I used the Exhaustion track in place of the 3 Death Saves track in my Curse of Strahd campaign and it worked well enough that I'm using the system again (amended a bit) in my current Eberron campaign. How my system currently works:
First, I changed up the levels of Exhaustion. They now are:
Level 1: Speed to half.
Level 2: Half Max HP.
Level 3: Disadvantage on attacks and saving throws.
Level 4: Disadvantage on skill checks.
Level 5: Unconscious.
Level 6: Death.
When a PC reaches 0 HP they are not "unconscious" per se... they instead just fall down dazed and completely out of it. The game mechanics are the same as the Unconscious condition, but I don't say fluff-wise that they are out cold. When their turn comes around again, they have to make a Death saving throw like they would normally. If they fail, they take 1 failed death save and drop to Level 1 on the Exhaustion chart. For every failed death save after that, they drop down another level. This continues until they have failed their 6th death save and drop to Level 6 on the chart, Death.
Unlike standard death saves, Exhaustion levels do not disappear when the PC gains hit points to bring them above 0. Their exhaustion level remains, as does all the penalties associated with their level. And should they get knocked down to 0 HP again, they pick up where they left off on the chart as they fail more death saves. After the combat is over and regardless of how many HP they regain through healing and spending hit dice and such, they are still at the Exhaustion level they were at through failed death saves.
In terms of regain Exhaustion levels, I've changed that up as well. First off, there is a new chart that shows how many long rests it takes to remove a level of exhaustion. Note that these rests are cumulative-- each extra level of Exhaustion you need to remove based purely on rest doubles the amount of time you need to rest:
To remove one level of Exhaustion: 1 Long Rest
To remove a second level of Exhaustion: 2 Long Rests (meaning 3 LR total)
To remove a third level of Exhaustion: 4 Long Rests (meaning 7 LR or a week total)
To remove a fourth level of Exhaustion: 7 Long Rests (meaning 14 LR or two weeks total)
To remove a fifth level of Exhaustion: 14 Long Rests (meaning 28 LR or an entire month total)
So if a PC gets knocked down to Level 5 Exhaustion, it will take a month of Downtime for them to recover. Does that suck? Oh yeah! Majorly! A character could be removed from action for an entire month in-game. Now granted, as I'm using the Downtime rules and I have 15 total players that come and go every-other-week, the player of the Exhaused PC might not actually have to miss any actual sessions due to their PC being out of it. The story of the campaign might easily see the two weeks to a month happen "between sessions". But because that isn't guaranteed... this does result in players now acting in a way I feel is very important:
All the players know that due to the harsh penalties of reaching 0 HP... it is imperative that all PCs help "spread the wealth" as it were when it comes to running into combat and taking the occasional hit to absorb some damage. In the past over time I found there was nothing more irritating than an Archer ranger player (for instance) refusing to enter melee because they felt like they were a "ranged" character and thus though they were a glass cannon-- despite having just as many hit points as the melee fighters and paladins, and even more HP than the melee rogues and monks who stood in there and took the hits. Any time these rangers got engaged in melee, the response was always "Well, that's it, I'm dead!" It was a stupid attitude then, and a stupid attitude now... and thus this system of mine pretty much assures everyone that they CAN'T just let the platemail-wearing Fighter be the only one in melee, get knocked down to 0, then healed back up, then knocked down again, etc. etc. while everyone else stays at a safe distance. Because those Exhaustion levels will catch up pretty quickly, and everyone will find that a Tank with Level 3 Exhaustion that is attacking and saving with Disadvantage and who need an entire week of rest before he's good again, makes for pretty poor adventuring. Which is exactly the way I like to run it.
PS: Two other additional rules I have in my system is that any Exhausted PC who spends their first Long Rest being tended to by another party member (who uses their Long Rest to do the tending and thus not get any other benefits) can get a second Exhaustion level removed "for free". On top of that... I also rule that the Lesser Restoration spell can be cast on an Exhausted character once to remove one level of Exhaustion "for free" as well. A second Lesser Restoration spell will not do any additional help until all levels of Exhaustion have been removed, at which time both it and the "tending" bonus are reset. So things are actually not as onerous as they might seem, as a healer who spends a Long Rest first casting Lesser Restoration and then tending to an Exhausted PC can move them from Level 3 Exhaustion to no longer exhausted in a single Long Rest. But that's just for one PC... the others better have available party members to tend to them too.
