Rise in for-profit agency nurse costs in Ontario hospitals ‘exorbitant,’ says researcher
Ontario hospitals have paid for-profit staffing agencies a staggering $9.2 billion over the span of a decade, according to a recent report commissioned by the Canadian Centre for Policy Alternatives. This finding is alarming, especially as one hospital in particular is striving to eliminate its reliance on temporary services by September.
The report, titled “Hollowed Out: Ontario Public Hospitals and the Rise of Private Staffing Agencies,” highlights the significant increase in spending on these agencies for nurses, allied health professionals, and administrative support staff from 2013-14 to 2022-23. Hospitals and long-term care facilities often turn to staffing agencies when they are unable to fill all their shifts with regular employees. While temporary agency workers provide a necessary service during staff shortages, they come at a steep cost, charging up to triple the regular hourly rate.
Real spending on these agencies nearly doubled from $21 per capita to $41 over the study period, while public hospital employed staff only saw a marginal increase from $604 per capita to $641. This imbalance raises concerns about the value that hospitals are receiving in exchange for the exorbitant amounts they are paying to private for-profit providers.
Andrew Longhurst, a political economist at Simon Fraser University and the author of the report, noted that this trend is exacerbated by provincial fiscal austerity measures, which destabilize hospitals at a time when population growth and aging are placing additional pressure on staffing. This, in turn, contributes to issues like hallway medicine and long wait times for patients in emergency departments or for scheduled surgeries.
The reliance on private agencies creates a detrimental cycle, where hospitals become dependent on these costly services, further exacerbating the staffing crisis in the public sector. However, there are efforts being made to break free from this cycle. Markham Stouffville Hospital, part of Oak Valley Health, is working towards becoming “agency free” by the end of September. They have already managed to reduce their agency nursing staff by two-thirds through initiatives such as providing extra training and support to newly graduated and internationally educated nurses, creating a nursing resource team, hosting recruitment events, and increasing direct hiring.
The Ontario government’s Nursing Graduate Guarantee program has been instrumental in supporting new graduate nurses and internationally educated nurses as they transition into full-time practice. This program has successfully hired over 3,300 nurses since 2020, providing a pathway for individuals to enter the healthcare workforce without relying on temporary agency placements.
In comparison to other provinces, Ontario has the lowest per capita hospital spending in Canada, further highlighting the strain on hospital budgets. Particularly in smaller and northern regions of the province, where hospitals have revenues under $100 million, the reliance on for-profit agencies is even higher. In an effort to address this issue, Quebec has passed a law to phase out the use of private placement agencies by 2026, with similar efforts underway in New Brunswick and British Columbia.
As the healthcare landscape continues to evolve, it is crucial for hospitals to prioritize sustainable staffing practices that prioritize patient care and cost effectiveness. By reducing reliance on private agencies and investing in their own staff, hospitals can ensure continuity of care and provide a higher quality of service to patients.
