What value do the locum companies provide to the psychiatrist?

[the5thelement]

I know for a fact that they bill between $300-400/hour but the psychiatrist only sees $150-170 of this.
If there is a bad outcome, psychiatrist takes all the risk. They make $200+/hour off the psychiatrist
back for basically "match-making" and for being in the middle , reaping all the benefits but having no skin in the game.
Why cant that money go directly to the person who is putting their license on the line?

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[WisNeuro]

I know for a fact that they bill between $300-400/hour but the psychiatrist only sees $150-170 of this.
If there is a bad outcome, psychiatrist takes all the risk. They make $200+/hour off the psychiatrist
back for basically "match-making" and for being in the middle , reaping all the benefits but having no skin in the game.
Why cant that money go directly to the person who is putting their license on the line?

Because there are plenty of people who are willing to accept the arrangement as is?

 

[splik]

I wouldn't recommend taking a locums paying $150-170 unless it was really cush (even then it is way too low). they should pay for your accommodation, malpractice, and travel expenses where indicated. They should help expedite credentialing. They should get you a competitive rate.

The way you are thinking about it makes it sound like they are stealing money from you. Try and negotiate directly with the institution and in the majority of cases you will find it unlikely you will get a better deal, and almost no one is going to pay you the hourly rate they are paying the locums company. Many of the most lucrative positions are for government run entities like state hospitals, prisons, jails and so on where in many instances it is not even possible to directly negotiate with the institution, there has to be a middle man. However I have heard of people sometimes negotiating directly with private institutions a good rate better than if they used a locums agency.

I have seen locums positions paying $340/hr through locums. If you were a direct contractor it would be $140/hr.

Nomad health is an agency that supposedly cuts out the middle man and lets physicians directly negotiate rates with the hiring facility. From what i have heard, it is useless and was a failure for physicians.

I have never done locums (though have used them for hiring and can tell you we paid more to the psychiatrists/NPs with locums than if they had been hired directly) but the agencies I have seen paying best are Jackson and Coker and Imperial Locums.

 

[Merovinge]

I wouldn't recommend taking a locums paying $150-170 unless it was really cush (even then it is way too low). they should pay for your accommodation, malpractice, and travel expenses where indicated. They should help expedite credentialing. They should get you a competitive rate.

The way you are thinking about it makes it sound like they are stealing money from you. Try and negotiate directly with the institution and in the majority of cases you will find it unlikely you will get a better deal, and almost no one is going to pay you the hourly rate they are paying the locums company. Many of the most lucrative positions are for government run entities like state hospitals, prisons, jails and so on where in many instances it is not even possible to directly negotiate with the institution, there has to be a middle man. However I have heard of people sometimes negotiating directly with private institutions a good rate better than if they used a locums agency.

I have seen locums positions paying $340/hr through locums. If you were a direct contractor it would be $140/hr.

Nomad health is an agency that supposedly cuts out the middle man and lets physicians directly negotiate rates with the hiring facility. From what i have heard, it is useless and was a failure for physicians.

I have never done locums (though have used them for hiring and can tell you we paid more to the psychiatrists/NPs with locums than if they had been hired directly) but the agencies I have seen paying best are Jackson and Coker and Imperial Locums.

To add to this, some/many organizations have setups where they cannot directly pay a physician above x$'s related to some rules they have (or not wanting to raise pay for other docs in the organization) but can pay locum's agencies literally unbounded amounts of money. The economist in me cries when seeing this in practice and it's pretty clear why these agencies are so numerous given the financial rewards. Feels like recruiters and locum's agencies are the most recent cosmetic companies when it comes to margin.

 

[Trismegistus4]

To add to this, some/many organizations have setups where they cannot directly pay a physician above x$'s related to some rules they have (or not wanting to raise pay for other docs in the organization) but can pay locum's agencies literally unbounded amounts of money. The economist in me cries when seeing this in practice and it's pretty clear why these agencies are so numerous given the financial rewards. Feels like recruiters and locum's agencies are the most recent cosmetic companies when it comes to margin.

