19 Feb Locum Tenens as a Cost-Effective Staffing Strategy for Healthcare: Addressing Persistent Staffing Shortages through 2025
With unfilled physician positions costing hospitals significant amounts in lost revenue, a flexible staffing solution is essential. This is where locum tenens physicians come into play. Utilizing locum tenens can help healthcare organizations save money and maintain efficiency during staffing shortages.
Healthcare facilities are feeling the strain of ongoing physician shortages. The numbers are concerning. According to the Association of American Medical Colleges (AAMC), up to 86,000 physicians will be shortfall by 2036. This shortage can lead to longer patient wait times, decreased quality of care, and increased stress for existing staff.
Overview: Defining Locum Tenens
Locum tenens refers to licensed physicians who temporarily fill in for regular staff. As MDs and DOs (including psychiatrists), PAs, NPs, and psychologists, these medical professionals can work in various settings—from hospitals to private practices. Main features include:
• Flexibility: Healthcare organizations and practices can hire locums for short or extended periods, providing staffing solutions tailored to their specific needs.
• Varied Specializations: They are credentialed to work in many specialties, from primary care to surgical fields.
• Credentialing: Annashae and other agencies manage the locum tenens credentialing process, ensuring quick placement.
Types of Locum Tenens Physicians and Their Specializations
Various types of locum tenens physicians exist, each specializing in different areas. This diversity of specializations allows healthcare facilities to find the right match for their particular needs. Common specialties include:
• Emergency Medicine: Ideal for hospitals facing urgent care needs, whether due to staffing shortages or to cover for vacationing staff.
• Pediatrics: Useful for practices needing temporary increases in staff during the start of school or outbreaks of sicknesses such as the spring and fall flu seasons.
• Internal Medicine: Perfect for primary care practices with a high percentage of older patients.
Filling Immediate and Long-Term Needs
Locum tenens can address both urgent and long-term staffing requirements. They fill gaps due to illness or sudden staff departures for immediate needs. For long-term requirements, they can provide support to practices while they recruit for permanent roles. This flexibility can help stabilize the facility’s healthcare delivery during times of significant change or need.
Cost Analysis: Comparing Locum Tenens to Permanent Physicians
While contracting out for locum tenens services may seem costly at a glance, analyzing the direct costs of hiring permanent staff reveals a different picture. Permanent hires require salary, benefits such as paid days off, and various overhead expenses, including:
• Healthcare benefits such as insurance and retirement plans
• Recruitment costs, including agency fees and/or job posting advertisements.
• Verifying the doctor’s credentials
• Conducting background checks
• Onboarding: Training new hires can be expensive and time-consuming
• Orientation including training
• Technology setup and equipment
• Administrative overhead costs such as completing and filing paperwork
• Annual continuing medical education required for the job.
Using locum tenens can reduce these direct and indirect costs significantly. Administrators can avoid long recruitment processes and save facilities’ resources. Recent studies show that the average cost to recruit a permanent physician exceeds $1 million when considering salary, benefits, and lost revenue from the unfilled position.
On the other hand, a locums arrangement can cost significantly less in direct and indirect expenses. For instance, many hospitals have saved approximately 25 percent compared to hiring permanent physicians during staffing shortages. These figures offer strong evidence supporting the cost-effectiveness of locum tenens.
Benefits Beyond Cost Savings: Improved Efficiency and Flexibility
Locum tenens often bring diverse experiences and specialized skills. This can temporarily elevate patient care, especially for facilities requiring specific expertise. For example, hiring a locum cardiologist might enhance heart treatment delivery in a community hospital.
Having locum tenens on board can also improve operational efficiency and reduce administrative burdens by streamlining operations. With fewer administrative tasks related to recruitment and onboarding, staff can focus on patient care. The result is a more efficient, productive environment that benefits everyone.
Healthcare facilities frequently face fluctuating patient volumes, especially during times of seasonal illnesses. During peak seasons, such as flu season, locum tenens can provide essential staffing support, and ensure that patient needs are met without overburdening existing staff.
Healthcare organizations can minimize potential drawbacks by streamlining processes to reduce the likelihood of operational challenges. This includes working with Annashae and agencies experienced in credentialing and ensuring smooth onboarding. Setting clear expectations and communicating with current staff and temporary hires can also enhance integration.
Ensuring Continuity of Care
To ensure continuity of care, healthcare facilities hiring locum tenens professionals should establish best practices. Maintaining comprehensive patient records outlining procedural expectations can help them to provide consistent care. Regular meetings between permanent and locum staff can also facilitate knowledge sharing.
Planning for the future can also extend your facility’s continuity of care. Incorporating locum tenens into your staffing strategy may significantly improve your facility’s bottom line. Connect with Annashae today to explore savings opportunities in 2025 and beyond.
