Through the first four months of the year, the number of chief executive departures has risen substantially, according to a new report.
Top executives in all businesses are stepping away at a much higher pace than in previous years, and that’s being seen at hospitals as well.
From January through April 2022, 518 chief executive officers have left their positions, according to a new report by Challenger, Gray & Christmas, Inc., a business coaching and outplacement firm.
That’s the highest total from January through April since the firm began tracking CEO exits in 2002. It’s an 18% uptick from the same four-month period in 2021.
Through April, 36 hospital CEOs have left their posts, up from 20 chief executive departures over the first four months of last year. That represents an 80% increase.
Among pharmaceutical companies, 10 chief executives have left between January and April 2022, compared to just three in the same period a year ago.
Leaders at healthcare companies were a little more likely to stay in their posts than a year ago, according to the report. Through April, 46 healthcare CEOs exited their positions, compared to 63 in the same span of 2021.
Andrew Challenger, senior vice president of Challenger, Gray & Christmas, Inc., said companies are making changes in their top leadership posts for a host of reasons.
“Inflation, staffing shortages, and possible recession concerns are giving more cause for companies to reevaluate leadership,” Challenger said in a statement accompanying the report.
“This, after years of companies trying to figure out the right formula to attract and retain talent and create a culture of inclusion, issues that often start at the top,” he added.
Some top hospital leaders are taking positions elsewhere.
Wright L. Lassiter III, CEO of Henry Ford Health since 2016, is leaving his post to take over as the next chief executive of CommonSpirit, beginning Aug. 1. “I’m honored to have the opportunity to lead this organization, which is a driving force for access to high-quality, essential services for all,” he said in a statement.
Some, like Paul Rothman, CEO of Johns Hopkins Medicine, have announced plans to retire. Rothman, who has led Johns Hopkins Medicine for 10 years, plans to step down July 1.
“A decade felt like the right time horizon to help advance the missions of JHM,” Rothman said in a statement. “That vision was crystallized by the COVID-19 pandemic, which demanded so much of our institution and our community. Two years later, I believe that we have navigated the worst of the pandemic, and it is time for a new leader to guide us forward.”
Last week, James Fanale, president and CEO of the Care New England Health System, said he will retire in early 2023. After his retirement as chief executive, Fanale plans to stay on in a consulting role.
The CEO exit report found 150 chief executives took other roles within the company, such as an adviser or chair, while 122 top executives have opted to retire, and 36 left for new opportunities. In 97 cases, no reason was listed for the exit, the report stated.
Through April, a little more than a quarter (26%) of the incoming CEOs are women, up from 22% in the first four months of 2021.
Hospital CEOs certainly have faced no shortage of challenges over the past two years in dealing with the COVID-19 pandemic.
Health system leaders said they have faced staff shortages, as some healthcare workers have left their jobs in the pandemic. Some healthcare systems continue to struggle financially due to higher labor and supply costs, as well as inconsistent volume since the pandemic began in 2020.
Earlier this year, a survey of healthcare executives identified costs as their top concern this year.