As the healthcare landscape continues to evolve, more and more physicians are turning to locum tenens for independence and flexibility in their careers while earning a competitive wage. According to CHG Healthcare’s State of Locum Tenens Report, an estimated 50,000 physicians — 7% of the available physician population — are currently working locums.
But how, exactly, does locum tenens pay work? Here are answers to the most frequently asked questions about locum tenens compensation.
Q: How do doctors use locum tenens to make money?
A. The ways doctors choose to work locums can be as varied as the physicians themselves. Some work locums full time. Others work locums part time during times of transition or as supplemental income to a permanent, full-time position.
Locums assignments can be close to home and others may require travel. Telehealth locum tenens assignments allow you to remain in the comfort of your own home or office.
Contracts also vary in length from a few days — or even shifts — to multi-year assignments and permanent positions.
- Locums psychiatrist Dr. Greg Carr works locum tenens full time. “I had the intention of going permanent, but I realized the locum doctors around me seemed happier because they were being paid more. There are a lot of pluses to locum tenens: higher wages, greater freedom and flexibility, and not being locked into a job before you try something out. Everyone likes the feeling of security with a job. There can be a tendency to think, ‘This is the only place I want to work.’ But really, it’s hard to predict your life like that. Locums is not as unstable as it seems. There are always jobs to be had. You can always go in and out of locums.”
- Hospitalist Dr. Gary Trewick used locum tenens to pay off his student loans quickly. “I set out to pay down my student loan debt as quickly as possible. By utilizing supply and demand, I maximized the number of days I could reasonably work in a month without burning myself out and taking as good a rate as I could achieve. Initially, my plan was just to pay down my loans and then maybe settle into full time. But there are so many benefits to locums that I may never sign a regular W-2 contract again.”
- Dermatologist Dr. Carrie Cera Hill decided to work locum tenens part time to supplement her income while starting a private practice. “I needed to supplement my cash flow in the beginning while I grew my patient base. I had accepted a locum tenens contract through Weatherby Healthcare a few years ago, while in between permanent positions, and it worked out very well. So, I spoke to my consultant in hopes of finding a part-time opportunity that would accommodate the schedule at my new practice. I feel extremely fortunate. I was able to build the business I wanted, earn the extra income I needed to do it, and still be home with my husband and children every night. It was truly the best of both worlds.”
Q: What factors influence pay for locums?
A. Like any permanent position, locums pay varies widely by location, facility type, skill set, patient load, specialty, and shift type.
Job match
This is arguably the most important factor. Factors such as having the availability to cover all dates needed and recent experience with required procedures often make you a more competitive hire. Plus, it allows you to negotiate higher pay.
Location/facility type
Compensation rates for locum tenens work can vary based on the cost of living and market conditions in different regions. Areas with a higher cost of living or underserved locations may offer higher pay rates to attract locum tenens physicians.
Specialty
Facilities are willing to pay more for high-demand, hard-to-fill specialties. Locum tenens jobs are available in more than 100 specialties. Specialized skills and expertise can command higher pay rates as well.
Skill set/patient load
Positions that require specialized skills or knowledge of challenging procedures are likely to pay more than general assignments. Likewise, high-workload positions typically pay more than slower-paced assignments.
Shift type
The length and type of shift also have the potential to impact pay. Weekends, call, or holiday shifts may command higher hourly rates.
Do locum tenens physicians make more than employed physicians?
A. Rates can vary widely, but in general, locum tenens physicians earn a higher hourly rate than their full-time counterparts. Many physicians work locum tenens on the side to supplement their income.
According to the annual Medscape physician compensation report, self-employed physicians (which includes full-time locums) earned 9% more than employed physicians.
Q: What is the average locum tenens pay rate by physician specialty?
A. Primary care and surgical specialties are consistently among the most in-demand specialties, along with specialties such as pulmonology, cardiology, oncology, and psychiatry.
