Locums

[rockyhill99]

Hello,

I am looking into my first locums job and the locums agency has asked me to sign a PSA before they present my CV to the employer. The job is seeing 10 patients/day with developmental disability/intellectual disability for one day/week.

I do not know the employer name yet and the agency said that once my name is cleared by the employer, they will inform me of the name. The agency rep said that signing the Provider Service Agreement(PSA) is the only way to proceed. Is this standard with locums jobs? Are there any potential problems with signing a blanket PSA with a specific locums company? Thanks in advance.

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[Candidate2017]

I would not engage with a locums company that does not tell me the name of the client they are representing.

Every locums company has an agreement with their client-hospital where the client is barred from directly hiring a temp doctor whom the locums company presents to them, unless a period of time has passed or if the client pays a finder's fee (i.e., 2 year period or a fee equal to 20% of salary). It's important to ask locums who is the client prior to agreeing to let locums send your CV.

Let's say you intend to apply for employed work with a certain hospital, but once you tell locums to send your CV to the hospital, the hospital must pay the finder's fee if they wish to employ you directly. And the hospital may balk at hiring you. I know a hospital that refused to consider a psychiatrist for direct employment because their CV was already presented to them.

It's important to verify whether the client is a specific hospital/facility vs. an entire hospital system. For example, if your state has only 5 large hospital systems, letting locums send your CV to all 5 systems will saddle all 5 systems with a finder's fee if you wish to be employed by them in the future.

I do know of one facility that paid the 20% finder's fee for a psychiatrist to hire them directly. But I wouldn't count on it happening all the time.

 

[comp1]

I completely get the headhunter need from the employer side. There is a horrific shortage of providers. I do NOT get it from the physician side. Can't you just call any given hospital or clinic you want to work for? They have a job...

 

[rockyhill99]

Random calls like that do not generally result in jobs for physicians. Been there done that.

 

[rockyhill99]

I would not engage with a locums company that does not tell me the name of the client they are representing.

Every locums company has an agreement with their client-hospital where the client is barred from directly hiring a temp doctor whom the locums company presents to them, unless a period of time has passed or if the client pays a finder's fee (i.e., 2 year period or a fee equal to 20% of salary). It's important to ask locums who is the client prior to agreeing to let locums send your CV.

Let's say you intend to apply for employed work with a certain hospital, but once you tell locums to send your CV to the hospital, the hospital must pay the finder's fee if they wish to employ you directly. And the hospital may balk at hiring you. I know a hospital that refused to consider a psychiatrist for direct employment because their CV was already presented to them.

It's important to verify whether the client is a specific hospital/facility vs. an entire hospital system. For example, if your state has only 5 large hospital systems, letting locums send your CV to all 5 systems will saddle all 5 systems with a finder's fee if you wish to be employed by them in the future.

I do know of one facility that paid the 20% finder's fee for a psychiatrist to hire them directly. But I wouldn't count on it happening all the time.

They are willing to disclose the name once the provider service agreement is signed but the issue is that as a physician I am signing a blanket PSA without an employer name. They say it is standard practice in their company and they need the PSA signed to forward my name and CV to the facility. They note it is not binding and once the facility name is disclosed and I get to talk to them, I can decide to decline or move forward per my preference on the final offer.

 

[nexus73]

I completely get the headhunter need from the employer side. There is a horrific shortage of providers. I do NOT get it from the physician side. Can't you just call any given hospital or clinic you want to work for? They have a job...

You can call but unlikely to get locums rates. They will want to hire you was w2 employee, or contract as a 1099 and pay "fair market value" which is likely a 40% or more haircut vs locums rates.

 

[littlefred]

You can call but unlikely to get locums rates. They will want to hire you was w2 employee, or contract as a 1099 and pay "fair market value" which is likely a 40% or more haircut vs locums rates.

I always wonder why the hospital admins cut a fat check for locums but skim out when handling contracts with the doc one on one.

 

[comp1]

Is there really such a huge pay difference between a locums job and a 1099 job you got through the hospital? It just makes no sense since the hospital already has to pay a significant cut of your salary to the locums company bypassing you entirely. And in terms of cold calling, I know my hospital hires that way fairly often. In this market, you have to grab every lead you can get.

