I don't know if it is taxable or not to PA, generally PA does not exempt much.

Be sure that you checked the box on the W-2 worksheet indicating that the amount is from a 3rd party payer.

Google !!!

Sick pay and sick leave are taxable compensation when representing regular wages. ... Payments, not representing regular wages, including payments made by third party insurers for sickness or disability, are not taxable income for Pennsylvania purposes.