Across Pennsylvania, patients, families and health care providers are feeling the strain of a reimbursement system that has been unsustainable for far too long.
The ongoing contract dispute between UnitedHealthcare and Lehigh Valley Health Network, now part of Jefferson Health, is not an isolated disagreement. It is a symptom of a deeper problem — one that threatens access to care in communities that rely on their local hospitals and physicians.
For months, our teams at Jefferson and LVHN have negotiated in good faith with UHC. We have approached each conversation with a clear goal: to secure fair reimbursement that supports high-quality care, retains clinicians and preserves local access for our patients. Unfortunately, despite repeated efforts, UHC has declined to engage on terms that reflect the real cost of care or even the financial commitments UHC originally agreed upon. The company’s refusal has put patients in the middle of a dispute they never asked for and should never have to navigate.
When insurers impose reimbursement cuts or refuse to adjust rates to match escalating costs, providers are left with an impossible choice — accept payment that undermines the ability to deliver care safely or stand up for patients and the long-term viability of the health system. We are choosing to stand up.
This issue is bigger than one contract. Hospitals in Pennsylvania are among the most underreimbursed in the country. Reimbursement from public payers has been consistently less than the true cost of delivering care, and commercial reimbursement in the state is 29% lower than the national median, according to a recent study. Meanwhile, labor costs, drug expenses, technology needs and liability premiums continue to climb at rates that far outpace inflation.
That math does not work — not for hospitals, clinicians or patients. Pennsylvania’s hospitals have reached a breaking point. More than half are operating below sustainable margins, over a third are losing money, and dozens have closed in recent years.
A recent report from the Hospital and Healthsystem Association of Pennsylvania stated that more than a dozen Pennsylvania hospitals could be at risk of closing over the next five years without policies that align hospital payments with the cost of providing care. These closures do not just reduce convenience; they pose the risk of eliminating trauma centers, maternity units, cancer care programs and emergency departments that entire regions depend on.
When reimbursement rates fail to cover the cost of care, the consequences are immediate and deeply felt. As of Jan. 5, 400 Medicare Advantage patients became out of network with LVHN physicians because of the impasse with UHC.
Patients should never have to delay treatment, travel long distances or pay out of pocket for care they used to receive close to home simply because an insurer is unwilling to reimburse providers fairly. Yet that is exactly what is happening. And more disruptions are looming: If no agreement is reached, as many as 50,000 additional patients with UHC commercial plans will become out of network April 26.
Against this backdrop, a special Medicare Advantage enrollment period recently announced by Gov. Josh Shapiro offers patients a meaningful and urgently needed option. Because the state successfully petitioned the federal government, UnitedHealthcare Medicare Advantage members affected by this dispute now have until April 30 to select new coverage that allows them to remain in network with LVHN.
This special enrollment period gives older adults more flexibility than usual. Members can transition to another Medicare Advantage plan or move to traditional Medicare and purchase a Medicare Supplement policy — without being denied coverage due to preexisting conditions. During this time, Pennsylvania Medicare Education and Decision Insight counselors are available through local Area Agencies on Aging to help individuals evaluate their options.
While no one is required to switch, patients should understand the implications: Remaining with UHC while continuing care with LVHN may lead to higher out-of-pocket costs.
This moment calls for clarity, not confusion. It calls for solutions, not stalemates.
Our position is simple: Jefferson and LVHN will continue pursuing fair reimbursement that supports high-quality, local care for the communities we serve. We will work constructively with any payer — UHC included — that is willing to negotiate in good faith on behalf of the patients who depend on us. What we cannot do is accept reimbursement cuts that jeopardize patient access, destabilize our workforce or threaten the long-term viability of Pennsylvania’s hospitals.
This dispute is not about trying to “win” a negotiation. It is about protecting patients, preserving access to care and confronting a long‑standing reality: Pennsylvania’s health care system cannot continue absorbing chronic underpayment while costs soar and expectations grow.
Our commitment to our patients is unwavering. We will keep fighting for fair agreements, transparent practices and a reimbursement model that ensures the people of this region can receive the care they need, where they need it, from the clinicians they trust.
Because patients must always come first.
This is a contributed opinion column. Dr. Joseph G. Cacchione is the CEO of Jefferson. The views expressed in this piece are those of its individual author, and should not be interpreted as reflecting the views of this publication. Do you have a perspective to share? Learn more about how we handle guest opinion submissions at themorningcall.com/opinions.