Lawmakers ask White House to investigate price gouging by nurse staffing agencies

Hospital leaders have complained about the high costs charged by nurse staffing agencies, and now members of Congress are asking the White House to investigate the possibility of price gouging.

U.S. Reps. Peter Welch, D-Vt., and Morgan Griffith, R-Va., wrote the letter, which was signed by nearly 200 lawmakers representing the Democratic and Republican parties. They sent the letter to Jeffrey Zients, coordinator of the White House COVID-19 Response Team.

“We are writing because of our concerns that certain nurse-staffing agencies are taking advantage of these difficult circumstances to increase their profits at the expense of patients and the hospitals that treat them,” the Jan. 24 letter stated.

“We urge you to enlist one or more of the federal agencies with competition and consumer protection authority to investigate this conduct to determine if it is the product of anticompetitive activity and/or violates consumer protection laws.”

With hospitals facing waves of COVID-19 patients over the past two years, many systems have turned to nurse staffing agencies. Some hospitals have become especially reliant on staffing agencies as nurses have resigned during the pandemic.

The American Hospital Association said it has urged the Federal Trade Commission to investigate if price gouging is happening. On Thursday, the AHA joined with the American Health Care Association/National Center for Assisted Living to urge the White House to look into the pricing practices of staffing agencies.

"Our organizations have no choice but to pay these exorbitant rates," the groups said in a joint letter, adding the costs are not sustainable for hospitals and nursing homes.

Melinda Hatton, the AHA’s general counsel, said in a media call Tuesday the group first raised the issue with the FTC last year, since the commission has anti-trust authority and consumer protection authority.

The hospital association has heard reports that nurse staffing agencies are charging hospitals two or three times more than they did before the COVID-19 pandemic, Hatton said in the media call.

“It’s fair to investigate whether these companies are price gouging,” Hatton said.

“I think you can argue this is an even more important resource than some areas they investigated,” she added. The AHA did not mention any staffing agencies by name.

In the letter, lawmakers echoed some of the concerns of the hospital association.

“We have received reports that the nurse staffing agencies are vastly inflating price, by two, three or more times pre-pandemic rates, and then taking 40% or more of the amount being charged to the hospitals for themselves in profits,” the letter stated.

"We have heard the amounts charged to hospitals rose precipitously as the newest wave of the COVID-19 crisis swept the nation and the agencies seemingly seized the opportunity to increase their bottom line.”

Some of the lawmakers who signed the letter include U.S. Reps. Liz Cheney, R-Wyo., Charlie Crist, D-Fla., Ilhan Omar, D-Minn., and Elise Stefanik, R-N.Y., the chairwoman of the House Republican conference. In addition, six lawmakers who are also doctors signed the letter.

In the letter, lawmakers accused nurse staffing agencies of also charging exorbitant prices in the early days of the COVID-19 pandemic.

Healthcare organizations have said they are dealing with serious labor shortages on top of the surge of COVID-19 patients. Some leaders have said they’ve lost nurses due to early retirements or family reasons. But some hospital leaders have said they are losing nurses for more lucrative pay at staffing agencies.

Nurses have said they’ve been overwhelmed and exhausted during the pandemic and some have faulted healthcare organizations for not doing enough to support them. In addition, 40% of nurses say they plan to leave their jobs in the next two years due to the stress they've experienced in the pandemic, according to a study published in Mayo Clinic Proceedings.

The American Hospital Association is pressing Washington to provide billions more in aid to deal with the costs of treating COVID-19 patients.

In November, U.S. Sens. Mark Kelly, D-Ariz., and Bill Cassidy, R-La., sent a letter to the White House asking for an investigation into the "extreme prices being reported for nurse staffing agencies from hospitals in our states."