Jefferson Health lays off several hundred workers

After suffering significant losses, Jefferson Health is laying off several hundred staffers.

The Philadelphia-based health system said this week it is cutting about 1% of its workforce, according to 6abc, NBC 10, and other local media reports. Such a reduction means Jefferson is laying off between 600 and 700 workers. Jefferson had reported a workforce of about 65,000.

Joseph Cacchione, CEO of Jefferson Health, said the staff cuts are needed due to financial headwinds.

“To sustain our mission and continue serving our communities, we must take thoughtful, strategic actions to align our operations for the future,” Cacchione said in a statement.

Jefferson Health follows a host of other hospital systems that have announced staff reductions. Since the beginning of June, U.S. hospitals have laid off thousands of employees. Some have cited reductions in federal funds, including President Trump’s administration terminating grants from the National Institutes of Health.

Earlier this week, Fitch Ratings downgraded its outlook for Jefferson Health to “negative,” although the system retains an “A” bond rating.

Jefferson reported a $479 million operating loss in the 2025 fiscal year, Fitch noted, although about $271 million in investment income was moved out of the system’s operating budget. Jefferson reported $15.5 billion in revenue for the 2025 fiscal year.

A big factor in Jefferson’s rough year came from its health insurance subsidiary, Jefferson Health Plan, which reported a $170 million loss in 2025, Fitch noted. In 2024, the health plan generated $100 million in profit. The health plan has about 370,000 members.

Jefferson Health also reported a $200 million loss in 2024.

Last year, Jefferson Health completed the acquisition of the Lehigh Valley Health Network in northeastern Pennsylvania. With the addition of Lehigh Valley, Jefferson now operates 32 hospital campuses and more than 700 other healthcare locations in the Philadelphia region, eastern Pennsylvania and southern New Jersey.

Jefferson also acquired the Einstein Healthcare Network in 2021.

Jefferson holds about 28% of the inpatient market share in southeastern Pennsylvania, which includes Philadelphia, and 20% of the inpatient market in southern New Jersey, part of the Philly suburbs, according to Fitch Ratings. Jefferson competes with Penn Medicine and Temple Health in the Philadelphia region.

Lehigh Valley Health Network controls about half of the inpatient market in its region, and some of its counties are poised for more growth, Fitch says.

While acknowledging Jefferson Health’s financial difficulties, Fitch projects a “measured recovery” over the next 24 to 36 months.

Fitch points to Jefferson’s strong reputation and fundraising success, but the system has a substantial number of patients who have no insurance or are relying on Medicare and Medicaid.