How Does Locum Tenens Work for Physicians

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Locum tenens works by providing physicians on a temporary basis to fill short-term staffing gaps in a medical practice, offering coverage in place of another clinician.

Definition: Locum is Latin for "to hold the place of," refers to physicians who temporarily fulfill the duties of another.

It's simply a short-term contract with a medical facility such as a hospital or clinic, where you step in to fill a staffing shortage, often in places where your skills are urgently needed. It allows physicians to try different practice settings and metropolitan areas. Working as a locum physician can help you pay off medical school debt faster or bring extra income for financial security.

As someone who's spent 35 years as a practicing Anesthesiologist, including working locum tenens, I want to give you the real scoop. This is the guide I wish I had early on in my career.

Working in different locations, from remote rural clinics to large hospitals, teaches you more than just medicine, it teaches resilience and adaptability.

Yes, locum tenens can be tough. You might face isolation in rural settings or feel the pressure of constantly proving yourself in new teams. But the flip side? It's incredibly rewarding. You get to make a real difference where it's needed most, enjoy diverse experiences, and often, find a sense of freedom that traditional roles don't offer.

Reasons Why Physicians Work Locum Assignments

A key benefit of locum tenens work is the flexibility to earn extra income while experiencing diverse practice settings and advancing your skills.

Make More Money

In large part because of the current physician shortage many locum specialties, including Anesthesiologist, do make more money per hour than a W-2 permanent position. Which as a financial benefit of an increasing salary, you can accelerate your path to early retirement.

Pay off Medical School Loan Debt

A popular strategy for paying down medical school debt is to find a locum job and take advantage of higher income and flexible schedules. You may also qualify for early repayment benefits.

Tax Advantages for 1099 Physicians

Physicians operating as 1099 independent contractors, can unlock unique tax advantages like deductions on travel, education, home office, and other business related expenses.

Job Flexibility and Freedom

Locum tenens assignments offer physicians unparalleled job flexibility. These positions provide flexible scheduling, part-time options, and the freedom to select short-term assignments, catering to personal and family needs.

Build a CV with Diverse Assignments

When a physician chooses to work locum assignments, they inherently demonstrate adaptability and flexibility, essential skills highly valued in diverse practice settings.

Career Networking Benefits

Engaging in various medical settings and specialties enhances visibility and reputation within the medical community, fostering mentorship opportunities and collaborative research prospects.

Traveling Doctor Opportunities

If you have a passion for travel, positions are available nationwide, allowing you to explore new regions and cultures while working.

Burnout & Stress Management

If you're experiencing burnout or need a change from your current routine, locum tenens can offer a refreshing change of pace and environment.

Quick Employment Start with Expedited Credentialing

If you're in need of a quick start, locum positions often have expedited credentialing processes, allowing for faster employment compared to permanent roles.

Semi-Retirement Work-Life Balance

If you're considering semi-retirement, it's an excellent way to stay active in the field while reducing work hours.

Downsides of Locum Tenens

Locum tenens isn't always a walk in the park. First off, the inconsistency of bouncing between assignments can really mess with your sense of stability, and sometimes, you end up feeling more like a guest than a team member in these temporary roles. Then there's the hassle of constantly adjusting to new systems and protocols, which can be exhausting.

