Federal Bill Seeks to Understand Impact of Staffing Agencies in Health Care

While some see staffing agencies as more than a necessary evil for nursing homes industry amid-wide staffing shortages, lawmakers and advocates continue to push for more oversight and regulation over how these companies in the space.

Earlier this week, US Sen. Kevin Cramer of North Dakota introduced the Travel Nursing Agency Transparency Study Act, a bill that would require the Government Accountability Office (GAO) to conduct a study on the effects hiring agencies have had across the health care industry during the Covid-19 pandemic.

The bill proposes that the government agency look into the business and payment practices of staffing agencies, including potential price gouging and taking of excessive profits. specifically, GAO’s investigation will look at the difference between how much agencies charged health care institutions and how much they paid nurses.

GAO would report directly to Congress on its findings in one year.

“The health care industry was already experiencing a shortage of professionals prior to the pandemic, but Covid-19 exculpated this issue throughout the country, especially in rural communities,” Cramer said in a news release.

“Over the past few years, there have been anecdotal reports of hiring agencies inflating prices and monopolizing the nursing workforce, potentially leading to a number of concerning consequences for providers, patients, and taxpayers,” he added.

Cramer noted that inflated prices for care and further nursing shortages have continued to put a strain on the entire health care system.

And he is hardly the first official to accuse staffing agencies of unfair practices.

The American Health Care Association/National Center for Assisted Living has heard from its members about staffing agencies charging exorbitant prices to health care facilities, in some cases more than double and quadruple pre-pandemic rates. The organization voiced its support of the bill after it was introduced.

The study will also look into how states that imposed caps to contract nurse pay were affected by such caps.

Several states including Maryland, Idaho, Indiana, Kansas, New York and Pennsylvania have introduced bills to address price gouging and while none made it past committee votes, Minnesota has had an agency cap law in place for roughly 20 years.

Minnesota’s cap stipulates that the maximum charges for 2022 are: $62.36 for registered nurses (RNs), $50.75 for licensed practical nurses (LPNs), and $34.10 for certified nursing assistants (CNAs).

Oregon and Kentucky appeared to be the furthest along with legislation that went into effect in March and April, respectively.

The Oregon state law requires temporary staffing agencies to apply for a license to operate in the state, as well as annually evaluate and implement maximum rates agencies may charge.

Kentucky Gov. Andy Beshear signed HB 282 into law April 8, prompting the state to define and establish registration of health care services agencies, and have agencies retain documentation of direct care staff credentials.

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