First, I changed up the levels of Exhaustion. They now are:
Level 1: Speed to half.
Level 2: Half Max HP.
Level 3: Disadvantage on attacks and saving throws.
Level 4: Disadvantage on skill checks.
Level 5: Unconscious.
Level 6: Death.
When a PC reaches 0 HP they are not "unconscious" per se... they instead just fall down dazed and completely out of it. The game mechanics are the same as the Unconscious condition, but I don't say fluff-wise that they are out cold. When their turn comes around again, they have to make a Death saving throw like they would normally. If they fail, they take 1 failed death save and drop to Level 1 on the Exhaustion chart. For every failed death save after that, they drop down another level. This continues until they have failed their 6th death save and drop to Level 6 on the chart, Death.
Unlike standard death saves, Exhaustion levels do not disappear when the PC gains hit points to bring them above 0. Their exhaustion level remains, as does all the penalties associated with their level. And should they get knocked down to 0 HP again, they pick up where they left off on the chart as they fail more death saves. After the combat is over and regardless of how many HP they regain through healing and spending hit dice and such, they are still at the Exhaustion level they were at through failed death saves.
In terms of regain Exhaustion levels, I've changed that up as well. First off, there is a new chart that shows how many long rests it takes to remove a level of exhaustion. Note that these rests are cumulative-- each extra level of Exhaustion you need to remove based purely on rest doubles the amount of time you need to rest:
To remove one level of Exhaustion: 1 Long Rest
To remove a second level of Exhaustion: 2 Long Rests (meaning 3 LR total)
To remove a third level of Exhaustion: 4 Long Rests (meaning 7 LR or a week total)
To remove a fourth level of Exhaustion: 7 Long Rests (meaning 14 LR or two weeks total)
To remove a fifth level of Exhaustion: 14 Long Rests (meaning 28 LR or an entire month total)
So if a PC gets knocked down to Level 5 Exhaustion, it will take a month of Downtime for them to recover. Does that suck? Oh yeah! Majorly! A character could be removed from action for an entire month in-game. Now granted, as I'm using the Downtime rules and I have 15 total players that come and go every-other-week, the player of the Exhaused PC might not actually have to miss any actual sessions due to their PC being out of it. The story of the campaign might easily see the two weeks to a month happen "between sessions". But because that isn't guaranteed... this does result in players now acting in a way I feel is very important:
All the players know that due to the harsh penalties of reaching 0 HP... it is imperative that all PCs help "spread the wealth" as it were when it comes to running into combat and taking the occasional hit to absorb some damage. In the past over time I found there was nothing more irritating than an Archer ranger player (for instance) refusing to enter melee because they felt like they were a "ranged" character and thus though they were a glass cannon-- despite having just as many hit points as the melee fighters and paladins, and even more HP than the melee rogues and monks who stood in there and took the hits. Any time these rangers got engaged in melee, the response was always "Well, that's it, I'm dead!" It was a stupid attitude then, and a stupid attitude now... and thus this system of mine pretty much assures everyone that they CAN'T just let the platemail-wearing Fighter be the only one in melee, get knocked down to 0, then healed back up, then knocked down again, etc. etc. while everyone else stays at a safe distance. Because those Exhaustion levels will catch up pretty quickly, and everyone will find that a Tank with Level 3 Exhaustion that is attacking and saving with Disadvantage and who need an entire week of rest before he's good again, makes for pretty poor adventuring. Which is exactly the way I like to run it.
PS: Two other additional rules I have in my system is that any Exhausted PC who spends their first Long Rest being tended to by another party member (who uses their Long Rest to do the tending and thus not get any other benefits) can get a second Exhaustion level removed "for free". On top of that... I also rule that the Lesser Restoration spell can be cast on an Exhausted character once to remove one level of Exhaustion "for free" as well. A second Lesser Restoration spell will not do any additional help until all levels of Exhaustion have been removed, at which time both it and the "tending" bonus are reset. So things are actually not as onerous as they might seem, as a healer who spends a Long Rest first casting Lesser Restoration and then tending to an Exhausted PC can move them from Level 3 Exhaustion to no longer exhausted in a single Long Rest. But that's just for one PC... the others better have available party members to tend to them too.
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