Staffing agencies date back to World War II in the 1940s—decades before the development of the internet. Since then, healthcare managers and schedulers have become accustomed to picking up the phone and dialing staffing agencies for help with sourcing both temporary and permanent staff.
However, in the Internet Era, are staffing agencies still necessary, or have they become obsolete?
Healthcare staffing agencies: An overview
Healthcare staffing agencies are companies that match nurses and other medical professionals with jobs in long-term care facilities, hospitals, clinics, and other settings.
How do healthcare staffing agencies work?
Agencies typically offer healthcare facilities the following staffing services:
- They recruit and screen potential candidates.
- They check candidates’ credentials and references.
- They match candidates with appropriate job opportunities based on their skills and experience.
- They pay the clinicians and handle employment-related responsibilities, such as taxes and benefits (when applicable).
- For travel nursing contracts, staffing agencies typically also arrange for transportation and housing.
For these services, staffing agencies charge additional fees on top of the agency clinician’s pay.
Agency nurses and other healthcare professionals may work for staffing companies as W-2 employees or 1099 independent contractors. W-2 workers receive employee benefits, such as health insurance and paid time off, whereas 1099 workers don’t receive these benefits but typically receive higher hourly pay.
Staffing agencies may have a mix of W-2 and 1099 workers, typically preferring employee status for medium- to long-term contracts and independent contractor status for per diem, PRN, and some short-term contracts.
Healthcare facilities may rely on staffing agencies for a variety of contract lengths:
- Per diem or PRN contracts: Typically, one shift at a time
- Temporary or short-term contracts: Generally, up to 13 weeks
- Travel nursing contracts: On average, 13 weeks long
- Medium-term contracts: Usually, from 13 weeks to six months
- Long-term contracts: Generally, six months to one year
- Permanent positions: Indefinite duration
Pros and cons of agencies for healthcare staffing
Agencies have long been a go-to staffing strategy for healthcare facilities. There is no question that agencies do provide solutions to many nurse staffing needs.
The question is, however, whether the services that nurse staffing agencies provide are worth the drawbacks that come with them or whether they are, in effect, obsolete.
Pros of staffing agencies
The advantages of staffing agencies boil down to the services they offer:
- Providing staffing options for various contract lengths
- Ensuring candidates are qualified for the positions they will cover
- Handling worker compensation and benefits
Cons of staffing agencies
Unfortunately, facilities must pay a high price for these services and often have to endure long wait times—not to mention that the healthcare workers whom agencies assign are often unsatisfactory for facilities, if only because facilities typically have little involvement in the selection process.
Here is a more detailed breakdown of the most significant disadvantages of relying on staffing agencies:
- Ineffective for emergency staffing: Staffing agencies typically do not prioritize per diem contracts since these generate the smallest income. Therefore, agencies are not effective for covering last-minute call outs or no-shows.
- Time consuming: Agencies are middlemen. Therefore, relying on agencies naturally involves a significant amount of back-and-forth communication and paperwork, all of which takes time.
- Expensive: Elevated costs are perhaps the most significant drawback of relying on staffing agencies. With nursing costs being one of the main drivers of margin pressures, facilities must find ways to reduce staffing costs while maintaining compliance with state and federal regulations.
When are agencies a good option?
Staffing agencies are useful when facilities need to fill a highly specialized role or need full-time coverage. In addition, for facilities that are unworried about cost or flexibility and simply want a more full-service type of support, staffing agencies allow them to be almost entirely hands-off for the process.
However, staffing agencies are practically obsolete when it comes to filling last-minute gaps. Better alternatives exist for recruiting nurses and other healthcare professionals for long-term/permanent positions.
Alternatives to traditional healthcare staffing agencies
With staffing platforms, social media platforms, job boards, and facilities’ own websites, there are countless modern alternatives to agencies for meeting facilities’ staffing needs.
Hiring full-time staff
Healthcare facilities should have a solid base of full-time in-house staff.
Internal staff members are familiar with a facility’s policies and procedures and can even be crucial players in a facility’s improvement efforts, such as taking part in shared governance committees.
Experienced internal staff are also invaluable as nurse preceptors or mentors, assisting new nurses during orientation—not to mention the importance of providing expert patient care.
In addition to sourcing permanent clinicians through agencies, facilities can post openings on their own websites or offer permanent positions to per diem clinicians they meet through online platforms.
Travel nurses
Although it is common to source travel nurses through agencies, facilities can source travel nurses independently, securing significant savings by avoiding steep agency fees.
Independently sourced travel nurses are excellent alternatives for short- to medium-term agency placements. As with agency staffing, finding the right travel nurse independently also takes time. Therefore, this staffing option is ideal for foreseen gaps in clinician coverage, such as planned staff absences or periods of typical surges in patient census.
