Lawmakers could introduce legislation as early as this week that would regulate temporary staffing agencies and set maximum pay rates for agency healthcare personnel in Pennsylvania.
Contract healthcare service agencies providing temporary employment in nursing homes, assisted living residences and personal care homes would have to register with the Department of Human Services as a condition of operation under a bill being shopped for co-sponsors by State Rep. Timothy Bonner (R).
Should it eventually pass, Pennsylvania could become the third state to cap agency pay rates amid a nationwide push from providers seeking relief from what they call anti-competitive behavior from temporary staffing firms.
Bonner’s proposal follows months of behind-the-scenes advocacy by nursing home operators and the Pennsylvania Health Care Association, which said Friday that the cap component could help stop pandemic-era price gouging and the poaching of facilities’ own employees.
Although a draft of the bill was not yet available, PHCA President and CEO Zach Shamberg told McKnight’s its rate-setting process would probably mirror those of states with existing caps and be based on median wage rates in relation to position, geographic location, shifts and schedules. A state agency would oversee and regulate the process.
“We continue to see agency staffing rates soar to new heights, even as Medicaid reimbursement rates remain stagnant,” Shamberg said. “Our providers in Pennsylvania have made it clear: The industry can no longer wait for a federal solution or regulatory effort. Pennsylvania leaders must act now on behalf of long-term care providers, workers, residents and taxpayers throughout the commonwealth.”
The long-term care industry’s two major national associations have asked the Federal Trade Commission to investigate anti-competitive practices within the industry.
The American Health Care Association/National Center for Assisted Living said several state associations are working to illustrate the challenges to their federal representatives or seeking state-level fixes. Only Massachusetts and Minnesota currently place caps on staffing agencies, but nearly all states are reporting agency-related challenges amid the worst workforce crisis the industry has faced.
In Iowa, for example, AHCA said estimates have shown 60% of nursing homes are relying on temporary staff agencies, and the base agency hourly rate has increased as much as 40% since just last year.
But the issues go beyond pay.
“Staffing agencies … are now recruiting our frontline caregivers and leasing them back to providers with outlandish wage markups. They’re charging two, three or four times the average amount for a CNA, LPN and RN. And most importantly, they are disrupting the continuity of care for our vulnerable residents,” Shamberg said. “There is a place in the long-term care continuum for direct care staffing agencies, but their service should not come at the expense of jeopardizing care for the residents they are hired to serve.”
The Pennsylvania bill would increase oversight of agencies in some 700 nursing homes and 1200 assisted living residences and personal care homes.
“This proposed legislation would place registration requirements on healthcare service agencies operating in long-term care facilities, as well as require a system for reporting and establishing penalties,” Bonner wrote in a co-sponsorship memo. “The Commonwealth is a principal partner in the long-term care continuum, and these excessive hourly rates charged by supplemental healthcare service agencies are draining the already-underfunded Medicaid program and taking valuable dollars away from full time employees and resident care.”