At the highest level of each organization sit two critical leaders influencing the organization's goals and actions and ensuring everything runs smoothly: the chief executive officer (CEO) and chief financial officer (CFO).
The primary focus of the CEO is to lead their organization to success. CEO activities range from delegating key tasks and responsibilities to driving strategies for improving profitability.
The CFO role is also a top leadership position, focusing on financial operations. The CFO helps ensure an organization's financial health, overseeing all aspects of financial reporting and analysis, financial planning, budgeting, accounting, and taxation. CFOs typically report to CEOs.
A CEO vs. CFO comparison shows that individuals in these roles have similar responsibilities across industries. In healthcare, however, CEOs and CFOs are expected to understand the intricacies of running a healthcare organization, which often include ethical and public health considerations, and to stay updated on healthcare industry trends, regulations and innovations.
CEO vs. CFO: Job Role and Responsibilities
A healthcare CEO ensures operational excellence just like any corporate CEO. The difference is that a hospital CEO does so intending to provide the best-quality care and patient experiences.
CEO is the top leadership position in an organization. Individuals in this role are responsible for setting long-term goals, developing and championing the organizational mission and vision, and establishing the organization's operational structure.
CEOs typically report directly to a board of directors or a similar governing body and lead other C-suite executives, including the CFO.
Healthcare CFOs are focused on setting up the necessary organizational structure to ensure financial performance and success. By ensuring a solid financial standing, CFOs can provide the resources needed to help doctors, nurses and staff ensure optimal patient care delivery. At the same time, they guide these efforts by determining appropriate levels for expenditures, technology and staffing.
Both CEOs and CFOs can work in various healthcare settings, from public and private hospitals and nursing homes to veterans hospitals and outpatient care clinics. Health systems with multiple facilities and large healthcare insurers also need CEOs and CFOs. These two roles often work together, as well as with other C-suite executives, such as the chief operating officer (COO), chief nursing officer (CNO) and chief medical officer (CMO), to ensure the organization can provide effective clinical care. A collegial relationship between these executives helps to ensure overall operational, strategic and organizational success.
CEO vs. CFO: Education and Certification Requirements
There is no single educational path to becoming a CEO or CFO: Individuals pursuing these roles have many options to reach their goals.
The first requirement is earning a bachelor's degree. For CEO candidates, a degree in business or a healthcare-related field can provide foundational skills. Individuals going down the CFO path are better positioned for success if they earn a bachelor's degree in a field such as finance, accounting or business.
An individual looking at CEO vs. CFO roles may also want to consider how work experience in the healthcare industry can position them favorably for leadership roles in healthcare organizations. For example, doctors and other medical professionals can pursue this career path because of their in-depth knowledge of the healthcare industry. However, medical professionals wanting to reach the C-suite at healthcare organizations may benefit from taking business-related coursework.
Experience working as a doctor, nurse or other medical professional can be a key to opening the doors of opportunity in the C-suite. While a medical or clinical background isn’t a requirement, a strong understanding of healthcare is essential. Individuals with no academic healthcare training can build up their healthcare knowledge by starting in lower-level management positions in healthcare, then working their way up the executive ladder.
Individuals can also pursue a master's degree to advance their careers. Options for aspiring CEOs and CFOs include a Master of Business Administration (MBA) with a specialized focus on healthcare, a Master of Health Administration (MHA) and a Master of Public Health (MPH).
Those interested in the CFO role may consider pursuing the Certified Public Accountant (CPA) credential, which demonstrates their expertise and trustworthiness in aspects of financial management.
Other certifications that can help professionals compete for these roles include the Fellow of the American College of Healthcare Executives credential from the American College of Healthcare Executives and the Certified Medical Manager credential offered by the Professional Association of Health Care Office Management. These certifications help individuals demonstrate their competence in managing healthcare organizations.
CEO vs. CFO: Salary and Job Outlook
Comparing compensation (CEO vs. CFO) reveals that both roles typically have at least a six-figure salary. Payscale reports a median annual salary for CEOs of around $156,300 as of June 2022. The median annual salary of CFOs is slightly lower according to Payscale data: around $140,400 as of June 2022. Geographic location plays a role in the salary of CEOs and CFOs. For example, CEOs in New York and Los Angeles typically earn up to 30% more than CEOs in other U.S. regions, according to Payscale. CFOs can also make more in these two major cities — 30% and 25% more, respectively.
Also noteworthy, the top 10 highest-paid CEOs earn well into the hundreds of millions of dollars, according to Fortune. While most CEOs won’t earn that much, the top base salaries currently average around $307,000 a year, according to Payscale data. For CFOs, the highest pay averages around $230,000 a year, according to Payscale.
Further comparison of CEO vs. CFO roles points to a promising job outlook. The U.S. Bureau of Labor Statistics predicts 8% growth from 2020 to 2030 for top executive positions across the board. In the healthcare industry, growth projections suggest a sharp increase in opportunities in the future. The BLS projects roles related to medical and health services managers to grow 32% from 2020 to 2030, a rate of growth that exceeds the average of all occupations (8%).
Pursue a Career as a Healthcare Executive
Determining which role is right for you — CEO vs. CFO — means understanding the differences and similarities in job function and the career and salary opportunities of each. Both roles are critical to the overall success of a hospital or other healthcare facility. Equally important is understanding the type of leadership and competencies that healthcare CEOs and CFOs can provide to meet the primary aim of healthcare organizations: to optimize patient care outcomes.
The combination of experience and an advanced education rooted in leadership, management, strategy and business can play a key role in getting you on the path to executive leadership in the healthcare sector. Learn how the George Washington University’s online Healthcare MBA program can open opportunities for you to pursue an executive-level position in healthcare.
Recommended Reading:
Hospital Finance: Past, Present and Future
Opportunities for Entrepreneurs in Healthcare
Sources:
Community Hospital Corporation, “Top Traits a Community Hospital CFO Needs to Succeed”
Fortune, “The Top 10 Highest Paid CEOs of the Fortune 500”
Indeed, “CFO vs. CEO: What’s the Difference?”
Indeed, “How to Become a Hospital CEO”
Investopedia, “Chief Financial Officer (CFO)”
PAHCOM, Certified Medical Manager | CMM
Payscale, Average Chief Executive Officer (CEO) Salary
Payscale, Average Chief Financial Officer (CFO) Salary
Robert Half, “How to Become a CFO: 5 Steps to Guide Your Career Path”
U.S. Bureau of Labor Statistics, Medical and Health Services Managers