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Tired of turnover? Blocked by burnout? Dried-up hiring pipeline?
If you’ve already got staffing headaches, the last thing you want to hear is that 40% of nurses are planning to leave or retire in the next 5 years.
Healthcare providers are under pressure to become increasingly innovative to keep their bedside rosters full.
So, are traditional solutions like nurse staffing agencies defunct?
Read on to find out the true value and real limitations of staffing agencies. We’ll break down what the agency markup actually covers, what will still be left on your plate to manage, and if there are more effective ways to fill that darn empty shift.
What do nurse staffing agencies do?
A nurse staffing agency, sometimes called a healthcare staffing agency, recruits nurses, verifies their credentials, and places them at facilities that need coverage.
Recruiting occurs through job postings, career fairs, and partnerships with nursing schools, and candidates typically undergo license verification, background checks, and skills assessments before becoming eligible for placement.
Facilities can typically choose from several placement types depending on how long they need coverage:
- Per diem staffing fills single open shifts on short notice.
- Travel nursing places a nurse on a multi-week or multi-month contract, often for a specialty or a facility outside their home market.
- Temporary staffing covers a defined project or leave period.
- Temp-to-perm placements let a facility trial a nurse before extending a permanent offer.
In most of these arrangements, the agency remains the nurse's employer of record. It handles payroll, tax withholding, and (where offered) benefits, while the facility directs the nurse's day-to-day work.
How do staffing agencies charge facilities?
This is often the least transparent part of an agency relationship, and one of the most useful things to understand before signing anything.
A facility pays the agency a bill rate for each hour worked. The nurse receives a pay rate, which is lower than the bill rate. The spread between the two, sometimes called the nurse staffing agency markup, covers the agency's cost, including:
- Recruiting and credentialing costs
- Payroll taxes
- Workers' compensation
- Professional liability coverage
- Margin
That gap between pay rate vs. bill rate is standard across the industry and is not, by itself, a red flag. What varies greatly is how transparent an agency is about it.
Many facilities have no idea what share of the bill rate actually reaches the nurse, and asking for a breakdown is a completely reasonable request during vetting, not an adversarial one.
For typical markup ranges and the factors that drive them, see our breakdown of healthcare staffing agency costs.
What are you actually buying from an agency?
Paying a premium above a nurse's direct wage buys a facility several things it would otherwise have to build itself:
- Recruiting capacity
- Credentialing and background-screening pipeline
- Employer-of-record liability transfer
- Insurance coverage
For a facility without the infrastructure to do all of that in-house, those are real costs avoided, not just a markup absorbed.
What does not change, no matter which staffing model a facility uses, is responsibility.
Facilities still have to verify that any clinician working in their building is actually qualified for the assignment, provide orientation to facility-specific protocols, and supervise the care being delivered. Agency staffing is often misunderstood as transferring more of that responsibility than it actually does, and that is important to clarify before, not after, a nurse is at the schedule.
Why do facilities use staffing agencies?
A handful of recurring pressures drive most facilities toward agency staffing:
- A staffing agency can fill a role quickly during a national or regional nursing shortage, when a facility cannot source candidates fast enough on its own.
- High turnover in nursing roles means some units need a continuous supply of coverage just to stay at baseline staffing.
- Sudden census increases, such as a seasonal respiratory surge, a unit expansion, or a cluster of staff leaves happening at once, can outpace what internal recruiting can absorb.
- Many facilities prefer a hands-off recruitment process altogether, and outsourcing that function lets leadership focus on patient care instead of the administrative burden of hiring.
- The range of placement options, from single per-diem shifts to travel contracts to temp-to-perm arrangements, allows a facility to tailor the model to the gap it faces.
What should you evaluate before signing with an agency?
Choosing a nurse staffing agency comes down to a short list of things worth verifying up front:
- Rate transparency: Ask whether the agency will provide a bill rate breakdown on request.
- Credentialing workflow: Confirm whether screening happens once at onboarding or continues throughout the placement.
- Survey readiness: Confirm the agency can produce credentialing documentation for a surveyor without delay.
- Clinical matching: Ask how closely a nurse's experience aligns with the specific unit and acuity level.
- Replacement policy: Clarify what happens, contractually and practically, if a placement is not working out.
- Fill rate history: Ask whether the agency has filled shifts reliably in your specific market and specialty.
Contract terms, including guaranteed hours and cancellation notice windows, also warrant a close read before signing, as do the financial implications if a contract nurse staffing arrangement ends early.
How does agency staffing work in skilled nursing facilities?
Agency staffing involves a few dynamics in long-term care that hospitals do not address in the same way.
- First, agency staffing for nursing homes is not invisible overhead. Agency hours worked in a skilled nursing facility must be captured in Payroll-Based Journal (PBJ) reporting, which feeds directly into the staffing domain of the Centers for Medicare & Medicaid Services (CMS) Five-Star Quality Rating System.
- Second, margins in long-term care tend to run thinner than in acute care, which changes the math on how much sustained agency spending a facility can absorb before it affects the bottom line.
- Third, continuity of care matters more for long-stay residents than it typically does for a hospital admission measured in days. Rotating agency coverage, where a resident sees a different nurse every shift, carries a quality cost that the hourly bill rate alone does not capture.
What are the alternatives to staffing agencies?
Three models compete directly with traditional agency staffing, and each trades off differently against it.
- Direct hiring builds a stable, long-term workforce and gives a facility full control over who joins the team, at the cost of a longer time to fill any given opening.
- Internal float pools deploy a facility's own cross-trained nurses across units as needed, which avoids external fees entirely but requires the facility to build and maintain a flexible internal team.
- Per diem marketplaces work differently from both. Instead of receiving a placement chosen by an agency, facilities select clinicians directly. They pay for shifts actually worked rather than committing to contracted hours, and many don't charge a hire-away fee if a per diem clinician turns out to be a good fit for a permanent role.
For larger health systems managing staffing across multiple vendors simultaneously, managed service providers (MSPs) offer a separate procurement layer that consolidates multiple agency relationships under a single contract.
Is a staffing agency right for your facility?
The honest answer is that it depends on the shape of the gap you are trying to fill.
A traditional agency tends to be a good fit for facilities that need sustained coverage over a defined period, lack internal recruiting or credentialing capacity to build from scratch, are trying to fill a hard-to-source specialty, or want a single vendor to be accountable for a placement.
A per diem marketplace platform suits facilities with variable, short-term gaps. It allows managers to select clinicians directly, avoid rigid hour commitments, and retain the option to hire proven talent.
Many facilities use both models at once, matched to the situation.
Match your staffing approach to your needs
You want to know a secret?
There is no single staffing solution for your facility.
Many facilities now adopt a mix of methods, including direct recruitment, agencies, internal float pools, and per-diem staffing. This hybrid approach allows you to maintain flexibility and control over your scheduling and budget.
For filling urgent gaps and short-term vacancies, you can solve the problem with just a few clicks on a per diem staffing platform.
With Nursa, you choose from the clinicians who request your shifts. Clinicians on Nursa work as independent contractors, so there's no agency acting as employer of record.
Find out more about how Nursa can fit into your staffing plan.
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