Two bills introduced in the Colorado legislature are targeting third-party agency interactions with senior living and care providers.
HB23-1030 would prohibit healthcare staffing agencies from collecting “conversion” fees from healthcare facilities — including assisted living communities and nursing care facilities — that initially hire contract workers then hire them as a full-time employees.
Temporary staffing agencies often charge direct-hire fees when a provider hires a temporary employee for a permanent position. As the bill is written, however, violators would incur a penalty of up to $5,000 for using conversion fees.
Doug Farmer, president and CEO of the Colorado Health Care Association and Center for Assisted Living, told McKnight’s Senior Living that staffing agencies have presented several challenges for long-term care providers.
“When a provider finds a temporary worker that is interested in being a full-time employee, the separation fee is a two-fold challenge,” Farmer said. “First is the cost, which is typically $5,000 to $7,000. The second challenge is that when a provider chooses to make that investment, there is no guarantee that the relationships with the new employee will last.”
If the employee leaves for another job, Farmer said, the provider is out those conversion fee dollars and still has no employee.
“This bill would make it easier for workers to choose their employer and for employers to seek qualified candidates,” Farmer said.
Deborah Lively, LeadingAge Colorado director of public policy and public affairs, said that the association supports the bill “as an attempt to lessen the financial burdens placed on healthcare facilities by staffing agencies and to support the efforts of our members to recruit quality employees.”
If passed as written, the law would be the second in the state to try to rein in aggressive agency tactics. Last year, lawmakers limited the use of noncompete clauses in agency contracts. Illinois, Iowa and Kentucky also passed updates restricting the use of noncompete clauses for nurses or healthcare employment agency workers.
Earlier this year, the Federal Trade Commission proposed a new rule prohibiting employers from requiring workers to sign noncompete agreements. It would require employers to rescind any existing noncompete agreements.
Assisted living referral requirements target of bill
Meanwhile, Colorado SB 23-063 would require assisted living referral agencies to disclose privacy policies and an individual’s right not to be contacted. The bill also would modify documentation and contract requirements, and would mandate that referral agencies not refer prospective residents to more than a “reasonable number of residences” with the intent to deny other referral agencies from receiving a referral fee.
Lively said that LeadingAge Colorado understands the part referral agencies play in the overall senior living landscape, but the focus of the bill is on “protecting the interests of our members as they partner with these agencies to obtain referrals.”
Although several amendments may be forthcoming on the bill, Lively said that as it currently is written, LeadingAge Colorado has no significant concerns and that the legislation would not alter the relationship between providers and referral agencies.