There is something about the Stark laws that says--or at least makes these organizations believe--that they will get in trouble if they pay a physician more than a certain percentage higher than the MGMA average or whatever. I've never quite understood it.

 

[comp1]

I just want to know how to get them to stop contacting me.

 

[nexus73]

Hospital will pay a huge premium to locums company because the contract is not with the doctor. The locums doctor can be let go with a moments notice (not typical), without worry about lawsuits alleging wrongful termination, because they're not terminating a doctor, they're terminating the contract with the locums company. Even with 1099 contracts they don't have this protection. And as mentioned already, the hospital fears investigation from the Office of Inspector General if they "overpay" doctors. But you can "overpay" a locums company, who then "overpays" a doctor, and can also justify it as an urgent/temporary need to bypass this problem.

The "over payment" concern arises from unethical arrangements that doctors and hospitals have engaged in in the past. For example, a cardiologist gets paid a $300K medical director stipend from hospital, and agrees to have his group refer all business (imaging, labs, procedures) to that hospital. The hospital generates $10 million off these referrals. The argument is $300K is too much for a medical director and clearly is a quid pro quo for referrals. In my opinion it's unlikely a similar situation could occur in psychiatry. I think it's more likely the hospital would bribe the psychiatrist to not refer his patients, but instead refer his patients to competitor hospitals. But despite this, hospitals have a pretty strict across the board fear of "overpaying" doctors, even in high need areas where higher pay for psychiatrists would be justified by market forces.

 

[nexus73]

I just want to know how to get them to stop contacting me.

Tell them you're a sex offender

 

[splik]

There is something about the Stark laws that says--or at least makes these organizations believe--that they will get in trouble if they pay a physician more than a certain percentage higher than the MGMA average or whatever. I've never quite understood it.

Nothing to do with Stark law (which is about physician self-referral). Also by definition there must be people making in the 75th, 90th, and 99th percentile of MGMA/AMGA/Sullivan Cotter etc. There is something call fair market value, and essentially if your salary is not deemed "fair market value" then it could look as if you were being bribed. This is part of the anti-kickback statute, which is often confused or conflated with Stark Law. I find it hard to see outside of possibly addictions, how this applies to psychiatry. However it is often used an excuse for those that do not want to pay competitively.

 

[Trismegistus4]

Nothing to do with Stark law (which is about physician self-referral). Also by definition there must be people making in the 75th, 90th, and 99th percentile of MGMA/AMGA/Sullivan Cotter etc. There is something call fair market value, and essentially if your salary is not deemed "fair market value" then it could look as if you were being bribed. This is part of the anti-kickback statute, which is often confused or conflated with Stark Law. I find it hard to see outside of possibly addictions, how this applies to psychiatry. However it is often used an excuse for those that do not want to pay competitively.

According to this site, the "fair market value" requirement comes from the Stark law.

 

[dl2dp2]

I know for a fact that they bill between $300-400/hour but the psychiatrist only sees $150-170 of this.
If there is a bad outcome, psychiatrist takes all the risk. They make $200+/hour off the psychiatrist
back for basically "match-making" and for being in the middle , reaping all the benefits but having no skin in the game.
Why cant that money go directly to the person who is putting their license on the line?

You are right. However, given that not enough psychiatrists are directly negotiating with facilities for work, locums continue to have value.

Locum agencies are less common in large group-based specialties like EM, where usually there are dominant regional contract management organizations that people tend to work with. Locum agencies become more like traditional job placement agencies. Our specialty is just not organized around it--large facilities typically do not have large group psychiatry contracts (though this isn't uncommon either, a good example is a few threads down described by vistaril), and psychiatrists are very commonly lone gunmen with lots of mobility. This generates a lot of value for the existence of locum agencies in our field.

 

[Psychresy]

I just want to know how to get them to stop contacting me.

Go back in time and create a separate email address for job hunting.