Why some worry about the rise of private agency health-care staffing firms in Canada

There were more than 41,955 job postings across Canada for nurses in the first quarter of 2023, missing manpower that is affecting hospital staffing, closing rural ERs and fuelling the expansion of companies that supply temporary nurses.

The trend is triggering worry that it is slowly privatizing the backbone of health services — nursing care — with an urgent call for more scrutiny.

"We don't really know what's happening across the country," said Joan Almost, a professor in the faculty of nursing at Queens University in Kingston.

"I'd like to know how much they're actually charging organizations. How do they decide on that? And how many have jumped on the bandwagon to go into hospitals now that weren't in there before?" she said.

Almost is in the midst of a study, sponsored in part by the Canadian Federation of Nurses Unions, to study the exponential use of agency nurses and the companies behind them. They supply nurses and other medical staff to hospitals. But the hourly fee is two to three times higher than the hourly rate for a staff RN. Nurses may also receive travel and rent costs. There are also "finder" fees for the agency, for procuring and scheduling urgently needed health-care workers.

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Canadian taxpayers are funding it all, says Almost.

"That's very concerning that taxpayers' money is going towards a profit for some other agency.”

As an example, one company, Premier Health America, was recently featured as a stock to watch on the TD Waterhouse investing site. Based in Quebec, it purchased Staffing Solutions in July, which is one of B.C.'s largest private health-care agencies.

The company has plans to expand further.

"We are trying to get coast-to-coast Canadian footprint, which we are trying to do in the next 3 years or so," Jean Robert Pronovost, vice president of corporate development, said in an interview posted on the company website in 2022.

Calain is another Canadian-based company that, among other services, supplies nurses to hospitals. It, too, is listed on the TSX and offers investors a dividend.

Staffy, another staffing agency, was cited in 2022 for its "rapid revenue growth" by financial investment firm Deloitte.

They hire nurses like "Mary." She asked CTV not to use her real name or location, fearing it might affect her ability to get work.

She told CTV News she moved to agency work after burning out from long hours and stress working in an emergency unit.

As a staffer she couldn't control her hours. Agency nursing allows her to select her shifts. She also likes the bump in pay. As an agency nurse, she says she gets nearly $100 an hour including expenses. On staff, the hourly rate is $44.

The money and flexibility are capitalizing on exhaustion and frustration.

"Many of us have gotten to the, ‘If you can't beat them, join them,’” she told CTV National News. “We might as well make money, but (we’re also) acknowledging that it's a completely broken system that shouldn't be like that.”

There is a high price for hospitals that need agency nurses. Toronto's University Health network paid $915,786 for temporary nurses in 2018-2019, according to CEO and president Kevin Smith. Now it's jumped to $10.9 million in 2022-2023.

There are few rules on agency fees, says Ivy Bourgeault, a researcher at the University of Ottawa.

“I think that they're seizing upon an opportunity. And I think that I described it as a wild west before — what that means is that there are not effective regulations of that system,” she told CTV News.

"It's an insidious privatization of the system," argues Bourgeault, who supports the need for studying the issue further.

“Hopefully, you know, this analysis of agency nurses, which is sorely needed, will help to provide some clarity about what is actually happening so that we can start making recommendations … and start to try to correct it,” said Almost.

DESTABILIZING THE FRONT LINES

Agency nurses may fill holes in the front line, but they only add to the pressure on nurses like Kim Bauer. The Ontario nurse has chosen to stay as a staff RN because she wants the benefits and pension.

But the veteran emergency nurse says it causes her distress to work alongside many agency nurses who drop in for a shift or two and are paid what she says is double her wage.

“I have 34 years experience, mostly in the emergency department,” Bauer said. “They make twice as much as I do and they cost the hospital another at least twice as much,” she said. “And I find it extremely frustrating that there's no compensation for the fact that I have (many) years of experience."

