'Process failed' in travel-nurse contracts, former PC health minister says

A former provincial health minister in the Progressive Conservative government says key failures at the heart of the costly travel-nurse contracts may need more investigation.

Progressive Conservative MLA Dorothy Shephard made the comments Tuesday during the first of three days of hearings by the legislature's public accounts committee.

She told Eric Beaulieu, the deputy minister at the Health Department, that she was struck by how many invoices were paid to private travel-nurse companies without proper documentation of services being delivered.

"Process is what protects everybody," Shephard said. "I think one of the big concerns with the auditor general's report is that somehow, process failed.

"It didn't just fail in one sector. It failed over three separate entities, and that's cause for a little bit of concern, I think, and maybe even more investigation."

Beaulieu was the deputy minister of social development when that department signed a contract with Canadian Health Labs Inc. for travel nurses in long-term care in early 2022.

He became deputy minister of health on June 30, 2022, just 29 days before the first of three travel-nurse contracts was signed between the Vitalit health authority and Canadian Health Labs, a private company.

Beaulieu said the system was under severe staffing pressures at the time "and obviously shortcuts were done" in the accounts payable process.

WATCH | 'It didn't just fail in one sector,' former health minister says:

Former health minister laments process failure on travel nurses

3 months ago

Duration 2:36

Dorothy Shephard questions how travel nurse invoices were paid without proper documentation.

Shephard acknowledged that the COVID-19 pandemic was creating widespread staff shortages but argued this ought not to have affected how bills were paid.

"I can easily understand the need to get bodies to the front line," said the Saint John Lancaster MLA, who is not running again in this year's election. "That's a really easy no-brainer.

"But the process for paying invoices is usually pretty much the same, day in and day out. That's why I'm concerned about that failure in process."

Shephard's comments at the committee are her first public remarks on the travel-nurse controversy since Auditor General Paul Martin released a scathing audit on the contracts earlier this month.

She turned down a request from reporters to elaborate during a break in Tuesday's committee session.

Martin's audit reported that:

• The Social Development Department paid Canadian Health Labs without requiring evidence that work was done and without ensuring the amounts complied with the long-term-care home contract in early 2022.

• The department paid travel expense claims based on missing or incomplete information.

• Horizon Health paid many travel expense claims to its travel-nurse providers without documentation, and some payments were higher than what was allowed under their contracts.

• More than one-quarter of $23 million worth of work-hour invoices to Vitalit that Martin examined were paid despite not having required signatures from hospital supervisors.

• Vitalit also paid many invoices without proper documents, including for car rentals, accommodation and meals.

Martin's report examining $173 million in spending on travel-nurse contracts, including $98 million paid by Vitalit to Canadian Health Labs, has become a major political issue for the Higgs government.

Beaulieu backed up statements by Health Minister Bruce Fitch earlier this month that officials at the Health Department only began to realize in early 2023 how much the health authorities were spending on travel nurses.

Vitalit's contracts with Canadian Health Labs continues until 2026 and allows the company to be paid in some cases where there's no need for its nurses.

It also allows for the contract to be renewed automatically at that time as long as the company meets certain language service thresholds.

Social Development Minister Jill Green said in the legislature earlier this month that the government was looking for ways to "extricate" Vitalit from its contract.

Beaulieu told the committee Tuesday that "our ability to intervene on any of the contracts is non-existent."

He said government lawyers have been giving the health authority advice on how to lower its costs under the contract, but the department's focus has been to reduce the need for travel nurses by recruiting more nurses to work directly in the system.

"The only way to eliminate the need for travel nurses on an ongoing basis is to have more human resources," Beaulieu said.

Beaulieu said 12.6 per cent of nurse positions in the health care system are vacant now.