CA 'Gig-Worker' Nurses Could Soon Book Directly With Hospitals as Independent Contractors
Updated: August 22, 2023
In 2022, “gig nursing” was introduced with apps that connect nurses directly to open shifts at healthcare facilities. For instance, apps like ShiftMed and CareRev take nurses who can be classified as independent contractors and connect them directly with partnering hospitals that post open shifts they can book through the app.
Some have hailed the “gig” era of nursing as a positive, while others say it further demotes nurses from high pay and benefits, but it may be a short-lived trend, as some states are already fighting to outlaw the practice.
How it Works
Gig worker nursing works like this: instead of being hired by a standalone staffing agency, nurses could become independent contractors and get hired directly by hospitals on an on-demand basis. For instance, the app CareRev is already offering this service. For instance, the app CareRev’s explains that the platform is one that “seamlessly connects healthcare facilities and local, flexible healthcare professionals.” A facility posts open shifts and then healthcare professionals can book the shifts directly from the app, without any staffing agency, contracts, or max or minimums involved.
Because the healthcare workers that use the service are acting as independent contractors, that also means that they will have zero protections or benefits from either the facility they work at or a staffing agency. The nurse as an independent contractor is then responsible for:
- Deducting and paying their own taxes
- Purchasing all insurance coverage, including health insurance, other medical insurance, and liability insurance
- Setting up their own retirement plan
Additionally, the nurse may not have access to any employee-only benefits or services, such as mental health or wellness resources, educational benefits, and training. Some reviews of the app have also warned that there are no placement protections and nurses have been placed in unsafe staffing conditions and working placements outside of the scope of their practice.
On the flip side, some nurses have raved about the flexibility the app provides.”I have Been working with CareRev for over 3 years. I'm very happy. I can pick the centers I choose and ignore the ones I don't care for. My paycheck is deposited regularly approximately 3 days after my shift. ( I love not having to wait 2 weeks for a check.),” reads one review of CareRev on the Google Play store.
Using an app for gig nursing work does have some potential benefits. For instance, it doesn’t require signing with a travel agency, they can book shifts only as they want or need them, and if they aren’t in need of benefits, it’s an easy way to make their own schedule and build the income that they want.
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The Legislation
With the advent of apps like CareRev and other nurse-for-hire services popping up, California has introduced legislation to legally declare that any nurse or healthcare worker using digital services to book shifts be classified as an independent contractor. The primary purpose of the bill is to classify healthcare workers who use digital platforms and meet certain criteria, as independent contractors. That means, just like Uber drivers, they will not be classified as employees and will not have access to the protections and benefits provided to employees.
The measure was filed last week with the state’s attorney general’s office and was submitted by the same law firm that was involved with the Uber campaign (Proposal 22) to keep DoorDash, Uber, Lyft, and Instacart workers as independent contractors instead of employees. Coincidence? Maybe not, especially considering that the firm is probably well aware of the fact that the healthcare industry is projected to be one of the fastest-growing in the entire nation.
And as we all know, the nursing shortage, only exacerbated by the pandemic, is also expected to grow to critical levels. California alone is expected to have a need for 40,567 full-time equivalent RNs, or a 13.6% gap, until 2026.
MarketWatch revealed that the group proposing the ballot initiative is called Californians for Equitable Healthcare Access and has not revealed its backers yet. But Silicon Valley is already heavily involved in healthcare staffing technology, pouring millions of dollars into apps and websites that will match healthcare workers directly with open shifts.
And while some nurses and hospitals have been using the apps since they were introduced, there is new pushback against classifying nurses as independent workers. For instance, there is currently an ongoing lawsuit against a “nursing gig” app called Care. Stat that claims the app is misclassifying nurses as independent contractors.
Michigan also appears to be making moves that could slow down the nurse-as-independent-contractor movement. The state’s bill HB 4390 would establish a three-factor “independent contractor” definition and impose a steep fine for any employer that misclassifies an employee as an independent contractor, to the tune of more than $10,000.
How Could This Affect Nurses?
The ongoing legislation could determine the future of gig work for nursing. Those who are against allowing nurses to work as independent contractors may see the new legislation as beneficial.
“Nursing…is fundamentally different from gig work,” Sarah Gray, founder of Trusted Health, an on-demand staffing agency that treats nurses as employees, not contractors, told Market Watch. “There’s a high barrier to entry. It’s a professional career, and in order to sustain that career and provide high-quality care, nurses need to have that proper care themselves in the form of employee benefits.”
Other experts have warned that turning nurses into gig workers will only make the understaffed for-profit model that hospitals operate on even worse. There’s also concern that the initiative could have a ripple effect, impacting all healthcare workers, from nursing assistants to home health workers, stripping them of protections, and benefits, and even lowering pay. Currently, California nurses make the highest wages in the entire country, with an annual salary of over $120,000, according to the Bureau of Labor and Statistics. Allowing the nurses in the state to work as gig workers could significantly impact pay and of course, benefits over time.
Notably, the move to reclassify nurses utilizing digital services to book work as independent contractors would also take them away from unions, which offer protection. And while flexibility is marketed as the primary benefit of on-demand work, it also leaves out the bigger picture: that “flexibility” means taking shifts that may not be ideal if nothing else is available, and a marketplace that, by definition, puts workers in constant competition with each other.
Plus, as another source pointed out, it’s important to remember that the customer market of apps that hire nurses for open shifts is not actually nurses—it’s hospitals that are looking to save on labor costs. And accordingly, the new legislation seems to be aiming just at those deep pockets, looking to ensure that there are steep costs and penalties in place for allowing hospitals to use nurses as independent contractors. Penalizing hospitals—or scaring them with large fines—could be enough to turn off the gig work for nurses movement.
