Spending on temporary agency nurses has soared by millions of dollars at some of Ontario’s largest hospitals grappling with severe staffing shortages, with one that paid over 550 per cent more in its last fiscal year compared to pre-pandemic years.
Ontario’s health worker staffing crisis has prompted ballooning wait times in hospitals, forcing some to cancel surgeries or even temporarily shutter emergency departments.
Since the pandemic began, hospitals across the country have increasingly turned toward agency nurses, nursing unions say. But critics say this stopgap solution is a dangerous symptom of deeper dysfunction in hospitals, where exhausted nurses are leaving permanent jobs for flexible gigs at privately owned temp agencies — where they can sometimes earn double their old hourly rate.
“Agency nursing is a form of privatization,” said Doris Grinspun, CEO of the Registered Nurses’ Association of Ontario. “And really, the ones who are making the mega money are the agencies.”
In its last fiscal year ending March 2022, the University Health Network, Canada’s largest research and teaching hospital network, has already spent $6.7 million on agency nurses — a significant jump compared to 2018, when it spent $1.035 million.
During the fiscal year that ended in 2021, UHN only spent about $776,000 on agency nurses.
“It’s gut-wrenching … we will not be able to sustain our health-care system with numbers like that,” said Linda Silas, president of the Canadian Federation of Nurses Unions.
“These are public dollars going to private agencies,” she added. “You think okay, employers, government — let’s shake our heads here. We have to take that money that you’re spending and throwing down the drain, and start fixing the workplace.”
The Star requested a breakdown of agency staffing expenditure over the past four years at 23 of the province’s largest acute care hospitals and regional health centres.
Of the Toronto hospitals that responded, UHN saw the single greatest increase in agency spending.
The staffing issues facing hospitals across the province are particularly severe at UHN, one of the few — and sometimes only — care centres for acute COVID cases and other serious illnesses, said president and CEO Dr. Kevin Smith.
“Our staff are particularly worn down,” he said.
Since UHN provides more specialized and therefore expensive care than other institutions, it had a smaller pool of staff to draw from to begin with, said Smith. Plus, agency billing rates have gone up, he added.
Smith said he hoped the past year’s extra temp agency costs will not become the norm. If they did, it would spell trouble without increased government transfer payments.
“We’re just not funded to absorb that kind of increase in cost for agency nurses. At the moment, we’re running a deficit to absorb it,” he said.
“If that were the norm, we’d have to find, on top of all of the other savings we need to find every year, an additional five or $6 million in order to be in a balanced position,” he added. “It is not sustainable.”
Silas said she first started noticing an alarming shift towards agency nurses in the fall and her organization has since been calling for policymakers and auditor generals across Canada to investigate how much hospitals are paying privately owned agencies.
“We don’t know how many there are, how much they’re charging employers, or even how much they’re paying nurses,” Silas said. “There’s no transparency and these are public dollars going to private agencies that we hear are charging two, three and four times the salary of a nurse for each shift.”
According to the Ontario Hospital Association, the proportion of agency nurses used by hospitals has “remained stable” in recent years, roughly accounting for less than one per cent of all nursing hours worked within hospitals. But costs have grown because of the significant “increase in rates” that agencies are now charging hospitals, the OHA said.
The OHA said it doesn’t have data on how much hospitals are spending on nursing agencies, and directed the Star to the Ministry of Health and individual hospitals.
The Ministry of Health did not respond to the Star’s request for data on expenditures for agency nurses, but spokesperson Bill Campbell said staffing and salaries are hospitals’ responsibility.
“Many of the pressures currently facing the health system are not new; none are unique to Ontario,” he said. He added that Ontario has launched the “largest health-care recruiting and training initiative in the province’s history” and cited as one example a new “temporary financial incentive” to support nursing retention by offering lump sum payments of up to $5,000.
Of the 23 hospitals and health networks that the Star reached out to, 17 provided detailed responses or breakdowns of expenditures. Major GTA hospitals like Sinai Health, William Osler Health System, Halton Healthcare and Scarborough Health Network did not provide the data by the Star’s deadline.
The Star also reached out to 10 temporary agencies that supply nurses to Ontario hospitals to ask about their hourly wages for nurses and the markups they’re charging. Only two responded, but neither provided details.
“Due to the proprietary and confidential nature of your questions relative to our hospital partners, staff and clients, we are unable to respond to your specific questions,” said Chris Albion, president of Helping Hands Healthcare.
“Agency staffing typically represents a small fraction of hospital staffing, however continues to play a key role for hospitals in meeting gaps in a flexible, effective manner.”
According to hospital invoices seen by the Star, another agency that supplies temporary nurses to major Ontario hospitals was charging hospitals $105 per hour plus HST this summer — nearly double what it was charging last fall.
A third agency that supplies nurses to UHN and other major hospitals was charging $110 per hour for temp nurses, according to an April 2022 invoice seen by the Star.
These invoices don’t specify the proportion that goes toward paying the nurses. Job postings by the same agency advertise hourly wages of $40-$65 per hour for registered nurses and $70-$87 per hour for critical care nurses.
“It’s going to bankrupt health care,” said Cathryn Hoy, president of the Ontario Nurses’ Association.
The trend has other significant implications, she added: Agency nurses sometimes do not know patients well, jeopardizing continuity of care; and when nurses are unfamiliar with their environment, they may be at greater risk of injury or violence.
“It’s all about knowing your place of work,” said Hoy.
Nonetheless, a morale-crushing confluence of factors — from stagnant wages and pandemic burnout to soaring living costs — has pushed some nurses into agencies’ arms.
Since Anna Seto quit her nursing job at UHN and joined an agency, she’s noticed a “drastic improvement” in her well-being and mental health. She was one of the first health workers in Ontario to get COVID on the job during a hospital outbreak in April 2020 and spent most of the pandemic working one of its most demanding jobs: nursing in the ICU.
By April 2022, Seto was feeling overworked, deeply burnt out and disrespected. Health-care workers were facing backlash from the public, she struggled to get time off and the government’s refusal to repeal Bill 124 — which capped nurses’ salary increases — felt like a “slap in the face.”
Seto also said that at times nearly half of the nurses in her ICU were from agencies — and getting paid twice as much. Meanwhile, the agency nurses sometimes added to the workload of staff nurses, who had to show them the ropes or help them access medication storage rooms that require a staff ID.
“Morale was low,” Seto said. “It felt like we’d worked through this entire pandemic — seeing so many people die, saving as many lives as we possibly could — and at the same time there was no recognition of that.”