While healthcare organizations may think that hiring permanent physicians is more cost effective, using Locum Tenens physicians will actually save money, amongst other benefits.
Locum Tenens physicians provide immeasurable benefits for healthcare organizations that are looking to fill in the gaps in their current services. Unfortunately, many healthcare providers fail to recognize the advantages associated with Locum Tenens physicians. Instead, these organizations may only consider permanent physicians when a position becomes available. Though permanent physicians do offer many benefits, some organizations operate under the false belief that they are inherently more cost effective. When the cost analysis is broken down, however, providers can get a better picture of the financial benefits of hiring Locum Tenens physicians. Not only can these temporary placements save healthcare organizations money, but also they can add significant value to any practice.
Direct Cost Comparison Between Permanent Physicians and Locum Tenens Physicians
Before comparing base salaries between Locum Tenens and permanent physicians, it is important to understand the added expenditures associated with the employment of each option. When hiring a permanent physician, a healthcare organization must also consider:
- Benefits including health insurance;
- Perks including gym memberships, parking, etc.
- Retirement plans including pension or 401K contributions;
- Placement fees;
- Signing bonuses;
- Licensing fees;
- Continuing medical education expenses;
- Workers compensation;
- Malpractice insurance; and
- Relocation costs.
For a general surgeon who practices in the north central United States, for example, these costs can add up to around $160,000.00, excluding salary. The salary of a highly skilled general surgeon can be as much as $440,000.00. When this figure is included, healthcare organizations are looking at a total of around $600,000.00 to hire a permanent physician.
On the other hand, when hiring a Locum Tenens physician, healthcare organizations only need to consider the following added costs:
- Travel expenses;
- Housing expenses;
- Car or transportation expenses; and
- Malpractice insurance.
For a Locum Tenens general surgeon practicing in the same general region as described above, these expenses can total approximately $93,000.00 for a 46 week period. The bill rate for this period of time for a highly skilled general surgeon is approximately $339,000.00. Thus, to hire a Locum Tenens general surgeon, it would cost a healthcare organization approximately $432,000.00.
Therefore, by hiring a Locum Tenens general surgeon, as opposed to a permanent physician, healthcare organizations can save themselves approximately $168,000.00 in salary and expenses. Even in the most highly paid fields, such as radiology or anesthesiology, providers can expect to see cost savings when they hire Locum Tenens physicians.
Additionally, it is important to consider the potential of lost revenue when positions remain unfilled. Using the same example as above, healthcare organizations in that area can expect to lose approximately $550,000.00 in lost charges for that same 46 week period if a general surgeon is not obtained via either Locum Tenens or permanent placement.
Fortunately, Locum Tenens provides healthcare organizations across the country with the ability to quickly fill gaps in service with highly skilled physicians. The cost savings, however, are only part of the benefits provided by Locum Tenens.
Additional Benefits Associated With Locum Tenens
Aside from cost savings, healthcare organizations can expect to see the following benefits:
- Increased patient satisfaction via shorter wait times, increased access to physicians (including specialists), and more efficient care;
- Decreased stress or burn out of other medical professionals and staff members due to the addition of another physician and lightened work load;
- Enhanced and streamlined services, including less wasted time for patients and staff, as well as fewer gaps in service; and
- Better clinical outcomes due to the vast experience and high quality of care provided by Locum Tenens physicians.
At Medstaff National Medical Staffing, we are committed to helping healthcare organizations connect with highly skilled Locum Tenens and permanent physicians. We help facilitate this connection so that each party feels completely satisfied with the placement. Our team of specialists will promptly address any additional needs that physicians or healthcare organizations may encounter during employment. If you are ready to see the benefits of hiring Locum Tenens physicians, or if you are a physician looking to participate in Locum Tenens work, please feel free to contact us today.