Per diem nurses
As with the previous alternatives, per diem nurses may also be sourced independently, without relying on agencies as middlemen. PRN staffing platforms facilitate this by leveraging technology.
For example, Nursa allows facilities to source clinicians directly, much like someone might select an Uber. In this way, facilities can fill a gap in coverage within minutes. Healthcare managers are also able to view clinician profiles to choose the right person for the job and even message them directly.
Staffing agencies vs. healthcare staffing platforms
It may be understandably hard for facility managers accustomed to agency staffing to switch to online platforms. However, healthcare staffing platforms can offer facilities the same services as agencies do at a fraction of the cost, among other advantages.
Clinician quality
Both agencies and staffing platforms run background checks on clinicians and verify their licenses before allowing them to pick up jobs.
Similarly, both staffing agencies and platforms allow facilities to customize their job requirements, including the level of licensure, experience, certifications, etc.
Unlike nurse staffing agencies, Nursa allows facilities and clinicians on the platform to message each other directly. In this way, facilities can ask clinicians any additional questions they may have before accepting their job request.
Furthermore, facilities can rate clinicians who have worked with them, providing valuable information to other facilities interested in sourcing that nurse or other healthcare professional.
Candidate pool
As is the case with staffing agencies, Nursa allows facilities to find coverage for a variety of positions, including the following clinicians:
- Registered nurses (RNs)
- Licensed practical/vocational nurses (LPNs/LVNs)
- Certified nursing assistants (CNAs)
- Respiratory therapists (RTs)
- Caregivers (CGs)
- Medications aides
Unlike agencies, Nursa allows facilities to post shifts and clinicians to request shifts in real time.
With over 300,000 clinicians on the platform, Nursa offers facilities a deep pool of local talent who can potentially fill shifts.
Staffing costs
In general, staffing through agencies can be more costly than through platforms. However, the difference is most evident when it comes to hiring healthcare workers for permanent positions.
Agencies typically charge up to 25 percent of a nurse’s annual salary as payment for finding a permanent placement. In a state like California, where the average annual RN salary is $148,330, an agency’s hire-away fee for a single RN could amount to over $37,000.
In contrast, Nursa doesn’t charge any hire-away fees. Facilities are free to offer clinicians from the platform permanent positions free of charge.
Pricing transparency
With Nursa, facilities can avoid the endless back and forth and long paper trail that agency staffing typically implies.
Facilities approve pricing before posting a shift on the platform and can even set the bill rate themselves. There are no hidden fees or additional costs for mileage, travel, or overtime.
Furthermore, billing is completely transparent. Facilities on the platform benefit from all of the following:
- Up-to-the-minute balance summaries
- Safe and secure access to their billing and payment activity
- Fast, flexible payments via ACH, credit card, or bank transfers
- Detailed access to invoice-level payment summaries, credits, and shift report history
- An AutoPay option to further streamline the process
Scheduling
Not only can facilities post shifts and accept shift requests on Nursa in real time, but healthcare managers and schedulers can also add clinicians to a Favorites list and turn on the Auto-Schedule feature to automatically schedule clinicians for future shifts they request.
In this way, scheduling a per diem nurse for a shift could take no more than the 30 seconds it would take a scheduler to post the opening.
Long-term recruitment
As mentioned, facilities have better options for recruiting nurses for permanent positions than relying on staffing agencies.
After signing a nurse recruitment contract with an agency, facilities typically have to wait eight to 12 weeks before the position is filled—not to mention having to pay the hefty agency fees.
Although facilities typically consider healthcare staffing platforms for per diem nursing coverage, Nursa is an excellent alternative for long-term recruitment as well. Not only can facilities automatically schedule favorite clinicians for future shifts, but they can also offer these trusted clinicians permanent positions—without paying hire-away fees.
Facilities can use Nursa to “try out” clinicians during per diem shifts, using this time to assess whether the clinician would be a good fit for the facility in the long term.
The bottom line: Are healthcare staffing agencies a good option?
The bottom line is that with staffing shortages in healthcare causing significant nurse scheduling challenges, healthcare facilities should be open to exploring a variety of flexible staffing options.
Ideally, facilities should have a solid base of full-time employees and rely on healthcare platforms for contingent staffing needs and to test potential candidates for permanent positions. Although their benefits compared to the available options are waning, there is still a time and place for staffing agencies, particularly for recruiting highly specialized clinician roles.
When it comes to staffing, the more options the better.
Learn more about how Nursa helps healthcare facilities, hospitals, and health systems solve staffing needs.
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