Members of Congress Urge White House to Investigate Price Gouging From Staffing Agencies

The nursing home sector appears to have picked up a few allies as it continues to look for ways to address price gouging from staffing agencies.

In a letter signed on Monday, Reps. Peter Welch (D-Vt.), Morgan Griffith (R-Va.), and nearly 200 other members of Congress nationwide called on White House officials to investigate nurse staffing agency conduct over the course of the pandemic.

“We are writing because of our concerns that certain nurse-staffing agencies are taking advantage of these difficult circumstances to increase their profits at the expense of patients and the hospitals that treat them,” the letter said. “We urge you to enlist one or more of the federal agencies with competition and consumer protection authority to investigate this conduct to determine if it is the product of anticompetitive activity and/or violates consumer protection laws.”

The letter comes days after the American Health Care Association/National Center for Assisted Living, LeadingAge and a coalition of long-term care and senior living organizations sent a similar letter to White House officials asking something be done to hold these agencies accountable and prohibit them from “taking advantage” of providers.

Nurse staff agencies are charging exorbitant prices to health providers still recovering from COVID with some charging “three or more times pre-pandemic rates” for nursing staff that these facilities desperately need at this time, according to the letter.

As private organizations, nurse staffing agencies aren’t regulated in terms of pricing strategies unless the FTC, or another federal agency, establishes a rule against anticompetitive pricing.

“We thank the members of Congress for sending this letter to the White House, as this has been a huge issue among long-term care providers,” the AHCA/NCAL said in a statement to Skilled Nursing News. “Providers have had no choice but to turn to direct care staffing agencies due to the workforce crisis, and agencies are exploiting the situation by charging exorbitant rates. We implore the federal government to investigate this matter urgently.”

Both pleas were made as the industry has lost 420,000 employees since February 2020, according to LeadingAge.

Though not the first time federal agencies have been called on to address the issue – with the Advancing Excellence in Long-Term Care Collaborative and American Health Care Association both urging the Federal Trade Commission to look into the issue last year – some think this latest push could be just what is needed. 

“I think what you really need is pressure from Congress to make it happen,” Christopher Laxton, Society for Post-Acute and Long-Term Care Medicine (AMDA) executive director, told Skilled Nursing News.

“Estimates of job losses are upwards of over 15%, it’s never been this bad. This has real consequences in terms of nursing homes’ ability to care for the residents in their care,” he added.

Laxton thinks that to best address price gouging from staffing agencies and help fix the staffing shortage the industry currently faces, nursing homes will need more support and limits will need to be established for staffing agencies.

“We need to see both caps placed for staffing agencies to operate within reasonable limits when it comes to nursing homes and have some sort of an incentive so that nursing homes can pay more competitive salaries during this time,” he said.

States have also started to look into the issue with some like Pennsylvania drafting legislation to establish rate caps for staffing agencies.

“The number one thing is rate caps because for providers that are beholden to a Medicaid reimbursement system, this is simply unsustainable. Two, there needs to be oversight,” Pennsylvania Health Care Association President and CEO Zach Shamberg recently told Skilled Nursing News.