I run the healthcare practice for ISG-Americas, an executive search firm operating across more than fifty countries. My work is permanent and interim leadership for hospitals, health systems, physician groups, behavioral health and post-acute organizations.
Most weeks I am in conversation with chief executives about the same problem: the leadership bench is thinner than the plan assumes, and the seats are turning over faster than they used to. Below is what I am seeing across those conversations, with the numbers behind it. It is shared as a resource, with nothing attached to it.
Turnover at the top is accelerating after years of holding steady. The harder problem sits underneath it: boards are less likely to keep a written succession plan for the CEO and senior team than for almost any other duty they carry. So the seat that is most expensive to fill unexpectedly is the one least prepared for. And a CEO change rarely stays contained. It reshuffles the C-suite beneath it inside a year, which turns one vacancy into three or four.
At that margin there is almost no room to absorb the cost of a leadership seat sitting empty, or filled wrong. Kaufman Hall closed 2025 with the median near 1.3%, squeezed by rising non-labor costs, workforce instability and more aggressive payer denials. In that arithmetic, leadership continuity stops being an HR nicety and becomes margin protection. A vacant COO or CNO seat, or a failed hire that has to be unwound, shows up in throughput, in premium labor, and at the bottom of the page.
Nurse turnover ticked back up in 2025 after a brief decline, and the average hospital is losing north of five million a year to it. The pattern worth noting is structural rather than financial. The strongest performers have quietly stopped treating workforce as an HR problem and given a single operating executive real ownership of retention and labor cost, with the authority and the budget to match. The ones still running retention as a program inside HR are losing the fight and feeling it in agency spend.
With CEO, CNO and CMO seats opening faster than benches can fill them, and the clinical and administrative pipelines rarely coordinated, more systems are leaning on seasoned interim executives to hold continuity through a transition. Used well that is a strength: it buys time to run the permanent search properly rather than reaching for the nearest available name under pressure. Used as a permanent patch, it signals a pipeline problem the board should be asking about.
Every one of these patterns points the same direction. In a 1.3% margin environment, with the top seats turning over faster than the plans for them, leadership continuity is one of the few operating levers a chief executive still fully controls. The systems pulling ahead are not the ones with the biggest budgets. They are the ones treating their leadership bench with the same rigor they apply to their balance sheet.
If a version of this specific to your system and your market would be helpful, or you would simply value fifteen minutes on any of the above, that is a conversation I am always glad to have. I can often introduce you to a peer who is a step ahead on whatever you are working through.
No obligation, and nothing to sit through.
Grab fifteen minutesLee Fossey leads the healthcare practice for ISG-Americas, an executive search firm operating in more than fifty countries. Thirty years in executive recruitment, specializing in senior healthcare leadership: chief executives, chief medical and nursing officers, operations and finance leadership, and interim executives placed at short notice. Permanent search, interim leadership and strategic talent planning for organizations that cannot afford instability at the top.
Sources. American College of Healthcare Executives, hospital CEO turnover data. HealthLeaders Media and Advisory Board, 2025 to 2026 CEO departure tracking. Kaufman Hall, National Hospital Flash Report and 2025 Health System Performance Outlook. NSI Nursing Solutions, 2026 National Health Care Retention and RN Staffing Report.