People walk past the main entrance to St. Clare's Mercy Hospital in St. John's on Jan. 11, 2022. In 2022, two of the province’s health regions signed sole-sourced contracts with Canadian Health Labs (CHL), under an emergency exemption clause allowing officials to skip the regular bidding process.Paul Daly/The Canadian Press
Newfoundland has overhauled the way it hires private agency nurses, in the wake of a Globe and Mail investigation that raised questions about the costs and billing practices associated with a Toronto company that supplied out-of-province temporary nurses in Atlantic Canada.
New standards unveiled by Newfoundland and Labrador Health Services (NLHS) include preset hourly rates, tighter rules for expense claims and the abolition of meal allowances.
Details were outlined in a request for proposals NLHS posted Wednesday on MERX, the online bidding platform for government procurement contracts.
Newfoundland didn’t rely heavily on temporary nurses, also known as travel nurses, until the pandemic worsened staff shortages. As a result, in 2022, two of the province’s health regions signed sole-sourced contracts with Canadian Health Labs (CHL), under an emergency exemption clause allowing officials to skip the regular bidding process.
CHL charged up to $283.63 an hour for general registered nurses and $312.25 for specialty nurses, roughly six times what a staff nurse typically earns in the public system.
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According to bidding documents posted on MERX, Newfoundland has a standing offer to hire private agency nurses for a two-year term, with the option to extend for another two years. NLHS will pay a $110 hourly rate for registered nurses and $125 for specialty nurses.
The new fee structure also caps travel expense claims at $1,500 for an individual’s return trip. A Globe review of CHL invoices found that the company asked to be reimbursed for sums as high as $5,349 for an individual nurse’s one-way travel to Newfoundland.
Furthermore, NLHS will no longer provide per diems. The Globe investigation found that CHL invoiced Newfoundland for more than $2.2-million in daily meal allowances for its nurses while telling its workers that they had to pay for their own food. The company has not answered requests to explain the discrepancy.
In a statement, NLHS human resources vice-president Debbie Molloy said that the new standards, which also include using a list of approved agencies, will ensure provincewide consistency when contracting private health care staff.
The MERX post said that, while the short-term focus of the bid is hiring agency nurses, “other health care professionals could also be considered over time.”
Union leaders criticized the new standards, saying that they further cement the reliance on private providers in the public health care system.
“We have been here before. Time and time again the government tries to implement the privatization of our public services under the guise of saving money or streamlining services,” Jerry Earle, the president of the Newfoundland and Labrador Association of Public and Private Employees, whose members include 11,000 front-line health care workers said in a statement sent to The Globe.
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Yvette Coffey, president of the Registered Nurses’ Union Newfoundland & Labrador, said the new arrangements will only benefit private agencies. “This is the wrong direction and is the exact opposite of the promise of NLHS to have a plan to phase out private agency nurses. This standardization plan that NLHS is now announcing will entrench the use of private agency nurses and erode our public health care system,” she said in a statement.
CHL’s two nursing agreements in Newfoundland expired this spring. Provincial Auditor-General Denise Hanrahan is now investigating contracts between private vendors and the province’s health sector, citing The Globe’s reporting on the CHL nursing deals.
CHL also signed three contracts in New Brunswick, which have been reviewed by the province’s Auditor-General Paul Martin. His report released in June was critical of the exorbitant fees, questionable invoices and lack of oversight associated with those arrangements.
CHL didn’t respond to a request for comment on Wednesday. The company has said in past statements that its contracts feature “competitive hourly rates,” are “fair and transparent” and reflect the “extraordinary logistical challenges” of recruiting and retaining health care workers in rural Canada