Locumstory.com reports the following average pay ranges for locum physicians:
- Anesthesiology: $238 – 275 hourly
- Cardiology: $175 – 200 hourly
- Cardiovascular Surgery: $2,000 – 2,500+ daily
- General Surgery: $1,000 – 1,400 daily
- Neurological Surgery: $2,000 – 2,500+ daily (stroke, up to $5,000 daily)
- Obstetrics and Gynecology: $100 – 140 hourly
- Oncology: $150 – 175 hourly
- Orthopedic Surgery: $1,200 – 1,500 daily
- Pediatrics: $80 – 105 hourly
- Pediatric Surgery: $2,500 – 3,500 daily
- Primary Care/Family Medicine: $90 – 125 hourly
- Psychiatry: $180 – 210 hourly
- Pulmonary Critical Care: $180 – 225 hourly
- Vascular Surgery: $1,700 – 2,200+ daily
Q: In what states are locum tenens physicians paid the most?
A. According to Locumstory.com, the following are the top-paying states for locums physicians:
LEARN MORE: Why do some states pay more than others for locum tenens?
Q. How does working with a locum tenens agency affect compensation?
A. One of the biggest benefits of working with a locum tenens agency is their ability to negotiate on your behalf. This can include compensation-related factors such as per diem payments, mileage reimbursement, callback rate, and shift premiums, as well as lifestyle-related factors like practice setting and location.
In addition, a good agency and recruiter will support you beyond getting you the pay you want. Your recruiter will help ensure everything goes smoothly during the assignment, from travel and housing to your relationship with the facility and planning for future assignments — all of which can affect your total compensation long term.
Every Weatherby consultant is dedicated to and trained to support a specific specialty, meaning they’re experts in how doctors in a given specialty are hired and have access to what job opportunities are open/available — sometimes even before the position is posted. This specialized approach helps each consultant ensure you get the pay you deserve.
Q. What costs does the agency cover?
A. In addition to your hourly rate, a locum tenens agency should also cover:
Malpractice insurance
Locum tenens providers are covered by the agency’s malpractice insurance while they are on assignment. The type of coverage may differ between agencies, so it’s important to understand your coverage options before working with an agency.
In most cases, Weatherby Healthcare malpractice insurance covers standard claims-made professional liability policy with $1 million per occurrence and a $3 million aggregate limit per provider. Claims-made malpractice coverage is a policy that provides coverage when a patient makes a claim against an insured physician during the policy period, regardless of when the actions discussed in the claim took place.
Weatherby Healthcare’s policy generally covers all physicians who work assignments with the company, although some healthcare organizations that contract with Weatherby Healthcare provide their malpractice coverage. Covered healthcare providers have coverage for both current and prior work for Weatherby Healthcare, even if they no longer work with the company when a patient makes a claim. Our consultants will work closely with you to ensure you have the best coverage.
Licensing, credentialing, and privileging
A locum tenens agency should support you through the necessary paperwork for temporary assignments. A good agency will have deep expertise and established relationships with boards and facilities to ensure licensing, credentialing, and privileging go as smoothly and efficiently as possible.
Travel and housing
Locum tenens agencies will arrange and cover all travel and housing for your assignment, including flights, rental cars, and housing. Housing is typically a hotel or extended-stay apartment near one’s assignment. If you have specific travel or housing needs, such as accommodating family members or a pet, be sure to share these details early in the process so your recruiter can work to ensure your needs are met.
RELATED: How Weatherby goes above and beyond for you
Q. What costs are not covered by the agency?
A. As independent contractors, there are some costs locums cover on their own, including:
Taxes
Locum tenens physicians are responsible for making estimated tax payments, as state, federal, Medicare, and Social Security taxes are not taken out of their paychecks. Locums will also be subject to income taxes in each of the states in which they work.
Medical insurance and benefits for locum tenens doctors
Locums are responsible for their benefits, including health and life insurance and retirement plans. Permanent physicians working part-time locums will likely receive these benefits through their full-time employer. Physicians working locums full time may consider purchasing insurance through a health exchange or an employed spouse’s plan.
