Province introduces legislation to cancel travel nurse contract that cost millions
Canadian Health Labs charged about $300 an hour per nurse — 6 times what a local staff nurse earns
The Holt government introduced new legislation Wednesday that would cancel a travel nurse contract with Canadian Health Labs.
"Vitalité signed a contract with CHL in the midst of the pandemic. We were desperate," said Health Minister John Dornan.
"The contract that we signed was not a good contract for New Brunswickers, for taxpayers."
By using legislation to cancel the contract the province doesn't expect to face financial or legal penalties.
The contract was signed by Vitalite in 2022 as the health-care system faced dire staffing shortages.
The agreement was later slammed by Auditor General Paul Martin, who said it carried a significant amount of risk and contained an auto-renewal clause should Canadian Health Labs meet its French-language obligations.
"The contracts with private nursing agencies were not reflective of best practices and did not demonstrate value for money," Martin said in his report.
Vitalité's three contracts with the company, which covered from July 2022 to February 2026, totalled $98 million, according to Martin. The company charged about $300 an hour per nurse — roughly six times what a local staff nurse earns.
Dornan said he's confident the province will be able to fulfil its staffing needs.
"We feel that we will be well served and have adequate nurses for our system without this contract.".
Vitalité recently cancelled the shifts of Canadian Health Labs' nurses working in its facilities.
Department of Finance officials confirmed to CBC News on Tuesday that the 2025-2026 budget contained no money for travel nurses. However, Dornan told reporters Wednesday that there are still a handful of nurses from different agencies working in the province, but said the need for travel nurses decreases "on a daily basis."
At least $108 million went to pay travel nurses in the fiscal year that ends on March 31.
Opposition Leader Glen Savoie said the Higgs government was looking at similar options prior to last October's election.
"We were looking at that and what it may cost us in terms of going to the courts," Savoie said.
He said if the government feels this is the right thing to do, "then we'll support that, but we want to know the details on how they intend to manage through the situation such as a possible court challenge and ensure people are getting health care."
Green Leader David Coon said the move needed to happen, considering the concerns with the contract.
"This was overdue. I don't know who signed that contract but it was ill-conceived and ill-determined and should never have been signed," he said.
"This is the best way to move forward and relieve Vitalité of that burden."
Paula Doucet, president of the New Brunswick Nurses Union, applauded the government for taking action, but says the next step will be to ensure the need for agency nurses is permanently reduced.
"We saw Horizon did that last September. There were some pains in the beginning, but we managed to work through that and I think Vitalité can really learn from Horizon's mistakes," she said.
"I'd really like to see a three-month, six-month, 12-month plan put in place to actually phase out the use of these private, for-profit companies."
Doucet hopes the union will be back at the bargaining table with the government soon and said that the lack of a contract can be an impediment to attracting new nursing graduates to work in the province.
According to a news release from the province, there was a net increase of 393 nurses over the last year, and there are nearly a thousand more students enrolled in nursing programs than in 2018.
One of the government's signature election promises was to make $10,000 retention payments to nurses working in permanent roles in the province. Another $5,000 bonus will go out this year.
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