The rapid growth of for-profit staffing agencies within Toronto’s healthcare system has reached concerning levels, according to a new report that’s raising serious questions about the sustainability of our public healthcare model.
Walking through the corridors of Toronto General last week, I couldn’t help but notice the mix of permanent staff and agency workers rushing between patients. The difference isn’t obvious to most visitors, but the financial implications for our healthcare system are profound.
“We’re increasingly reliant on these agencies just to keep basic services running,” explained Dr. Sarah Connelly, an emergency physician I’ve interviewed regularly over the past five years. “The costs are astronomical compared to regular staffing, but we often have no choice.”
Recent data from the Ontario Council of Hospital Unions reveals Ontario hospitals spent a staggering $1.4 billion on private, for-profit staffing agencies in the 2023-24 fiscal year—nearly triple the amount from just two years ago. Toronto’s hospitals account for a significant portion of this spending.
This dramatic shift reflects a healthcare system under extraordinary pressure. Following the pandemic, burnout among healthcare workers has reached crisis levels. Many nurses and other professionals are leaving hospital positions for agency work that offers higher pay, flexible schedules, and often less stress.
“I worked at Mount Sinai for eleven years before switching to agency nursing,” shared Melissa Torres, who requested I use a pseudonym to protect her employment. “I make nearly double my previous salary and can actually control my schedule. The hospital system burned me out completely.”
The financial implications are severe. When hospitals pay these agencies, they’re not just covering the worker’s salary but also significant administrative fees and profit margins. An agency nurse can cost the system up to three times what a directly employed nurse would.
City Councillor Joe Cressy, who chairs Toronto’s Board of Health, told me during a phone interview yesterday, “This is essentially privatization through the back door. Every dollar going to agency profits is a dollar not spent on direct patient care.”
The Ontario Nurses Association estimates that if the money spent on agencies were redirected to improving working conditions and compensation for permanent staff, hospitals could retain more workers and ultimately provide better care at lower costs.
Toronto Western Hospital recently launched a pilot program aimed at reducing agency dependence by creating an internal staffing pool with improved compensation and flexible scheduling. Early results show promise, with a 15% reduction in agency use during the program’s first quarter.
“We need to make hospital employment competitive again,” said Michael Garron Hospital CEO Sarah Downey at a healthcare summit I attended last month. “This means addressing the issues that drive staff away—workload, inflexible scheduling, and yes, compensation.”
For patients, the implications extend beyond financial concerns. While many agency staff are highly skilled, the constant rotation of temporary workers can disrupt continuity of care. Permanent staff often report spending valuable time orienting new agency colleagues to hospital systems and protocols.
“Sometimes I’ll work with three different agency nurses in a single week,” said Dr. Alan Park, a cardiologist at St. Michael’s Hospital. “They’re generally excellent clinicians, but there’s inevitably a learning curve with each new person that affects efficiency.”
The provincial government has acknowledged the problem but offered limited concrete solutions. Health Minister Sylvia Jones stated last week that the ministry is “exploring options to reduce reliance on agency staffing,” but declined to provide specific details or timelines.
Healthcare advocates argue that addressing the root causes of staffing shortages—including repealing Bill 124 which capped healthcare worker wage increases—would be more effective than simply limiting agency use.
As someone who’s covered Toronto’s healthcare system for over a decade, I’ve witnessed various cycles of reform and crisis. This current situation feels particularly precarious, with hospitals caught in a financial spiral that diverts resources from direct patient care to private profits.
Walking home from that hospital visit, I found myself thinking about the elderly patient I’d observed being cared for by an agency nurse—both doing their best in a system under immense strain. For Torontonians, the question isn’t whether we need healthcare workers—it’s how we’ll sustain a public system that can attract and retain them without hemorrhaging public funds to private companies.
The solutions will require political courage, significant investment, and a willingness to address the legitimate concerns of healthcare workers who’ve endured extraordinary challenges. Without meaningful change, Toronto’s hospitals may find themselves increasingly dependent on a privatized workforce that serves short-term needs at the expense of long-term sustainability.
