Orochi is still alive and healthy. The one that Kaido beheaded is a Kanjuro drawing.
"But but how come Orochi knows Kaido will kill him?"
No, he didn't know, nor did Kanjuro. He just anticipated it because the prophecy of his falling is coming near. Seeing how much of a scaredy cat he is, yet also scheming and cautious one, it's not too farfetched to think of this possibility.
His scenario in mind: prepared double body just in case Scrubbards or their alliance will harm him.
To his surprise: it's Kaido who harmed him.
Supporting proof:
1. He never changes to his zoan form the entire time although iirc he liked to randomly transform before. It's because the drawing can't transform.
Counter arguments:
1. How can the drawing act and has a similar mind with Orochi himself (can talk, can complain when Kaido brought New Onigashima plan) etc. How can the drawing share the similar way of thinking with real Orochi.
But iirc before drawing Kanjuro was cut by Kinemon, the drawing could also shittalk just like the real Kanjuro.