputes resolved?
If a high-producing physician is violating quality standards, does the CMO have the authority to intervene, or does revenue protect the bad behavior?
4. Is there a succession plan for leadership?
Is the current Clinical Leader there for life, or is there a mechanism for new leaders to rotate in? Durable platforms build systems, not just around one personality.
Governance Protects Autonomy
It seems counterintuitive, but structure creates freedom.
By centralizing the defense of clinical standards, the CMO relieves individual physicians from having to fight every operational battle. It allows the practicing doctors to focus on patients, knowing that there's a dedicated role ensuring the system respects their clinical judgment.
Without a strong clinical leader, the system becomes fragile. With one, the clinical and operational sides can bear the weight of scale together.
How Verdira Approaches This
Clinical decisions remain with physicians.
MSO scope is clearly defined in writing and tied to real services.
Governance is clarified before signing so expectations remain stable after close.
We build long-duration platforms and do not operate on forced exits.
If you’re evaluating an MSO partnership or successor role and want to sanity-check structure and expectations, we’re open to thoughtful conversations.
This article is for general educational purposes and is not legal advice.
