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A Pennsylvania nonprofit long-term care provider recently showed its ingenuity by creating an internal staffing agency, or float pool, to cope with staffing shortages and high temporary agency costs. But it’s still losing ground.

The company’s internal agency has still resulted in an additional $1.5 million in staffing costs — payouts it says are “clearly unsustainable.”

Allied Services Integrated Health System opened its own internal staffing agency in Spring 2022 in response to the national staffing crisis that has hit nursing facilities everywhere. The group provides training and continuing education to nursing staff who travel among their own facilities in Northeast Pennsylvania.

In the last 18 months, it has utilized 50,000 nursing hours from 84 hires to meet local needs. That breaks down to 12,000 staffing hours in 2022 and 30,000 hours in 2023 thus far, company officials told McKnight’s Long-Term Care News on Tuesday. Worse, hours and costs are essentially doubling every six months, they explained.

“Unfortunately, it is a model that is unsustainable financially and will break with too much growth, due to the significantly higher wages,” said Carmela J. Fox, Allied’s assistant vice president for human resources. 

$30 per hour aides still not enough

Providers have increasingly turned to creating their own float pools, especially as many tried to escape the even higher costs of external agencies. But Allied Services’ experience shows the concept isn’t a perfect solution.

Allied pays certified nursing assistants who are in its agency up to $30 per hour in base pay, while licensed practical nurses earn up to $50 per hour and registered nurses bring in $70 per hour. Per the employment website Indeed, a CNA in the Scranton area can expect to earn an average base salary of $23.09 per hour; an LPN, an average base salary of $35.27 per hour; and an RN’s average base salary there is $71.75 per hour. 

Allied does not require its staffers to sign contracts to be enrolled in the Integrated Staffing unit. The company guarantees hours and does not ask nursing staff to travel outside of its service area. 

Still, the costs and administrative labor required to operate this float pool may not be sustainable over the long-term, especially with the federal staffing mandate poised to add to the staffing crisis. 

“The outlook is that this temporary agency will need to continue until appropriate funding is provided to recruit and sustain better wages for the majority of our regular front-line workers,” Fox said. 

In July 2022, Pennsylvania boosted Medicaid rates by a historic 17% — approximately $35 more per resident per day. That was cheered by the long-term care sector and aging advocates. But just months later, hundreds of beds throughout the state remained empty as facilities said they couldn’t hire enough staff. The Pennsylvania Health Care Association released its 2023 State of Nursing Facilities Report in March 2023 showing that 57% of responding members have beds they cannot fill due to a lack of staff. The survey found that 31% of responding facilities had 21 or more direct care positions open. 

Tripled payments

Even with the float pool, Allied Services is struggling to find enough workers. 

James Brogna, vice president for Strategic Partnership Development at Allied, told McKnight’s that the $1.5 million it has spent in additional staffing costs so far this year is triple the program’s total cost last year. The staffing hours are also 2.5 times greater than the number of hours in 2022. But there are 50 nursing and CNA positions open in the company’s skilled nursing center in Scranton and dozens more open across its long-term care facilities and transitional rehabilitation units.

“Integrated Staffing was intended to be a temporary solution to a staffing crisis during the pandemic, and instead of disbanding, as expected, we have actually had to grow the program and increase this staff model to help maintain ratios, without the support of government funding,” Brogna said.  

He said Allied remains committed to keeping open all of its skilled nursing beds and ensuring that patients and residents continue receiving the highest quality care that can be provided.

The company recently repurposed personal care rooms — what Pennsylvania calls assisted living — to add 42 private, skilled nursing beds in a facility it acquired in 2019 from the Catholic Diocese of Scranton. The group delicensed 48 personal care rooms in early 2021 and also relocated 42 private, skilled nursing facility dual-licenses from its Scranton campus to Wilkes-Barre (Luzerne County).

“Our staff is our most valuable asset for quality care,” Brogna said. “Our goal is to be able to serve all referrals in need across our community, with our 650 skilled beds. In essence, we have not focused on what referrals we could not take, nor our daily census due to staffing limitations, as we work tirelessly and strive to accommodate all referrals.”