ACHE: Upheaval in healthcare industry keeps CEO turnover rate high

The churn in hospital CEO positions continues, with turnover in 2016 hitting 18 percent for the third year in a row, according to the American College of Hospital Executives (ACHE).

That's less than the 20 percent turnover of 2013, but is "still among the highest rates reported in the past two decades," ACHE said in an announcement that includes rates for the past 20 years and the turnover rate by state, including the District of Columbia and Puerto Rico.

ACHE President and CEO Deborah Bowen blamed ongoing organizational consolidation, Baby Boomer retirements, internal transfers within healthcare systems and the emergence of new models of care for the high turnover rates. The evidence underscores the need for hospitals to have solid succession plans, she said in the announcement.

Turnover rates have ranged from 16 percent to 20 percent since 2009. The rates between 2001 and 2008, when the Great Recession hit, were typically 14 percent or 15 percent, with a peak of 16 percent in 2004.

The top states in terms of adjusted turnover rates were:

  • Missouri: 30
  • District of Columbia: 29
  • Alaska: 28
  • Nevada: 27
  • Oregon: 26
  • Colorado: 25 (tie)
  • Arizona: 25 (tie)
  • Hawaii: 25 (tie)
  • South Carolina: 24
  • Kansas: 23 (tie)
  • Texas: 23 (tie)

The only states in single digits were Maine (9), Wisconsin (7) and Puerto Rico (2).

As the turnover continues, children's hospitals are battling over leaders experienced in surviving rapid change, even in industries outside healthcare, FierceHealthcare previously reported. That includes other C-suite executives, not just CEOs.

In 2013--the year CEO turnover peaked at 20 percent--hospital human resource professionals predicted in a poll that two-thirds of hospital CEOs hired in 2014 would have a background outside of healthcare, FierceHealthcare reported at the time. It was an ongoing response to emerging business challenges including payment reform and hospital bankruptcies, so hospitals were looking particularly hard for CEOs with experience in venture capital and private equity, finance and accounting, and in banking.

To learn more:
-see the announcement and the rate comparisons
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