Income Instability: Unlike permanent positions, locum tenens work may lead to fluctuating income due to inconsistent work opportunities or gaps between assignments.
Lack of Benefits: Often, locum tenens roles do not provide the same level of health insurance, retirement plans, and other benefits that are typically offered in permanent positions.
Reduced Job Security: These roles can come with less job security, as assignments are temporary and can be subject to change.
Challenges in Professional Development: Continuous professional growth and development may be hindered due to the short-term nature of assignments.
Work-Life Balance Issues: The need to travel frequently and adapt to new environments can disrupt work-life balance.
Credentialing and Licensing Hassles: Working in different states requires dealing with varied and often complex credentialing processes and obtaining multiple state licenses.
Impaired Relationships: Constantly changing workplaces can negatively impact the development of long-lasting relationships with peers and patients.
Limited Administrative Support: There might be less support available for administrative tasks compared to permanent positions.
Risk of Feeling Isolated: Moving between different locations and teams can lead to a sense of isolation.
Difficulty Adapting to New Systems: Regularly adapting to different hospital systems and practices can be challenging and time-consuming.
Housing and Relocation Stress: Frequent relocations for each assignment can create stress and logistical challenges.
Contractual and Legal Complexities: Navigating the contractual and legal aspects of each assignment can be complicated.
Malpractice Insurance Concerns: Understanding and managing malpractice insurance in various states and for different assignments can be complex.
Perception of Career Instability: Working as a locum tenens physician may affect how others in the medical field perceive one’s career trajectory.

A lot of these cons of locum tenens work can be mitigated with the right support but I still think it's important to be aware of them.

Starting a Locum Assignment Step-by-step

So you've decided you like the pros more than you dislike the cons. Now where do we start?

Getting started with locum tenens can initially feel like you're navigating uncharted waters. The key is to be proactive: research various agencies, understand the different contract terms they offer, and don't hesitate to ask for what you need, whether it's about compensation, accommodation, or work hours. It's also crucial to be flexible and open-minded, as each assignment can vary significantly in setting, pace, and patient demographics.

I always recommend writing down on a piece of paper what is it that you want and what you don't. This will be helpful in grounding you when the offers start coming in. It's always good to remember what motivated you to start in the first place.

Finding Your First Assignment

Alright, let's dive straight into finding your first locum tenens position as an anesthesiologist. It's a bit like matchmaking – you're looking for the right job, and hospitals are seeking the perfect fit for their temporary needs. The process can feel overwhelming at first, but with a bit of know-how, you'll navigate it like a pro. Here is a high level overview of the process.

Essential Qualifications and Credentials

Medical Credentials
State Licensure: Obtain licensure in the states where you wish to practice. Each state has its process, so plan ahead as this can be time-consuming. You can visit the Federation of State Medical Boards for more information.
DEA Registration: Ensure your DEA registration is up to date, especially for prescribing medications.

Credentialing and Malpractice Insurance

Credentialing: Be prepared for a comprehensive credentialing process at each new facility. This includes verifying your qualifications, work history, and professional references.
Malpractice Insurance: Determine whether you need to procure your own malpractice insurance, or if it's provided by the agency or facility.

Finding Assignments

Recruiting Agencies: Connect with reputable recruiting agencies that specialize in anesthesiology locum tenens.
Contracts: Pay close attention to contract details, including pay rates, duration, on-call obligations, and accommodation arrangements.
Direct Hospital Contracts: Some anesthesiologists opt to work directly with hospitals or clinics, bypassing agencies.

Finding the Right Locum Tenens Agency

Researching Agencies: Research to find agencies with a strong focus on anesthesiology placements.
Evaluating Agency Reputation: Consider factors like agency support, variety of assignments, and transparency in compensation.

Preparing Your CV and Application

Crafting a Strong CV: Highlight your relevant anesthesiology experience and skills. A strong CV is your first impression.
Application Process: Familiarize yourself with the typical application process for locum tenens positions, which can vary between agencies.

Understanding the Marketplace

Market Trends: Keep abreast of current demand for anesthesiologists in the locum tenens market. Use anesthesiology focused job boards to get a feel for demand and compensation.
Geographical Considerations: Your location preferences can significantly influence job opportunities and lifestyle.

Preparing for Interviews

Interview Techniques: Prepare thoroughly for interviews, whether with locum agencies or healthcare facilities.
Questions to Ask: Have a list of questions ready to assess the suitability of potential assignments.

Financial Considerations

Negotiate Pay: Understand the typical pay range for locum tenens anesthesiologists and be prepared to negotiate.
Tax Considerations: As an independent contractor, be aware of your tax obligations. Consulting a tax professional is advisable.