Emergency medicine physician Dr. Ali Chaudhary is often asked about how she handles her benefits as a locum physician. “It’s actually not very difficult to set up your benefits, and even after benefits you still come out on top. You can customize it and look at it whichever way you want to. As an employee, you are still paying for your benefits, but you don’t have as many options. The benefits should not be the thing that keeps you away from locums.”
Q. Why do some agencies pay more than others?
Several factors can influence why some locum tenens agencies pay more than others:
1. Agency reputation
Established and reputable agencies are better equipped to provide quality services, and they maintain good relationships with facilities. These agencies typically have access — sometimes even before the job is posted — to higher-paying assignments, due to their reputation, the result of which is better compensation for locum tenens compensation.
2. Negotiation skills
Some locum agencies — like Weatherby — have veteran consultants who are able to secure higher rates for their physicians. They have established relationships with facilities and can leverage those connections to negotiate better compensation packages.
3. Benefits and incentives
Some locum tenens agencies may offer additional benefits that contribute to higher overall compensation. These can include travel and housing allowance, malpractice insurance, and other perks.
4. Agency transparency
Not all agencies advertise rates with full transparency. Weatherby Healthcare is committed to being transparent and honest about locum tenens pay rates. If a pay rate seems too good to be true, it probably is and may be an attempt to reel you in.
Q. Can I book my own locum tenens assignments?
A. Yes. Some physicians choose to book their assignments, and by doing so, it may be possible to negotiate a higher hourly rate than if you used a locum tenens agency. Keep in mind, though, that you will be responsible for all the costs and logistics of working as an independent contractor, such as
- Finding and booking your assignments
- Negotiating your rate
- Booking and paying for your housing and travel expenses
- Ensuring you have adequate malpractice coverage
- Getting licensed and credentialed
- Resolving any roadblocks and issues that may arise
The work can be time consuming and expensive, cutting into the hourly rate you negotiate with the facility. Additionally, if you have any issues, you won’t have the 24-hour support of an experienced agency backing you throughout the process.
Q. How do locum tenens taxes work?
A. As independent contractors, locum tenens physicians are responsible for paying their state, federal, Medicare, and Social Security taxes. This may sound like a downside, but as an independent contractor, you will have more opportunities to claim work-related expenses than a W-2 employee, such as personal travel and housing expenses, meals, work tools and supplies, and continuing education.
A qualified tax advisor can help you identify tax benefits and deductions available to independent contractors. Relevant deductions may include business travel, meals, continuing medical education (CME), or equipment, and other locum tenens tax deductions.
Seasoned locum tenens physicians urge careful planning and preparation and advise working closely with a qualified tax professional who is familiar with locum tenens work.
Rheumatologist Dr. Pierre Moeser lets his accountant do most of the work. “One of the biggest benefits is that locums pays well. The taxes are no different because you pay taxes no matter what. I just work with my CPA and let them know how much I’m earning in which states, and they write up an estimated tax form for me. As physicians, we’re really, really good at medicine. We’re not always really, really good with money.”
Q. When and how are physicians paid?
A. Locum tenens physicians are usually paid directly by the locums agency and not by the facility where they are assigned. Payment schedules will vary by agency. For example, Weatherby Healthcare providers have an online time-entry portal, and payment is made by weekly direct deposit.
LEARN MORE: How Weatherby’s provider portal works
Q. How does the staffing agency make money?
A. Hospitals and other healthcare facilities reach out to trusted, established locum tenens agencies when they have temporary staffing needs. These facilities pay the agency for finding a provider to fill the position and handle licensing, housing, and travel arrangements. Typically, this fee is a small markup to the provider’s contracted rate — a rate that can be negotiated with the help of an experienced agency. The facility pays the agency and in turn, the agency pays the provider for working the assignment.
How to get started
While many variables impact locum tenens compensation, physicians who work locum tenens are shown to consistently earn more than their counterparts who do not. And by having a well-established, highly rated locum agency like Weatherby Healthcare by your side, you can be confident that our expert consultants will be your staunchest advocates and provide top-tier service from beginning to end.
Do you have additional questions about working locum tenens? Give us a call at 954.343.3050 to speak with a Weatherby consultant or check out our job board.