A treatment room in the emergency department at Peter Lougheed hospital is pictured in, Calgary, Alta., Tuesday, Aug. 22, 2023. THE CANADIAN PRESS/Jeff McIntosh

Being surrounded by agency, or as some call them "travel" nurses, instead of staff colleagues can also complicate the process of caring for patients because they aren’t familiar with the layout of the hospital the way that she is, she said.

“My job is to save lives. And when I'm in a situation where I have travellers and I am the primary caregiver in a trauma situation and I say, ‘I need somebody to go get me this,’ and it's me and three travellers, I can't leave the bedside and I have to rely on them to know where things are and more often than not, they don't.” said Bauer.

This leads to her ricocheting around the ward to retrieve what she needs, and then having to catch up with what happened with the patient while she was gone, instead of being able to remain stationed where she is most needed.

“So the continuity of care is not there,” she said. “And it's frustrating for the travellers because they didn't have a decent enough orientation.”

"I know of some ... hospitals where whole floors are most exclusively staffed by traveling nurses," said Damien Contandriopoulos, a nursing professor at the University of Victoria. "That's a disaster ... because the remaining nursing staff (are) under tremendous pressure," adding that there may be an added risk to patients.

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There may also be, he suggests, a risk to patients.

"If you talk to any nurse, they would say, ‘Well, errors and medications, errors and treatments are bound to happen,’" said Contandriopoulos.

One study, published in the Journal BMJ Quality and Safety, reported that “agency nurses are not effective substitutes for RNs who regularly work on the ward."

Most experts interviewed for this story agree that staff nurses make for the safest, best nursing.

"People who work together regularly are on a consistent team, who know each other, who know each other's style of practice. So I understand patterns and practice. For sure. That's the optimal outcome," said Kevin Smith the CEO and president of UHN. His hospital is now trying to boost retention of staff and hiring foreign nurses.

The key issue for nurses across Canada is that they want more control over their workload, less mandatory overtime and better pay, which in some provinces has been capped.

"You're gonna give pennies to the health workers who are not in the agencies, but you're giving pounds ... to those in agencies? So we need to, we need to recalibrate that,” says Bourgeault.

"I think we're all going to be challenged by thinking about either more creative ways, without significantly increasing the total cost of compensation for nurses to see more direct cash while working directly for us.”

THE WARNING FROM QUEBEC

For almost a quarter of a decade, Quebec has increasingly relied on agency nurses to make up for missing manpower. By 2022, officials were paying agencies shy of a billion dollars a year, with some reports suggesting the tally might be higher, at $1.5 billion. 

Contandriopoulos calls it a "disaster" that has prompted an abrupt about-face.

"What we're seeing now is a government that is really desperate to ban those agencies," he said, adding "there is no easy way out."

The provincial health ministry there has put measures in place to encourage better working conditions and pay, and to discourage staff nurses from going private. They are designed to give nurses from private agencies less desirable shifts and make it more difficult for nurses to move from public to private companies.

It also introduced a law that will restrict agency nurse use, outlining limited conditions where they can be hired, along with fines of up to $150,000 for those who break the rules.

But Contandriopoulos isn't convinced it will be effective.

"Are we going to force nurses to come back as public employees? And if they don't return, Are, you going to work with ER rooms with half the staff?" he asks.

Health Minister Christian Dube has, in interviews, emphasized again that it will be a gradual process, with high fees for agency nurses a continuing cost.

But Contandriopoulos says Quebec’s dilemma is a clear warning for other provinces focusing on agency instead of staff retention. Take, for example, the fact that eight Toronto hospitals signed a five-year contract with a firm to secure a steady supply of health workers.

"The more we allow private interests that are only there for the money, equity firms, investment firms from outside of the country` to be core cogs in the system of our health-care system, the more dangerous it's going to get," said Contandriopoulos.

"It's going to be even harder if you're dealing with equity companies that have the power to sue and to lobby. Those guys are not going to be fun to try to get rid of when we need to."