 

[nexus73]

I always wonder why the hospital admins cut a fat check for locums but skim out when handling contracts with the doc one on one.

It’s easier to cut ties with the locums company than with a doctor directly. If the locums doc isn’t working out ask to have a replacement and locums company can get one more readily. Some risk exposure firing a doctor for cause, doctors can sue the hospital and cause various degrees of headache. Not true with locums where they’re not firing the doctor, just dropping the staffing contract with locums. Also avoids fair market value issues because hospital is paying locums company not a doctor. What locums pays the doctor isn’t the hospitals concern.

 

[ObsequiousAplomb]

I always wonder why the hospital admins cut a fat check for locums but skim out when handling contracts with the doc one on one.

my cynical view is that hospital admins are used to cutting fat checks to other administrators and abhor the idea of doctors making anywhere near what the admins make.

 

[Merovinge]

I always wonder why the hospital admins cut a fat check for locums but skim out when handling contracts with the doc one on one.

So it depends based on the place, but say you have 3 docs making $300k/year, they will gladly pay $450k to a locums agency rather than pay $350k on a regular basis to a 4th doctor for worry of the other docs finding out and wanting higher salaries. It's also simply less effort to hit the locums button rather than actually go through the work of recruiting a permeant doc.

 

[MedMan80]

It’s easier to cut ties with the locums company than with a doctor directly. If the locums doc isn’t working out ask to have a replacement and locums company can get one more readily. Some risk exposure firing a doctor for cause, doctors can sue the hospital and cause various degrees of headache. Not true with locums where they’re not firing the doctor, just dropping the staffing contract with locums. Also avoids fair market value issues because hospital is paying locums company not a doctor. What locums pays the doctor isn’t the hospitals concern.

This exact thing happened at my place, crummy locums doc was out within a week or two. Problematic attending took 3-4 months, +lawyers to get rid of.....

 

[Trismegistus4]

I always wonder why the hospital admins cut a fat check for locums but skim out when handling contracts with the doc one on one.

One reason no one has mentioned yet is the Stark law. I'm not sure of the reasoning, and it might not seem to make sense since it's not a kickback, but paying a physician more than "fair market value" violates the Stark law. You would think, if a hospital pays a locums agency $350 per hour, and the locums agency pays the doc $200 per hour, why can't the doc just approach the hospital directly and say "hey, let's eliminate the middleman, you pay me $275 per hour, I'll make more money and you'll pay less money, we both win!" The reason is specifically that it's a Stark law violation.

Edit: I see @nexus73 did allude to this.

 

[Sushirolls]

Which then alludes to who is the biggest benefactor of the salary survey companies? MGMA and ilk? The organizations that pay for their surveys, and the ones that are most likely to fill in reports for their survey accumulation. i.e. MGMA is not vested in getting private practice non-Big Box shop survey data results, which could skew things higher. So the very entities that shape "Fair Market Value" are in line with the entities paying it, which is suppressing it...

Another point for private practice.

 

[splik]

One reason no one has mentioned yet is the Stark law. I'm not sure of the reasoning, and it might not seem to make sense since it's not a kickback, but paying a physician more than "fair market value" violates the Stark law. You would think, if a hospital pays a locums agency $350 per hour, and the locums agency pays the doc $200 per hour, why can't the doc just approach the hospital directly and say "hey, let's eliminate the middleman, you pay me $275 per hour, I'll make more money and you'll pay less money, we both win!" The reason is specifically that it's a Stark law violation.

Nope. Stark law is about physician self-referral for Medicare patients. There is an anti-kickback statute that is often conflated with Stark, but the issue of what actually constitutes FMV is a bit vague though those companies like MGMA will say FMV compensation is between the 25th and 75th %ile. Fact is, 25% of people make more than the 75th percentile (and thus outside of what might be considered FMV compensation) and this is not a violation of any law. When I was in academics, I was in the 99th %ile for my academic rank for psych and there was nothing illegal about my compensation.

Many places will cite FMV as a reason they can't pay you more, but it is all nonsense. Don't fall for it. If they need to pay $400/hr to fill a position, that is what they need to do. Of course, if they can't afford that, they won't but it's nothing to do with FMV.

 

[comp1]

Yeah, the law is not the issue...