ALLENTOWN, Pa. — Jefferson Health, the parent organization of Lehigh Valley Health Network, announced that it will lay off about 1% of its workforce — roughly 600 to 700 employees — across all its hospitals and facilities.
The health system, which employs about 65,000 people, said the move is part of a broader effort to address ongoing financial challenges. Jefferson officials did not specify which departments or locations will be affected.
Dr. Joseph Cacchione, CEO of Jefferson, said in a statement that the cuts are part of a plan to stabilize the organization’s finances and prepare for the future.
“To sustain our mission and continue serving our communities, we must take thoughtful, strategic actions to align our operations for the future,” Cacchione said. “While these decisions are never easy, they are necessary to ensure Jefferson remains strong and able to invest in expanding access to care, advancing innovation, and supporting those who rely on us most.”
The announcement comes a little more than a year after Jefferson and LVHN completed their merger, creating one of the largest health systems in Pennsylvania.
The layoffs follow a recent report from credit rating agency Fitch Ratings, which downgraded Jefferson’s outlook to negative. Fitch cited significant financial losses in fiscal year 2025, including a $479 million operating loss and a $170 million shortfall from Jefferson Health Plans, the system’s insurance arm.
Jefferson’s struggles reflect broader financial pressures on hospitals nationwide. The American Hospital Association has warned that health systems continue to face steep costs from inflation, supply chain issues and underpayments from Medicare and Medicaid programs.
The news sparked frustration among some patients and employees. Local resident Nancy Snyder said this reflects a pattern within the LVHN systems.
“I have always gone to Lehigh Valley Hospital providers,” she said. “Since they joined with Jefferson trying to get an appointment with my current OB/GYN doctor they said they had a waitlist only. All other doctors in the practice are scheduled until March of 2026. Seems like all the doctors want to push you to another specialist and not see you.”
Community members also expressed concerns online.
“Patients first. Safety first. That’s what they tell the staff,” wrote Tim Hartzell on Facebook. “It’s actually bottom line first. Loss prevention first. Padding executives’ pockets first. These are people not overly vested in the community. They only care about the dollars. Now they get to work short-staffed, higher stress and higher patient loads.”
LVHN has not responded to a request for comment.