Eskridge Associates

The ROI for Hiring Locum Tenens

For many healthcare executives paying close attention to their bottom line, hiring a temporary physician can be a hard pill to swallow. However, in many situations, hiring a locum tenens physician can prove to have a larger return on investment than most would initially think.

Consider these scenarios

It may be hard to wrap your head around, but there are several distinct scenarios where hiring locum tenens is better for your ROI than hiring a permanent physician.

  • Maybe your practice is growing and as a result, reaching capacity. You wonder whether or not it’s time to hire another physician, but you’re uncertain if your patient volume is growing quickly enough. You could spend the money recruiting a new physician and paying their salary, but what if your patient volume doesn’t budge fast enough to support it? Your new physician might be likely to sit around while you invest, only to have them grow restless a few months later and leave to accept another opportunity. If this situation occurs, you’ve lost both time and money on a risk. Instead, you could opt to hire a locum tenens physician to see if your volume grows. Because this physician is temporary, you can easily decide later whether it’s beneficial to hire someone permanent while also giving your staff the break from full capacity that they deserve.


  • The current specialty shortages make it tougher than ever to recruit new associates to help cover operations and help your practice’s profitability. When you’re desperate for new associates to help your current staff with coverage and you’re finding yourself closing operations due to lack of coverage, you’re likely feeling pressured to find someone and fast. However, finding and hiring the right person is important for your practice, but the physician shortage opens the door for many candidates to try to call the shots and require salaries and benefits you simply can’t afford to promise. Hiring temporary physician coverage can help you solve the issue with lack of coverage while also saving your pockets from being completely emptied in the process.

There’s more to the equation than dollar signs  

Still, some executives and healthcare providers remain unconvinced that hiring locum tenens is better for their ROI. When paying for travel, housing, and overtime for on-call duty and more in addition to paying the daily rate for these physicians, it can be hard to see the numbers move in your favor. However, it’s often forgotten that a practice is saving by not having to pay the employer’s portion of FICA, benefits, malpractice premiums and CME expenses. When you factor in the non-monetary benefits of having proper physician coverage to improve the wellness and productivity of your employees, hiring a locum tenens physician suddenly becomes a smart investment. Wouldn’t you agree?

The ROI when hiring locum tenens increases when you consider how the temporary physicians can help a healthcare practice attract and retain patients. For example, patients continue to have high healthcare expectations as they become more educated (and sometimes more demanding). Patient and referring physician satisfaction and retention are important for any practice because patient retention is necessary for continued growth. When patients are forced to reschedule or wait too long because there’s no one available, they can quickly become dissatisfied and move to switch providers. If you consider maintaining high patient satisfaction ratings along with physician retention and satisfaction ratings necessary for success, you should consider making locum tenens coverage an integral part of your medical staff plan, too.

Providing your permanent physicians and staff with coverage means they’re provided with the opportunity for work-life balance, less stress and as a result are less likely to suffer from burnout, which means higher employee retention rates. This is excellent for your bottom line because finding a replacement for your staff on short notice can become costly to healthcare providers – sometimes as much as three or four times the salary of the physician you’re recruiting.

In order to grow your medical practice, you must recognize the non-monetary benefits of hiring locum tenens, which includes maintaining full physician coverage to ensure your staff isn’t reaching burnout faster and helping your practice stay in compliance with managed care and other third-party agreements.

Being a NALTO member is important

The National Association of Locum Tenens Organization is an excellent resource for locum tenens companies, clients, and physicians. They were established in 2001 to create and enforce strong industry standards and practices for the locum tenens profession. NALTO and its company members offer the highest standards in the industry and they’re committed to protect and support the best interests of all parties – physicians, companies, and healthcare facilities. The NALTO standards of practice ensure the best possible working relationship between these parties.

Many healthcare facilities have experienced first-hand the ROI locum tenens physicians can provide for them because estimated data shows that three-quarters of all hospitals use locum tenens physicians in addition to their permanent medical staff. Whether it’s just to provide a few weeks of coverage or to help facilitate a growing practice, implementing a strategy to hire locum tenens is a smart investment for your growing facility. For more information on how you can add locum tenens to your practice, contact us today.

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