Locum Tenens: The Motivators, Prerequisite Knowledge, and Benefits
Published: Aug 06, 2014
Career Resources articles posted on NEJM CareerCenter are produced by freelance health care writers as an advertising service of the publishing division of the Massachusetts Medical Society and should not be construed as coming from the New England Journal of Medicine, nor do they represent the views of the New England Journal of Medicine or the Massachusetts Medical Society.
By Thomas Crawford, PhD, MBA, FACHE, faculty, Department of Urology, College of Medicine and affiliate faculty, department of Health Services Research, Management and Policy College of Public Health and Health Professions, University of Florida and Jack Callahan, chief executive officer, vJc Medical
Locum in Latin means to “hold a place” and within the health care industry locums has become synonymous with innumerable physicians who are amenable to using their time and many talents to help solidify the pressing staffing needs of hospitals and practices across the country. Because of the ever-growing number of opportunities for locums, we wrote this article to highlight the motivators for accepting an assignment, to detail the helpful prerequisite knowledge, and to highlight the benefits associated with accepting a locums assignment through an established and reputable company.
What motivates a physician to accept a locums assignment? The answer is multifactorial and will vary from physician to physician; nevertheless, the following list represents the primary motivators provided to Jack Callahan, CEO of vJc Medical, a locums company, by the physicians he works with across the country:
- Income — additional income or income above the national median
- Location — close to family, friends, or a destination that is appealing to you and your family
- Job Outline and Duties — the ability to balance the assignment with family and non-work activities
- Potential for Permanent Placement — an increasing number of physicians are using the temporary assignment to locate a community and workplace culture that provides the right fit personally and professionally
As highlighted by the preceding list, the motivators present a unique opportunity that transcends beyond simply “holding a place” within a partner organization. On the contrary, the list provides a unique opportunity to create a mutually beneficial relationship that could yield numerous immediate and long-term prerequisites for both parties. However, to ensure that each physician is informed and to limit any unwanted surprises, we have found that physicians need to understand the reasonable and customary practices associated with this genre of professional engagement.
Although the locums partnership may be shorter in length than traditional employment opportunities, we believe this enhances the burden of prerequisite knowledge. With this stated, the following list was compiled to underscore the salient points that you should consider before selecting a locums company and accepting an assignment:
- You must give oral or written permission every time a company sends your curriculum vitae (CV) to a hospital or clinic. (Note: We recommend that you should discontinue working with a company that has sent your CV to hospitals and clinics without your approval. Why? Your association with that company will exclude you from a locums opportunity with a subsidiary that has an exclusive relationship with a larger hospital. Based on this premise, you need to keep track of your assignments. Once you are presented to a hospital by a firm, you are obligated to work through that locums company at that particular location for the term of the noncompete.)
- Companies must provide you with the city and state, name of location, hourly and daily rate, job details, and schedule before they can present your CV.
- You need to know and understand the type of insurance and coverage limits of the malpractice insurance the company is providing you. Request a copy of the face sheet for this information.
- We recommend working with two or three companies. Each company works with different hospitals or clinics; therefore, you will provide yourself the best chance of finding an assignment that meets your criteria.
- When you sign a contract, understand that it is binding and there may be repercussions of not fulfilling your obligations. Exercise your 30-day out clause (which is a staple of most locums independent contractor agreements) when necessary. With this stated, know what your “out clause” is and ensure that the client’s out clause mirrors your obligation.
- Ask why the hospital or clinic is in need of a locums physician. Is it recruiting? Has there been significant turnover? The answer to the question will aid in your understanding of the context and environment in which you’re about to work.
- Compensation rates have jumped dramatically over the last five years, and you need to know what the average salary is for your specialty — both geographically and nationally. For this information, you can consult resources such as the Medical Group Management Association (MGMA), American Medical Group Association (AMGA), and University HealthSystem Consortium (UHC). Locums assignments generally provide additional compensation; nevertheless, be careful not to price yourself out of an assignment. Provide a remuneration rate that you can live with but won’t overleverage the hospital or clinic. This type of remuneration rate will ensure that you are awarded the assignment as needed versus being let go once a more cost-effective alternative is found.
- Health care entities know and understand the locums industry’s standard rates. Therefore, if a company requests a rate that is significantly higher than the industry average, these entities will assume this is being driven by the physician, and it may create a scenario that you need to overcome before you ever set foot on campus; additionally, you may limit your opportunities for this assignment on a reoccurring basis (note the more cost-effective alternative reference above).
- Understand your call pay. Do you need to provide gratis hours? Is overtime expected?
- If the hospital wants to buy the contract and offer you a permanent position, is there a prohibitive fee? Please understand that the physician may be culpable and responsible for the permanent placement amount should the hospital or clinic try to go around the locums company.
- From an Internal Revenue Service (IRS) standpoint you are a 1099 independent contractor. Please know that the locums company will not take out taxes or federal withholdings, so you are responsible for keeping track of these. Additionally, travel expenses that you incur which are not reimbursed (e.g., food, dry cleaning, etc.) may be tax eligible write-offs as allowable expenses, so save your receipts and consult your tax professional.
- Generally, you will not receive unemployment or other fringe benefits (e.g., health care insurance, etc.). Higher hourly rates versus the industry average imply that you will have to arrange for these on your own.
- Lastly, you need to know that locums jobs open and close relatively quickly (versus a permanent placement position that may be open for some time). Thus, when you see an assignment that works for you, you need to act quickly.
Everything in the locums business revolves around matching a physician with a need. Based on this premise, we recommend and advocate that you work with reputable locums company. To underscore this assertion, we’ve catalogued the benefits of doing this versus securing these positions on your own.
The Benefits of Utilizing Locums Companies
Locums firms provide the candidate with numerous benefits and will act as the liaison between you and the hiring entity. The following list represents these benefits, which generally are not associated with securing the position through other means:
- You will get paid weekly. Without a locums company, you would have to invoice the hiring entity at the conclusion of the assignment and wait for your remuneration; the process may take up to 90 days.
- With a locums company, your travel expenses will be pre-paid. Otherwise, you will have to front the required capital and, once again, wait for payment for the expenses incurred.
- You will receive group medical malpractice coverage instead of extending your current policy or securing coverage on your own.
- Locums companies will work on your behalf to broker an assignment that is in the best interests of you and the hiring entity.
- Locums companies have their own systems and established relationships that help identify jobs and assignments. Their processes for qualifying the job and gathering the granular information required to successfully pair a physician with a work assignment should not be taken for granted: this process helps ensure a mutually beneficial experience for the physician and the hiring entity.
We are currently in the midst of an unprecedented physician shortage and this has created innumerable employment and locums opportunities across the country. As a result, accepting locums assignments provides the physician with more advantages than simply supplementing your income; nevertheless, to capitalize on the innumerable benefits that these positions possess, we strongly recommend using an established locums company to identify the opportunities and to ensure that you have a seamless assignment and a rewarding experience.