Record revenue for staff agencies supplying NHSon March 24, 2023 at 5:00 pm

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Companies thrive as the health service struggles with staffing gaps and increased patient demand.

Nurses with patient in hospitalImage source, Getty Images/VM

Companies providing freelance staff to the NHS to cover for big shortages of doctors and nurses have seen their income rise by tens of millions of pounds since 2019.

Two companies, amongst the largest providing workers to the NHS, saw their turnover rise by 80% and 77.5%.

BBC News looked at the financial records of about 20 agency businesses providing services in the UK.

Health leaders say staff shortages mean they have to spend on freelance cover.

And the following month, a Freedom of Information request by Labour revealed one hospital had paid £5,200 for a single shift by a freelance doctor.

In the latest financial records seen by BBC News, Medacs Healthcare, “the largest supplier of locum doctors to the NHS”, reported an 80% increase in sales, to £160.9m, between 2019 and 2021.

Turnover of agency firms

“We’re proud to partner with the NHS to provide them with a round-the-clock supply of flexible healthcare workers,” the company said.

“Our fees are fixed and capped by the NHS and government-approved frameworks we work through.”

ID Medical, which says it is the largest UK provider of healthcare professionals to the NHS, reported a turnover of £145.4m in 2022, up 15% on 2019. It paid one director more than £800,000 last year.

The company said it worked within NHS agreements, adding: “We continue our commitment to driving costs down further In partnership with the NHS, through our broad range of long-term sustainable solutions.”

Both Medacs Healthcare and ID Medical refused to reveal what proportion of their business was with the NHS.

Independent Clinical Services, which trades as Thornbury Nursing Group and Scottish Nursing Guild, reported a turnover of nearly £273m in the 2021 financial year, up 77.5% on 2019, of which, it says, the NHS accounts for less than half.

“We recognise the strain the NHS and other care providers are under and proactively work with customers to support strategic, longer-term workforce provision,” ICS said.

And it had “played a crucial role in supporting care providers during the pandemic”.

ICS is controlled by Acacium Group, registered in Jersey, which, in turn, is controlled, through an investment-fund structure, by a Canadian-headquartered investment company, the group’s ultimate parent.

Demand outstripping supply

Hospitals need freelance doctors and nurses to fill gaps in rotas – but demand for patient care is now outstripping the supply of staff, health leaders say, which is why agency bills have increased.

Sir Julian Hartley

Sir Julian Hartley, chief executive of NHS Providers, representing trusts, and a former hospital boss himself, said: “These figures underline the current challenge in terms of the cost of agency staff for trusts.

“All trusts are desperate to reduce those costs and indeed reduce the reliance on agency staff.”

Sir Julian said the NHS was facing major challenges:

  • recovering from Covid
  • reducing backlogs
  • difficulties discharging medically fit patients, due to delays in community care

The cost of agency staff was a “major factor for NHS organisations who want to see a much more sustainable approach”. Less should be spent on agency provision and more converted into permanent staff.

In England, trust leaders are allowed to pay a maximum of 155% of normal staff rates for any agency replacements – unless paying more is the only way to maintain safe staffing levels

There are also official NHS flexible staff banks which place health workers with employers who need to fill temporary gaps.

A Department of Health and Social Care spokesperson said: “While temporary staffing allows the NHS to meet fluctuations in demand, we are controlling spending by capping hourly pay, prioritising NHS staff when shifts need filling and hiring agency staff through approved NHS frameworks to ensure value for money.

“We will soon publish a long-term workforce plan to ensure we have the right numbers of staff, with the right skills to deliver high quality services fit for the future.”

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