FAQ About Locum Tenens Salary & Finance

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Locum Tenens (Latin for “in the place of”) staffing is a growing industry, supporting healthcare facilities nationwide to meet the needs of qualified practitioners. As many as 6% of all active practitioners have worked locum tenens at some point in their careers, most with great satisfaction.

When it comes to understanding the “nuts and bolts” of hiring locum tenens, some common questions emerge. We’ve got your FAQs here. Contact us if you have any others.

1. Rates are per diem, how does that work?
Yes, services for locum tenens practitioners are billed “per diem.” When you compare that rate to the cost of hiring a physician, it’s important to factor in other expenses, such as:

Malpractice insurance
Travel
Housing
Employer’s portion of FICA
Continuing education
Credentialing
Signing bonuses for hiring
Benefits
In many cases: the cost of the job hunt, including advertising and the time for those involved in resume screening, interviewing and so on.
Given all that is included, per diem rates are often comparable to permanent physician salaries.

2. What About Malpractice?
Just like all practitioners, locum tenens physicians carry malpractice insurance. The per diem rate you pay for locums includes malpractice, and locum tenens firms ensure each clinician has coverage. In the event of a claim, locum practitioners are instructed to contact their placement agency directly, in addition to following appropriate internal policy.

3. Does It Really Make Financial Sense to Hire Locum During Peak Times?
The numbers may surprise you. Of course, the average gross in daily charges varies by specialty, but one of the most in-demand examples could be family practice. While it isn’t unusual to try to just reschedule patients to another clinician or another day, the resulting loss of revenue from an absence can easily reach $1,500/day. That doesn’t include the added stress (and possible turnover) to overloaded practitioners.

4. Does the Cost Change if an Assignment Goes Longer?
In the event that an assignment goes longer, in many cases, the same practitioner can be extended at the same rate. Your placement agency will work with your hiring team to try to ensure a continuity of coverage for your patients. Everyone is truly on the same team.

5. What About if We Choose To Hire Temp-to-Perm?
It can certainly happen that both a clinician and healthcare facility decides that a permanent placement would be mutually beneficial. In that case, speak with the placement agency (not directly with the practitioner) about the possibility of temp-to-perm. If an arrangement can be made, industry-standard placement fees apply.

The job hunt is expensive: advertising, interviewing, signing bonuses, etc. easily add up to $40,000 per hire (and by some accounts as high as $200,000). A placement fee for temp-to-perm is often much more cost-effective.