Nursing Homes Use of Staffing Agencies Soars During Pandemic as Workforce Crisis Deepens

Nursing Homes Use of Staffing Agencies Soars During Pandemic as Workforce Crisis Deepens

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An increasing number of skilled nursing facilities have had to depend on staffing agencies, and find other alternative ways to fill shifts, during the height of the pandemic and into this year.

Operators have historically tried to use agencies as a last resort because of additional fees associated with the service; residents need to see familiar faces too, and staff that are on the floor every day will be more confident in what patients and co-workers need.

But the pandemic forced operators to take on extra help when staff members either left the workforce due to increased strain on operations, or became ill with COVID-19 themselves. Now, they are continuing to rely on agency workers due to pandemic-related burnout among full-time staff and labor pressures tied to worker shortages, industry leaders told Skilled Nursing News.

SmartLinx, a workforce management solutions company, found that (of its clients) the number of shifts allocated to agency staff is up 154%, from 145,423 in 2019 to 370,740 in 2020. For this year, shift allocation is sitting at 218,589 and is on pace to increase year over year again.

Usage of staffing agencies has fluctuated over the past several years — the number of SmartLinx operators utilizing agencies went from 101 in 2019 to 103 in 2020, then back down to 78 so far this year.

That’s for operators typically running more than one facility, Lynne Jackson, senior content marketing manager for SmartLinx, told SNN.

Staffing pressures are certainly being felt well beyond the SmartLinx client pool: Ninety-four percent of SNF operators say they have experienced continuing staff shortages into this year, and 75% say the issue has worsened compared to 2020, according to a June survey conducted by the American Health Care Association and National Center for Assisted Living (AHCA/NCAL).

“It’s gotten to a point where everybody is using outside staffing, way more than they did [pre-pandemic],” said Charles Turner, chief executive of digital labor marketplace Kare. “People are afraid because of the pandemic … they’re just going to exit if they haven’t already, they’re going to exit the industry.”

After analyzing data from thousands of Kare users, Turner estimates that the skilled nursing space will still lose about 15% of the permanent workforce due to pandemic burnout.

Agency aversion

Staffing agencies in the skilled nursing space have a certain stigma attached to them for obvious reasons — if you’re working in long-term care, building relationships over time with residents can be crucial to their wellbeing and quality of life.

Introducing temporary staff into the LTC environment strains these relationships.

“The industry has always used agency [staffing] at some level. If you talk to providers, their goal is to not use agency, because it has an impact on staff morale, it has an impact on quality, it has an impact on resident satisfaction; somebody who comes into a building to work a shift doesn’t know the policies, procedures, the residents,” said Mark Woodka, CEO of staffing software company OnShift.

The Cleveland-based business partners with operators to provide time and attendance software, but also has service lines tied to recruiting staff, employee engagement and workforce analytics.

There are financial reasons for operators to avoid agency staffing as well. Agency fees will cost operators one-and-a-half to two-times the hourly rate, OnShift’s CEO said.

“A provider would rather give overtime to their permanent staff than pay agency fees, because it’s less costly, and the money goes to their employees,” added Woodka. “But at some point, employees started really getting burned out during COVID … people are now more cognitively leveraging agencies to give their staff a break, while they try to hire more staff to fill the roster.”

The costs of agency staffing can be difficult to bear for SNFs at any time, given the low margins that are typical in the industry. However, now is a particularly challenging period financially for many operators, given elevated expenses and drastically lower census throughout the pandemic.

Further financial support should be coming soon from the federal government, REIT executives recently said. But with each day that goes by, operators are in a tighter situation, prompting them to seek solutions such as rent deferrals from their landlords.

Staffing creativity

Options to fill shifts have broadened as operators get creative, Woodka continued, referring to in-house networks supported by online platforms and made up mostly of part-time caregivers.

Operators need to go beyond direct hires and traditional agencies to stem the staffing crisis, he added.

“Our multi-facility providers are creating internal float pools, almost [like] internal agencies, where they’re hiring people to work in one of a number of buildings,” said Woodka. “Instead of working in a building, I might have five buildings in Cleveland. I hire people to work in a float pool, and I’ll tell them the week before what building they’re going to work in.”

The idea is that the staffing pool helps operators reduce risk — floating workers fill shifts fast without having to bring in an agency staff person.

“You don’t know who you’re getting when you ask for an agency employee, so the network model, having a network to tap into [gives you] more known quantities. There’s more trust there,” Woodka said.

Other skilled nursing providers turn to companies like Houston, Texas-based Kare, which uses an online platform to connect workers with facilities. The digital worker platform was born from staffing frustrations linked to Hurricane Harvey.

“We prequalify all these folks to come in, and it gives any community access to hundreds of thousands of workers that they wouldn’t already have access to, at a price that is far less than agency in most cases, far less than paying ground staff over time,” explained Kare’s Turner.

Skilled staff, including LPNs and CNAs, set wages themselves through the digital marketplace; operators can hire from the marketplace with no fee, Turner said, arguing this is a game changer for facilities that have had to turn to agencies in the past.

“We know this labor force — they want to stay in this industry. The data is telling us that they want to stay in this industry but they also want to make more money,” explained Turner. “They’re still gonna pick up the shift with [a participating operator] and the free time with us versus having another permanent or semi-permanent job that may conflict with their primary job; it offers greater flexibility for that workforce.”

An unlikely worker pool, recruiting tools

Schedule flexibility is one tool operators can take from the pandemic and incorporate going forward, Woodka said. More providers found ways to offer flexible shifts after nursing home workers suddenly found themselves stuck between long shifts and a day broken up with family and school activities now taking place at home.

This echoes what Turner is seeing with Kare’s clients — a need for flexibility, the ability to choose shorter shifts and have more control over their day.

“People that normally work, let’s say a standard four-two rotation, which is four days on, two days off, suddenly needed to be home for three straight days to help their kids with school,” explained Woodka. “A lot of the providers got adaptable in providing flexibility, which had two benefits: one, it helped them cover shifts without resorting to the excess costs of agencies … it also opened up their hiring pools because there are people that want to work in the industry that can’t work a regular rotation, or need more flexibility in their schedule.”

Semi-retired workers looking for short shifts might be the perfect fit for operators looking to fill odd hours, Woodka said, and he hopes this flexibility will stick around long after immediate effects of the pandemic are gone.

Using marketing dollars to recruit this demographic is something operators should look into, if they haven’t already, the OnShift exec said.

“That’s just starting to happen, towards the tail end of COVID. Coming into this year, we’re starting to see those flexible models play out more, and see a lot more interest by providers in deploying those kinds of models,” noted Woodka.

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