Watsonville Community Hospital CEO Stephen Gray will step down July 10 after leading the community-owned hospital for more than two and a half years, hospital officials announced Monday.
A press release sent out Monday did not give a reason for his departure.
The Pajaro Valley Health Care District Board, which oversees the hospital, has begun the process of selecting an interim chief executive officer while conducting a search for a permanent replacement. An interim CEO is expected to take over in July, with a permanent search planned for fall 2026.
Gray has served as CEO since November 2023, a period marked by efforts to stabilize the hospital following its transition to public ownership and ongoing financial challenges facing healthcare providers statewide and nationally.
“Steve’s commitment as the hospital’s CEO has bettered the lives of patients, staff and the larger Pajaro Valley community,” Pajaro Valley Health Care District board member Marcus Pimentel said in a statement. “Steve’s leadership was critical during the transition to a community-owned hospital, when we lacked systems and support. We’re grateful that Steve believed in our hospital.”
During his tenure, Gray oversaw the implementation of the hospital’s first strategic plan since becoming publicly owned. He also led efforts related to Measure N, a general obligation bond approved by voters in 2024 that provides funding to purchase the hospital and support future modernization and expansion projects.
Hospital officials said Gray also guided the establishment of primary care services on the Watsonville campus.
More recently, Watsonville Community Hospital has reported improvements in its financial position, including positive operating revenue and the receipt of more than $10 million in emergency state funding through a competitive grant process. Earlier this year, the hospital also earned top marks on a national patient safety rating.
Hospital officials did not provide a reason for Gray’s departure.
Watsonville Community Hospital serves residents of the Pajaro Valley, Santa Cruz County and northern Monterey County, providing inpatient and outpatient medical services. The hospital is owned and governed by the Pajaro Valley Health Care District, a public agency established in 2022 to preserve local healthcare services after the hospital was acquired through a community-led effort.
This story will be updated.
