Healthcare Staffing in the Post-ACA World

As the Affordable Care Act continues its march toward full implementation, the combined effect of employer and individual mandates presents challenges to staffing firms, both in-house and the clients they serve.

Integrated Healthcare Executive spoke with Jason Leverant, president and COO of AtWork Group, a leading U.S. staffing firm with nearly 100 locations and gross sales of $257 million, about some of the issues faced now and trends he anticipates in the coming years.

Leverant, named to the Staffing Industry Analysts’ most influential “Staffing 100” list for the past two years, was instrumental in the development of the American Staffing Association’s Affordable Care Act (ACA) Cost Calculator, an interactive tool aimed at helping staffing companies calculate potential costs under healthcare reform.

What are the current growth trends for the healthcare staffing industry?

From a trending perspective, we continue to see U.S. employers leaning more and more on staffing firms to help them build their “contingent workforces.” This includes healthcare facilities. This is because of the inherent value we bring to the table to these entities, including time savings, flexibility, cost savings and risk mitigation.

That fourth “value-add”—risk mitigation—seems to stand out as one of the most valuable in this day and age. As a staffing firm, we’re the “employer of record,” which means we carry insurance liability on all fronts for our employees—their worker compensation, general liability, professional liability and unemployment. This value has increased exponentially based on the ACA and post-recession economic conditions.

How do you find good people for yourselves and your clients in the face of shortages in some areas of the healthcare profession? What positions are seeing an increase in demand?

We’ve dealt with a skills gap in the healthcare arena for years, and with the passage of the ACA, this is only going to increase. As more and more people gain access to affordable health insurance, we’re going to see increased patient populations at facilities across the country. This demand is going to strain an already-short workforce even further! We continue to see demands in our primary field of staffing, nursing, with a tremendous shortage for trained and experienced RNs who are experienced working in an acute-care environment.

Health IT (HIT) is a growing staffing sector that’s worth mentioning. The increase of cybercrime has expanded the need for qualified professionals to create better security systems, while advances in HIT systems are pushing hospitals and physicians to find qualified interoperability experts now more than ever. We feel this job outlook will grow in the next few years.

How has healthcare reform affected your costs and solutions? Have there been other impacts on staffing?

The ACA has affected our internal costs quite a bit. As with anything that requires additional products, tracking, reporting, support and so forth, our overhead costs have increased. Based upon the already-competitive nature of the staffing industry, many/most firms weren’t able to fully absorb these costs, which means they had to work directly with their client partners, passing through some of the increased costs to their clients. These have been challenging conversations for the most part, but our clients have understood that we’re not alone in the increased costs of doing business in this current legislative and economic climate.

What are the new staffing issues faced by both your clients and your firm since the advent of the ACA?

The issue the staffing industry faced when the ACA was introduced was a lack of benefits available to us. Major medical health insurance was never a benefit staffing firms concerned themselves with because of the inherent nature of staffing—it’s temporary. The mind-set has always been that if someone was interested in major medical health insurance, they would look for a position that was “temp-to-hire,” and the client company would offer those benefits to those employees when an associate transitioned to their payroll. 

Under the ACA, we’ve had to work closely with benefit providers to create plans that made sense for the staffing industry. One of the primary challenges that needed to be taken into consideration was the issue of group participation. In the past, if a staffing firm attempted to offer a traditional “fully insured” health plan to its employees, the insurance carriers required a minimum participation of at least 75% or more of the workforce, but the reality is most temporary employees are not approaching staffing firms for a robust benefits package. They’re looking for a paycheck. Fortunately, we have some great vendor partners who were able to work with the major health insurance carriers to build out plans that have very minimal participation requirements (some as low as 1%). These have truly been a great resource for us in our quest to remain compliant with this complex law.

As to be expected, though, we did not have a tremendous amount of people enroll in [our] coverage (less than 1% of our workforce). This confirmed our initial thoughts that people do not approach staffing firms for their benefit packages. They are looking for a gateway into one of our client partners, or they are looking for a paycheck. Moving into 2016, we are adapting our compliance strategy knowing this.

What exactly is the ACA cost calculator you helped develop? What does it do and what kind of feedback have you gotten on it?

It’s an interactive tool designed specifically to help staffing companies calculate potential costs under the ACA. I was a part of a six-person team that created it for the American Staffing Association (ASA). It’s a worksheet to help firms determine whether they should “play” or “pay” in accordance with the ACA, and includes several cost-recapture scenarios. This has been a tool for ASA members since 2012, and it’s been well received, with a few updates since then to keep up with changing regulations.