At hospitals and health systems specifically, CEOs are experiencing a high rate of turnover.
Healthcare has dealt with plenty of volatility in recent years, creating fluctuation at the CEO level.
How has that change affected CEO turnover and how does it compare to other industries? Healthcare overall is actually in line with national averages, according to a report by Crist Kolder Associates, though hospitals and health systems as a subset are seeing significant churn.
The research, which measures the turnover of C-suite executives at Fortune 500 and S&P 500 companies, revealed that the average CEO tenure in healthcare is 7.6 years, slightly higher than the average of 7.4 years across all industries.
Healthcare had the fourth-longest average tenure for CEOs, behind financial (9.3 years), technology (9.1 years), and services (8.0 years). Meanwhile, the industries with the shortest average tenure were consumer (6.2 years), industrial (6.1 years), and energy (4.8 years).
In terms of turnover in 2024, the report found only four CEO changes in healthcare through August 1, representing just 7% of turnover across all industries, which averaged 8.8.
Hospital-concentrated turnover
However, the data of Fortune 500 and S&P 500 healthcare companies doesnโt tell the story of most hospitals and health systems.
At those organizations, CEO turnover increased 42% last year with 146 changes recorded, according to a report by Challenger, Gray & Christmas. After starting this year at a similar pace, hospital CEO turnover has somewhat stabilized with 68 exits recorded through July, compared to 100 over the same period in 2023.
There have always been extreme cases of CEOs resigning or being ousted from hospitals after irregularly short stints, but those instances are seemingly happening more often.
Pioneers Memorial Healthcare District in Brawley, California, is one of the latest examples of this trend as the hospital parted ways with CEO Christopher Bjornberg after just seven months.
In some cases, like at Colorado-based Sedgwick County Health Center, the high rate of CEO turnover has made it harder to recruit and hire qualified candidates.
Between retirements, leaders choosing to step down or head elsewhere, and organizations searching for the right guiding hand in a post-pandemic world, hospitals and health systems are expected to continue experiencing much of the CEO upheaval in healthcare.
Jay Asser is the CEO editor for HealthLeaders.
KEY TAKEAWAYS
The average CEO tenure at Fortune 500 and S&P 500 healthcare companies is 7.6 years, right in line with the average of 7.4 years across all industries, research by Crist Kolder Associates shows.
CEO turnover at hospitals and health systems though was up significantly last year and continues to have an unsettling effect at many organizations.