title: The indirect costs of agency nurses in South Africa: a case study in two public sector hospitals.
abstract: BACKGROUND
  Globally, flexible work arrangements - through the use of temporary nursing staff - are an important strategy for dealing with nursing shortages in hospitals.
  
  
  OBJECTIVE
  The objective of the study was to determine the direct and indirect costs of agency nurses, as well as the advantages and the problems associated with agency nurse utilisation in two public sector hospitals in South Africa.
  
  
  METHODS
  Following ethical approval, two South African public sector hospitals were selected purposively. Direct costs were determined through an analysis of hospital expenditure information for a 5-year period from 2005 until 2010, obtained from the national transversal Basic Accounting System database. At each hospital, semi-structured interviews were conducted with the chief executive officer, executive nursing services manager, the maternity or critical care unit nursing manager, the human resource manager, and the finance manager. Indirect costs measured were the time spent on pre-employment checks, and nurse recruitment, orientation, and supervision. All expenditure is expressed in South African Rands (R: 1 USD=R7, 2010 prices).
  
  
  RESULTS
  In the 2009/10 financial year, Hospital 1 spent R38.86 million (US$5.55 million) on nursing agencies, whereas Hospital 2 spent R10.40 million (US$1.49 million). The total estimated time spent per week on indirect cost activities at Hospital 1 was 51.5 hours, and 60 hours at Hospital 2. The estimated monetary value of this time at Hospital 1 was R962,267 (US$137,467) and at Hospital 2 the value was R300,121 (US$42,874), thus exceeding the weekly direct costs of nursing agencies. Agency nurses assisted the selected hospitals in dealing with problems of nurse recruitment, absenteeism, shortages, and skills gaps in specialised clinical areas. The problems experienced with agency nurses included their perceived lack of commitment, unreliability, and providing sub-optimal quality of patient care.
  
  
  CONCLUSIONS
  Hospital managers and policy-makers need to address the effective utilisation of agency nurses and quality of patient care in tandem.
authors.affiliation: Centre for Health Policy & Medical Research Council Health Policy Research Group, School of Public Health, Faculty of Health Sciences, University of the Witwatersrand, Johannesburg, South Africa; laetitia.rispel@wits.ac.za.
authors.forename: Laetitia C
authors.initials: LC
authors.lastname: Rispel
authors.affiliation: Department of Community Health, School of Public Health, Faculty of Health Sciences, University of the Witwatersrand, Johannesburg, South Africa.
authors.forename: Julia
authors.initials: J
authors.lastname: Moorman
mesh_terms: D003284:Contract Services / Q000191:economics / Q000458:organization & administration*; D006779:Hospitals, Public / Q000191:economics / Q000458:organization & administration*; D006801:Humans; D009741:Nursing Staff, Hospital / Q000191:economics / Q000458:organization & administration*; D010561:Personnel Staffing and Scheduling / Q000191:economics / Q000458:organization & administration*; D013019:South Africa
keywords: South Africa; health workforce; indirect costs; nursing agency