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‘It’s corrosive. They’re price gouging:’ Agency staffing is costing hospitals, LTC homes, critics say

Posted: August 19, 2022

(August 18, 2022)

By: Joanne Laucius, Ottawa Citizen

Ontario hospitals and LTC homes are filling in workforce gaps with nurses and other workers hired from agencies at a cost of more than two times the hourly rate that staff earn.

The issue was bubbling beneath the surface, particularly in the Toronto area and northern Ontario, but has now come to the forefront province-wide as Ontario wrestles with a health-care staffing crisis.

“If I were making $112 an hour and you were making $45, how do you think that would go over?” said Cathryn Hoy, president of the Ontario Nurses’ Association, which represents more than 68,000 registered nurses and other health professionals.

Staffing agencies have been providing temporary staff to hospitals for years to cover vacancies. But the COVID-19 pandemic has increased reliance on agencies to provide nurses and other workers to cover vacancies will add up to higher costs and has lured workers away from their jobs, nurses’ unions say.

“I have spoken to nurses who have been offered $112 an hour to work in the same ICU,” Hoy said.

Nathalie Mehra, executive director of the Ontario Health Coalition, said the network of more than 400 grassroots community organization had advocated against agency staffing for years and was now calling for it to be banned entirely.

“It’s corrosive. They’re price-gouging,” she said.

The Canadian Federation of Nurses Unions has requested that the Auditor General of Canada, along with her provincial counterparts, conduct an audit of the private companies contracted to fill nursing positions, including the total amount spent and the average pay rates over the past five years.

“Where are public dollars going? There’s a complete lack of transparency about how much they are paying agency nurses and how much they’re paying the agency,” said Linda Silas, president of the federation, which has about 200,000 members.

One of the problems is that there is little public information about how much is being spent on agency staff, and most of it is anecdotal.

In a Twitter video, Dr. Michael Warner, an ICU physician at Michael Garron Hospital in Toronto, said that, prior to COVID, agencies charged hospitals $65 an hour. They now charge $110 an hour, he said.

“I think this is exploitative and predatory. There’s one company that even offers surge pricing, whereby, if the shift is booked just prior to when the shift starts, the price goes up to $140 an hour,” he said.

The nurse doesn’t keep it all. But the amount they keep is far higher than than they would get with a unionized wage, even when other factors such as vacation pay and pension are factored in, Warner said.

Last year agencies were charging twice what staff were earning. It’s more than that now, said Lisa Levin, CEO of AdvantAge Ontario, which represents over 200 municipal and not-for-profit homes.

Some LTC homes have no other alternative than to use money intended for other purposes to pay for agency staffing, she said.

“At the beginning of COVID, agencies helped homes so much. It seems after the first couple of waves, they jacked up the prices. We’ve been hearing a lot about hospitals, but the problem is across the health care system,” Levin said.

“The agencies are gouging and approaching staff and offering them higher salaries. Our homes are having a much harder time finding people.”

Hoy aims to release figures soon that will offer some insight into the scope of the issue. Hospitals that use agency staffing must pay ONA a penalty. Some cheques are four times what they have been in the past, she said. ONA is gathering hospital-by-hospital information and plans to release it in the next month.

Agency nurses can help in a pinch, but they should only be used as a short-term stopgap, said Ivy Bourgeault, Research Chair in Gender, Diversity and the Professions at the University of Ottawa.

“If you are working right next to someone else, and they’re making more than you, it’s a built-in pay gap. It causes resentment,” Bourgeault said. “It may solve immediate staffing issues, but it creates long-term resentments in the system.”

Solutions to bring people back would include better working conditions, improved workplace culture and support from supervisors, managers and administrators. Nurses face high levels of workplace violence for example, she said.

“We all thought it was about the pay,” Silas said. “But it’s about the flexibility and getting away from the politics of a hospital. Agency nurses are not employees. They do their work, they wash their hands and they leave.”

Everyone focuses on recruitment, but it is more important to focus retention, Bourgeault said.

“You can’t recruit people in a system that’s bleeding. Why can’t you pay more for the nurses who are there and offer incentives to those who have left?”

Nurses unions and others argue that that Bill 124, which restricts salary increases to one per cent annually for a three-year period, must be repealed. They also argue at nurses should have wage parity with police officers.

Meanwhile, there is a need for a cadre of workers who are mobile. Being part of that mobile workforce should be incentivized, Bourgeault said.

There’s also a need to get everyone together at the table to discuss the human resources crisis, she said. Newfoundland and Labrador, for example, recently convened a think tank of stakeholders, she said. It also means finding out what incentives it will take to bring nurses back in.

“We need to support them, not vilify them. We need to learn what it would take to bring them back.”

In Ottawa, the bridging the staffing gap with agency workers appears to be used less often than it is in other parts of Ontario.

The Queensway Carleton Hospital, CHEO and the Montfort Hospital say they have not hired agency nurses. Ottawa’s four municipal nursing homes have also not hired agency nurses or PSWs.

A spokesperson for The Ottawa Hospital said it had used a small number of agency hours from the Community Health Registry of Ottawa over the past five years as part of a long-standing agreement for ambulance offload in emergency departments. But, outside of this, the hospital had not procured any agency nursing hours. 

The Perth and and Smiths Falls District Hospital closed the ER at its Perth site for about three weeks earlier this summer. A couple of agency nurses have been hired, said Dr. Alan Drummond, an emergency room physician at the hospital and co-chair of public affairs with the Canadian Association of Emergency Physicians.

Drummond said he wasn’t thrilled with the solution at first, but the nurses had worked out well.

“Would our emergency room be open without them? Probably not.”

Rachel Muir, who heads the Ontario Nurses’ Association unit at the hospital, believes hiring agency nurses is inevitable in Ottawa.

“We are so short of nurses and have so many unfilled vacancies there are not enough nurses to safely give the care out patients deserve and there is a significant reluctance to close beds or reduce services currently being provided,” she said.

Nicole McCallum, a spokesperson for Staffy, a platform that connects health care organizations to pre-vetted workers, said the platform filled last-minute or hard-to-fill shifts like on weekends, holidays or overnight.

The platform was originally developed to connect skilled workers with vacancies, then pivoted to support hospitals, LTC homes and other health organizations responding to the COVID-19 pandemic, McCallum said in a statement.  

Surge pricing is not part of the business model. The model is transparent and workers take home 100 per cent of the rate posted. The client is charged a service fee negotiated based on payment and contract terms,” she said. 

“At a time when our healthcare system is stretched, it is critical that we look to innovation to help fill gaps. Through the Staffy platform we can efficiently and effectively optimize health care workers to fill gaps in staffing across multiple hospitals and other organizations where they are most needed.” 

Speaking to reporters last week, Premier Doug Ford said he couldn’t control the prices charged by private-sector agencies.

“Can I dictate to any private company, should you be paying this to your employees, should you be paying that? I just can’t,” he said.

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