Vitalit CEO says top health official gave 'green light' to travel-nurse contracts

The CEO of the Vitalit health authority says costly travel nurse contracts were the result of pressure from the Higgs government to fix the health-care system quickly and a refusal by that same government to approve other, less expensive options.

Dr. France Desrosiers told a committee of MLAs Thursday morning the health network was given a "mandate" in the summer of July 2022 to rapidly improve health care following the death of a patient in a Fredericton hospital emergency department.

"We were mandated to fix the situation quickly," she said. "The pressure was high. It was one minute to midnight."

Vitalit was in the midst of a staffing crisis at the time that left the authority on the verge of closing hospital emergency departments in two regional hospitals, the CEO said.

Dozens of other departments were unable to function, she added. Dialysis patients who normally required four hours of treatment were getting three hours.

Desrosiers said she met at the time with the new deputy minister in the health department, Eric Beaulieu, who promised to provide funding if travel-nurse costs put Vitalit into a deficit.

She said she would not have signed the contracts otherwise.

"He used those words, 'I'm giving you the green light to go ahead,'" Desrosiers told MLAs on the legislature's public accounts committee.

"'It's understood that this will cost tens of millions of dollars?'' she recalled saying in the meeting.

"'Yes, it's understood,'" she quoted Beaulieu responding.

WATCH | 'No choice left,' says Vitalit executive on travel-nurse costs:

Vitalit offered Higgs government 9 options to reduce use of travel nurses

3 months ago

Duration 1:36

Vitalits assistant CEO, Patrick Parent, says the province rejected a less expensive retention plan for nurses.

Earlier this week Beaulieu, in his own appearance at the committee, backed up Health Minister Bruce Fitch's claim that the cost implications of the contracts only became clear to the department in early 2023.

In a written statement, Fitch said Desrosier's comments "appear to be designed to deflect from the organization taking responsibility for their actions."

He pointed out that Vitalit paid "significantly more" for travel nurses thanHorizon Health something Desrosiers has explained stems from its greater need for bilingual personnel.

Fitch also claimed that some MLAs "chose to use today to attack hard-working public servants," though he didn't elaborate.

Lack of due diligence, auditor general says

Vitalit's leadership was the last group of officials to respond to the committee's questions following a scathing report by Auditor General Paul Martin that slammed what he called a lack of due diligence in the awarding of $173 million in travel nurse contracts.

Health authority officials said the spending could have been much less had the Higgs government approved nine other options theirteam presented to the province in the second half of 2022.

Theseincluded retention bonuses, bonuses for nurses who were close to retirement but chose to stay, premiums for nurses willing to move to units with critical shortages, payments for unused sick leave and flexibility on vacation scheduling for nurses lacking seniority.

All were rejected.

That left Vitalit no choice, Desrosiers said, but to ramp up the use of travel nurses at what she acknowledged was a huge cost.

"I can't tell you that a human life isn't worth what we paid," she said.

The health authority's assistant CEO, Patrick Parent, told reporters later that the other options would have been less expensive and would have at least reduced the dependence on the expensive travel nurse contracts with private company Canadian Health Labs.

"It would have diminished the need greatly. Would that have mean that we'd have more options to go with different firms? Highly likely," he said.

"I'd like to believe, and the team would like to believe, that our options and flexibility would have increased dramatically if that had taken place."

Opposition MLAs said Vitalit's appearance shed new light on the origins of the contracts and it may be worth the committeeholding more hearings or requesting documents.

"I don't think we're completely at the bottom of this yet," said Green MLA Megan Mitton.

Liberal MLA Keith Chiasson said he'd like to ask Beaulieu about the "green light" he apparently gave to travel nurses.

"New information is coming out. For sure I'd like another kick at the can to ask him to ask him why."

Former health minister Dororthy Shephard said near the end of the day's hearing that a judicial inquiry should be called, something the committee doesn't have the power to do.

The committee held a brief closed-door meeting afterward but the chair, Liberal MLA Chuck Chiasson, refused to say what it decided.

Premier Blaine Higgs has questioned the value of the contracts, and Health Minister Bruce Fitch has refused to express confidence in Desrosiers in the wake of the audit, saying that's up to the Vitalit board.

The CEO told reporters Thursday she felt like she'd been thrown under the bus by the government.

She reminded MLAs during her appearance that the lack of documented approval for the contracts which Martin's report criticized had its origins in Higgs's sweeping changes to health-care leadership in July 2022.

"Our premier appointed trustees to reduce the administrative burden and speed up decisions and eliminate obstacles quickly," she said.

Vitalit's largest contracts, costing a total of $98 million so far, were with Canadian Health Labs. The last of the three agreements remains in effect until February 2026.

Those agreements include so-called "bundled" teams of nurses at a cost of more than $18,000 per day, working out to approximately $306 per hour per nurse.

The company "practically had a monopoly," because it was the only agency that offered a guarantee it could get French-speaking nurses into place quickly, the CEO said.

That made it "almost impossible" to negotiate a better deal, she said.

Martin's audit criticized what he called an "auto-renewal" clause that allows the contract to extend past February 2026 if the company meets certain thresholds for bilingual nurses.

But Parent told the committee that Vitalit's interpretation of the clause is that it's at the health authority's discretion whether to renew the contract.

That issue, and a disagreement over whether Canadian Health Labs was billing fair market prices to the health authority for some expenses, are both the subject of a dispute resolution process between the company and the health authority, he said.

Vitalit board chair Tom Soucy said that process is why the health authority didn't want to hand over three internal audits of the contracts to Martin's office.

He said the health authority was willing to give Martin the audits if he promised not to make the information public, but the auditor general wouldn't provide that guarantee.