Jefferson Health to outsource administrative jobs
PHILADELPHIA, UNITED STATES — Jefferson Health, the largest hospital system in the Philadelphia region, is outsourcing back-office jobs as part of a cost-cutting strategy.
The nonprofit health system confirmed the decision, stating that the affected roles include billing, insurance preauthorization, and clinical documentation—functions collectively known as revenue cycle management.
“Following a thorough review, we are transitioning a limited number of non-patient facing administrative functions to an external partner to enhance efficiency,” Jefferson said in a statement.
The organization is offering resources to assist displaced employees who do not secure new roles within the system. However, Jefferson did not disclose the name of the external company handling these operations.
Layoffs to impact remote and office-based employees
According to a notice filed with the Pennsylvania Department of Labor and Industry, 171 employees will lose their jobs by March. While many of these employees work remotely, they report to offices in locations such as Philadelphia, Abington, Cherry Hill, and Norristown. Some of the affected positions include unionized roles at Jefferson Einstein, which was acquired by Jefferson in 2021.
A spokesperson for the Pennsylvania Association of Staff Nurses and Allied Professionals union criticized the decision: “We are disappointed that management has chosen to eliminate these positions. We are awaiting a response from management as to why these highly skilled jobs, all of which are essential to the daily operations of the hospital, are being eliminated.”
Financial struggles prompt operational restructuring
The outsourcing move comes as Jefferson Health faces mounting financial challenges. The health system reported a $90.5 million operating loss for the quarter ending Sept. 30, despite a 10% increase in revenue compared to the previous year. To address these issues, Jefferson has implemented several cost-saving measures over recent months.
In November, Jefferson postponed annual pay raises for over 42,000 employees from January to July, aligning salary increases with its fiscal year while improving its financial position. Additionally, Jefferson has centralized patient scheduling functions and entered joint ventures for services like laboratory testing and mammography.
Expansion through acquisitions adds financial pressure
Jefferson’s rapid growth through acquisitions—including its 2021 purchase of Einstein Healthcare Network—has added complexity to its operations. The nonprofit is also transitioning to new software for clinical and billing operations at former Einstein facilities.
As Jefferson navigates these financial pressures across its 32-hospital network spanning Pennsylvania and South Jersey, it continues to adjust its workforce strategy while seeking long-term sustainability.
