January 31, 2022

Pressures mount for staffing agencies accused of price gouging long-term care operators

McKnights Senior Living

While senior living and other long-term care leaders are being joined by other healthcare groups, and even members of Congress, to call for federal action against price-gouging by temporary staffing agencies, some states are making their own moves to cap rates and increase oversight.

In Pennsylvania, Rep. Tim Bonner has introduced HB 2293 to establish oversight of healthcare staffing agencies accused of price gouging assisted living communities, personal care homes and nursing homes. The bill also would cap rates at no higher than 150% of the average rate and assess fines for violations.

If passed, Pennsylvania would become the third state to implement wage caps, along with Massachusetts and Minnesota. Jan. 1, Illinois amended the Illinois Freedom to Work Act to remove non-compete and non-solicit clauses used by staffing agencies. Most state legislatures have taken action against price gouging on supplies during states of emergency. 

According to a recent Pennsylvania Health Care Association member survey, 70% of facility respondents said that they use agency staff to fill open positions. Those agencies are “poaching” workers and leasing them back to providers at “exorbitant rates — in some cases, rates are inflated as much as 400%,” the association said.

PHCA President and CEO Zach Shamberg told McKnight’s Senior Living that there are reports that staffing agencies also are taking 40% or more of an individual’s hourly wage, “which means wages are going right into the pockets of agency executives rather than the healthcare heroes themselves.”

Pennsylvania Assisted Living Association Executive Director Margie Zelenak told McKnight’s Senior Living that personal care and assisted living communities need to rely on staffing agencies due to the pandemic-related workforce crisis. Members, however, continually lose out on obtaining staff from these agencies because they are outbid by another health system, she said.

“It is so bad that the temporary agency staff will call off 15 minutes before their scheduled shift because there was a better offer down the road,” Zelenak said.

Read More

mailing Mailing List

Sign up to join our email list and receive updates from PALA.

  • This field is for validation purposes and should be left unchanged.