Jefferson Health Reports $201 Million Operating Loss in First Half of Fiscal 2026

Got story updates? Submit your updates here. ›

Jefferson Health, a 32-hospital system spanning from South Jersey to Scranton, reported a $201 million operating loss in the first six months of fiscal 2026, including a $64.7 million restructuring charge related to layoffs of 600-700 employees. Excluding the restructuring expenses, the system's operating loss was $136.3 million.

Why it matters

The financial struggles at Jefferson Health reflect broader challenges facing healthcare systems nationwide, including rising drug costs and pressure to control expenses. The sizable operating loss has prompted credit rating agencies to revise their outlooks on Jefferson to negative, signaling potential downgrades if the system's finances do not improve.

The details

Jefferson Health's patient revenue reached nearly $6 billion in the first half of fiscal 2026, but the system reported a total revenue of $8.6 billion, which included $145.9 million in investment income. The health system's insurance arm, Jefferson Health Plans, saw its losses improve from $118.5 million to $90.7 million year-over-year, with Medicaid recipients accounting for most of the 371,005 people insured.

• The six-month period ended on December 31, 2025.
• In October 2025, Jefferson Health laid off 600 to 700 employees as part of a restructuring.

What’s next

Both Moody's Ratings and Standard & Poor's Ratings Service have revised their outlooks on Jefferson Health to negative, which means the agencies could downgrade the organization's credit rating if its finances do not improve over the next two years.