Setting Up for Success

Logistical Considerations: Plan for travel, accommodation, and adapting to new work environments.
Professional Support and Resources: Utilize resources available for locum tenens anesthesiologists, including professional organizations and mentorship programs.

Physicians in Highest Demand

These are the specialities with the highest demand for locum tenens.

Anesthesiologist

You can't operate without one. I expect the demand for anesthesiologists to continue increasing as a large portion of the most experienced in the field start retiring soon. Now combine that with the same retiring baby boomers generation needing increasing amounts of medical care.

Pediatrician

With a growing focus on early childhood development and preventive care, the demand for skilled pediatricians is expected to rise significantly.

Psychiatrist

There is an increasing focus on mental health, psychiatrists are in high demand, particularly in areas with limited mental health services.

Neurologist

Neurologists help people with brain and nerve problems, like headaches or Alzheimer's disease. As more people get older and need this kind of care, we're going to need more neurologists.

Urologist

There's a growing need for specialized care in areas such as prostate health and kidney function ensures a steady demand for their expertise.

After Graduating Residency or Fellowship

If you're a physician fresh out of residency or fellowship then locum tenens work can be a strategic choice for physicians looking to pay off medical school debt faster.

It offers a unique opportunity for new physicians to gain diverse clinical experiences, flexible scheduling, and higher pay rates compared to permanent positions.

It's perfectly okay to try a lot of different opportunities in order to learn what works best for you.

Working with Locum Recruitment Agencies

Job Matching

As a physician, you'll benefit from the agency's expertise in identifying and suggesting locum positions that align with your specialty, experience, and personal preferences. This tailored approach helps ensure that the positions you're offered are a good fit for your skills and career goals.

Credential Verification

Your agency helps in verifying your credentials, licenses, and certifications, ensuring they meet the requirements of the locum position. This service streamlines the verification process, making it more efficient.

Application Assistance

You'll receive guidance throughout the application process for locum positions. This includes help with completing necessary paperwork and documentation, making the application process less burdensome.

Contract Negotiation

Your agency negotiates contract terms on your behalf, including pay rates, duration of the assignment, and work hours. This ensures that the terms of your contract are in your best interest.

Licensing and Credentialing Support

Agencies provide support in obtaining any state licenses or specific credentials required for your locum position, simplifying what can be a complex and time-consuming process.

Travel and Accommodation Arrangements

Your travel and accommodation for assignments are often organized and funded by the agency. This service allows you to focus on your professional responsibilities without the stress of logistical planning.

Orientation and Onboarding

You'll receive orientation information or facilitation for onboarding processes with the hiring facility, ensuring a smooth transition into your new role.

Payment Collection from Facility

Your agency handles the collection of payments from the healthcare facility where you are placed. This service ensures that you receive timely and accurate compensation for your work, without the need for you to directly engage in potentially complex and time-consuming billing processes with the facility. The agency acts as an intermediary, managing financial transactions to provide a streamlined and hassle-free payment experience for you.

Malpractice Insurance

Agencies typically provides or facilitates malpractice insurance for the duration of your locum assignment. This critical coverage protects you against legal claims related to your medical practice during the assignment, ensuring that you have the necessary protection while you provide care.

Ongoing Support and Communication

The agency serves as a continuous point of contact, offering support and communication throughout the duration of your locum assignment.

Payroll and Tax Assistance

Managing payroll services and offering guidance on tax-related issues for locum positions are part of the agency's services, easing the administrative burden on you.

Schedule Coordination

The agency assists in coordinating your schedule, ensuring a balance between your professional commitments and personal life.

Resolving Issues on Assignment

In case of any issues or conflicts that arise during an assignment, the agency acts as a mediator to help resolve them, ensuring a smooth working relationship.

In-depth Market Insights and Advice

You'll receive knowledgeable insights into the current job market helping you make better decisions.

