New South Wales doctors are waiting until the last minute to accept temporary positions in under-resourced hospitals because agencies encourage them to take advantage of crisis rates that can be double the normal payment.
Locum doctors make up 1% of NSW Health’s staff and are temporary doctors who can be paid thousands of dollars a day to fill staffing gaps. If a position remains unfilled, the fee offered can become even higher the closer it gets to the date.
Locum roles can be offered at an hourly rate, a shift rate or for 24 hours on call. A locum told Guardian Australia that for certain roles, such as rural generalist 24 hours on call, the rates can double from $2,000 a day to over $4,000 for crisis rates.
Most temporary placements in NSW are filled through the 59 medical recruitment agencies registered with the health department to act as intermediaries between hospitals and doctors.
NSW Greens MP Dr Amanda Cohn, a former rural GP, said it was “extraordinary” that the businesses were “profiting from the workforce shortages that we have in the health sector”. She said private recruitment agencies were incentivised to price gouge as agencies charge a minimum 10% to 15% commission.
“I’m aware of recruitment agents who’ve deliberately withheld the details of available doctors until those hospitals bump up the rates that they’re offering to crisis rates, which in some cases can be double what was initially offered,” she said.
In an email seen by Guardian Australia, a doctor informed a recruitment agency of the range of dates they were available to fill locum positions. The recruitment consultant replied: “we can talk more when there are crisis rates coming in for those dates”.
New South Wales is holding a special commission of inquiry into healthcare funding, which has received multiple submissions calling for NSW Health to directly employ locums rather than source them through external agencies.
NSW Health acknowledged in its submission to the inquiry the costs of locums are “escalating” as the lack of overseas doctors due to the pandemic increased reliance on locums.
A NSW Health spokesperson told Guardian Australia “locum agencies are required to meet standards and conditions for the right contract with local health districts … Fees and commissions are not set in the policy but are determined between districts and agencies under these contracts.”
“In 2020-21 the total locum rates of junior doctors across LHDs was $148m and in 2021-22 was $ 178.8m. This figure does not include agency fees. This represents less than half of one percent of the total NSW Health budget,” the spokesperson said.
Cohn said “At Murrumbidgee, for example, the annual locum spend has ballooned from $30,000 to $1.8m in the past decade” .
The problem worsens over holiday periods, as it became a “seller’s market” when regular staff take time off, and health workers are often offered even higher rates, she said.
Cohn said she has also seen agencies’ contracts stopping doctors from accepting longer or repeated placements in communities, affecting continuity of care.
“The business model of these companies relies on our health system continually having shortages of health workers and offering significant financial incentives to fill gaps at the last minute.” The model is at odds with the health profession’s principle aiming for continuity of care, Cohn said.
The Association of Professional Staffing Companies (Apsco) “stringently denies” such practices among its members, which includes about 25 companies who recruit for permanent and temporary medical roles.
In its submission to the inquiry, Apsco said its members “who constitute the bulk of professional medical recruitment firms across Australia” abide by a strict code of conduct and are subject to vetting and due diligence before being allowed to join.
A submission to the inquiry from the Australian Salaried Medical Officers Federation (Asmof) called on NSW Health to directly employ locums rather than source them through external agencies.
The recommendation was also made by the 2008 special commission of inquiry into acute care services in NSW public hospitals but was never implemented.
The president of the NSW branch of the Australian Medical Association, Dr Michael Bonning, said a register of doctors and nurses “would help to remove any incentive for agencies to manipulate the market” although he said it was “not a panacea”.
Asmof also called for a standardised fee structure for locum doctors to “eliminate bidding wars and promote fairness in locum engagements.”
Apsco’s submission disputed the need for a centralised register, stating “this would see already stretched local health districts/agencies stretched even further, with the very labour-intensive exercise of locum recruitment added to their list of duties.”
Gerard Hayes, the national president of the Health Services Union and the secretary of the NSW branch, said “it should concern all of us that locums can easily command $2,000 per day in regional NSW communities, with many exceeding $60k in a month”.
“This is an expensive way to run a health system and deprives other parts of the system of resources.
“We need additional medical staff to be directly employed in our public hospitals. Doctors can and should earn good money, but they should be paid directly on permanent or long term contracts.”
Do you know more? natasha.may@theguardian.com
