N.B. auditor general finds $173 million in travel nurse contracts 'did not demonstrate value for money'

New Brunswick’s auditor general says the province’s travel nurse contracts signed over a two-year period were riddled with problems and risks.

Paul Martin released his report into the matter Tuesday, after promising to look into the contracts back in March.

Martin’s audit found that there was a lack of "data-drive decision-making, no vendor-selection processes, and no proper contract development, management or oversight."

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He also said that Vitalité Health Network did not provide his office with requested information, which is in contravention of the Auditor General Act.

Between the two health authorities – Vitalité and Horizon – and the Department of Social Development, the province spent $173 million in travel nurse contracts between Jan. 1, 2022 and Feb. 29, 2024.

Vitalité’s CEO, Dr. France Desrosiers, has said some hospital beds were on the verge of closing because of lack of staff and that these contracts stopped that from happening.

In February, Desrosiers said the health authority was “at a crossroads” by the summer of 2022, with level of care hours per patient at a critical point.

“This temporary but necessary measure allowed us to save lives, relieve our staff by reducing team exhaustion and turnover,” she said.

At the time, Desrosiers confirmed it will be winter 2026 before Vitalité will be able to completely phase out the need for these contract nurses. The health authority spent $123 million, while Horizon spent just under $48 million. The Department of Social Development spent $2.9 million.

Horizon Health has said it is preparing to phase out its need for travel nurses by the summer.

“Our audit work concluded that the contracts with private nursing agencies were not reflective of best practises and did not demonstrate value for money,” reads the audit.

The audit outlines how much pricing varied between companies. It found that Canadian Health Labs charged “significantly more” than the others.

In two contracts, that company charged Vitalité Health $18,043.42 a day (12 hours) for a team of five in-person staff members, including three registered nurses and two licensed practical nurses, as well as two virtual staff members. Broken down, that’s about $306/hour for each in-person staff member, according to the audit.

New Brunswick registered nurses are paid between $36.41 and $46.13/hour.

Vitalité spent $93 million on contracts with Canadian Health Labs.

Paula Doucet, president of the New Brunswick Nurses Union, said nurses would compare what they were being paid, calling it demoralizing.

“This company came in on their white horse to say that we're going to save you. However, they bled us dry,” she said. “And this is taxpayer dollars that could have been redirected into our own communities within our province."

The audit also found risks within the contracts.

Several contracts did not have an end dates, or spending caps. The report also noted that the Department of Social Development “did not request or receive copies of criminal or vulnerable sector checks pertaining to either contract.”

Some contracts with Vitalité found that 15 per cent of travel expenses were paid with no or little supportive documentation. For example, an accommodation charge of $2,700 for a month’s rent, while only a timesheet for three days’ worth of work was provided as supportive documentation.

Thirty-four recommendations have been made to the department, Horizon and Vitalité. One advises Vitalité to perform a post implementation review on these contracts, and “establish alternative options” when dealing with short and long-term staffing shortages.

Province seeking legal advice on if it can extricate itself from existing contract

Martin said Vitalité did not disclose three internal audits it had done on one of its contracts, and said that’s in violation of the Auditor General Act. Desrosiers, said in a statement that those internal audits are protected by privilege and could not be made public – but she said they did offer to share them under a non-disclosure agreement “which was refused.”

“We clearly explained this constraint as the network is in the midst of a dispute with one of the companies targeted in this investigation. Sharing the documents in question could have been detrimental to certain negotiations currently underway, which are being conducted in the interests of public finances,” she said.

Desrosiers also said much of what was recommended has already been implemented. She also noted there wasn’t a lack of co-operation from the network regarding the audit.

Horizon Health’s CEO Margaret Melanson said, “Many New Brunswickers have been cared for by travel nurses, and their efforts have helped our health-care system get through an unprecedented time.”

She said the network has received and accepted all recommendations made by the auditor general, and have implemented eight of the nine.

“The final recommendation – an internal post-implementation review on the use of contracted travel nurses – will be completed by September of this year,” Melanson said. “Most of our travel nurse contracts concluded at the end of last year however, we still require travel nurses to staff a few critical areas, such as emergency departments, due to high vacancy levels. Horizon has undertaken aggressive nursing recruitment strategies and so far this year has already hired 193 registered nurses, and we expect to no longer need to use travel nurse agencies by the end of this calendar year.”

Premier Blaine Higgs said in the New Brunswick legislature he was disappointed with the result of the auditor general’s report.

Social Development Minister Jill Green said the province is currently looking into if it can legally extricate itself from the existing contracts still in place.

For more New Brunswick news visit our dedicated provincial page.