Renewal and Extension Negotiations

If you wish to continue at a placement, the agency handles negotiations for contract renewals or extensions, advocating for your interests.

Contracting Directly with the Hospital

It is possible to negotiate your own locum tenens contract with a hospital. Since it can be overwhelming to manage, I only recommend it if you already have extensive experience as a locum.

Our section above under "Starting a Locum Assignment Step-by-step" is a great overview of the process.

Malpractice Insurance

This type of insurance is designed to protect you, as a temporary physician, from legal claims alleging medical malpractice during your locum assignment.

Your locum agency will provide this for you, but you'll need to always double check the details.

Coverage Scope: Covers malpractice claims during locum assignments, including medical errors and omissions.
Tail Coverage: An add-on for claims-made policies, covering post-policy period claims for incidents that occurred during the policy period.
Claims-Made vs. Occurrence-Based Policies: Claims-made covers claims filed during the policy period, while occurrence-based covers incidents during the active policy, regardless of claim filing time.
Policy Limits: Determined by specialty risk level and employer requirements, with variable limits.
State Variations: Coverage requirements and regulations differ by state.
Duration of Coverage: Matches locum assignment duration. Check for necessary coverage overlaps.
Legal Representation: Most policies include legal representation for covered claims.
Reporting Procedures: Immediate reporting of incidents or potential claims as per policy guidelines is important.

Personal Health Insurance

As a self-employed contractor, you are responsible for securing your own health insurance.

You'll typically have this covered if you continue to have W-2 employment or if your spouse has health insurance through their job.

For those without these options, as a self-employed physician, you will need to explore other avenues for health insurance. This includes:

Individual Health Insurance Plans: These are available through the Health Insurance Marketplace. As a self-employed individual, you're eligible to purchase a Marketplace plan, and you may even qualify for special savings based on your income.
Professional Associations or Groups: Sometimes, professional medical associations offer group health insurance plans to their members.
Private Health Insurance: You can also explore private health insurance options outside of the Marketplace.

Financial Planning for Self-Employed Physicians

1099 Taxes for Physicians

As an independent contractor, you'll be working with the employment status of 1099.

Physicians on W-2 status are considered employees, with employers handling tax withholdings and paying a portion of payroll taxes. In contrast, 1099 physicians are independent contractors responsible for their entire tax burden, including self-employment taxes. This status requires more proactive tax planning.

Tax Deductions for Doctors

Take advantage of these deductions to lower your tax liability.

Travel Expenses: Deductible costs for travel to work locations, including airfare, car rental, and mileage.
Lodging: Deductible expenses for hotel stays or other temporary housing while on assignment.
Meal Expenses: Partial deductions for meals during work assignments.
Licensing Fees: Costs for obtaining additional state medical licenses.
Continuing Medical Education: Deductible expenses for attending relevant conferences and seminars.
Professional Dues and Subscriptions: Membership fees for medical organizations and relevant professional subscriptions.
Medical Supplies and Equipment: Deductions for any medical supplies or equipment purchased for work use.
Communication Expenses: Partial deductions for business-related cell phone and internet bills.
Insurance Premiums: Deductible costs for professional liability or malpractice insurance.
Home Office Expenses: Deductible portion of home expenses if managing locum tenens activities from a home office.
Vehicle Use: Deductions for using a personal vehicle for traveling to assignments.
Contract Labor: Costs for hiring assistance for your locum tenens business activities.
Retirement Plan Contributions: Deductions for contributions to qualified retirement plans.

Solo 401(k) Advantages

The Solo 401(k) plan is an ideal retirement savings option for self-employed physicians, particularly those working as locum tenens. It offers higher contribution limits and tax advantages like tax-deferred growth and potential deductions on contributions. This plan suits independent contractors, enabling them to significantly bolster their retirement savings compared to traditional retirement accounts.

A key feature of the Solo 401(k) is the flexibility in investment choices, including stocks, bonds, mutual funds, and sometimes real estate, allowing physicians to personalize their investment strategy.