If you are starting to explore locum tenens work, you may be wondering how pay rates and compensation is determined. There are a lot of factors that help to determine what your rate will be but at the end of the day, depending on who you are working with, they should be negotiable and flexible. Since my specialty is General Surgery and Trauma, I’ll be primarily focused on these rates and giving some insight into what most surgeons and hospitals use to base rates on.
The bill rate is just what it sounds like, the amount that we bill a client for hiring a locum tenens provider through our agency. This rate is a) the rate we are compensating the surgeon + b) malpractice (varies from 25-49% depending on the region + c) our markup (pays for a team of specialists such as the recruiters, hospital privilege personnel, credentialing experts, travel agents, etc; and our markup).
General Surgery Rates:
Here are some of the types of rates we see for General Surgeons:
- 24 hour call ‘split rate’ – The surgeon receives a base rate to be on call, and an overtime rate in addition. Typically the client will want the surgeon to include 2-4 (gratis) hours with the base rate, then the overtime kicks in after the included hour. For example a split rate may be $900 per day, plus $150 per hour after 4 hours. The surgeon makes $900 whether or not he gets called in. Any hours he/she gets called in is called a ‘callback’. In the above example, every hour after 4 hours would be an additional $150 per hour.
- 24 hour call ‘flat rate’ – The surgeon receives a set rate for 24 hour call that includes any call backs. The upside to a flat rate is guaranteed income for the shift, also we can typically negotiate a flat rate higher than a split rate. A flat rate works out in the surgeons favor if the facility is slower, but not if unexpectedly busy.
- Clinic shift – we bill the client for an 8 hour day, and we pay for an 8 hour day. There should be an overtime rate included should the shift go over 8 hours, or a flat rate that is all inclusive.
- Pager fee – if the assignment includes clinic shifts (clinic/call shift) and the surgeon is on call that evening, we can bill and pay for a pager fee. During a clinic/call shift, overtime applies after the shift ends and/or any call back hours during the evening. Typically clinic/call shifts do not include any gratis hours.
- Holiday premium – typically we will pay time and a half for any of these holidays: Memorial Day, July 4, Labor Day, Thanksgiving, Christmas Day, New Year’s Day. We do not contractually bill for any other holidays, but it is possible to negotiate a holiday rate on other days should the client agree, and should be negotiated at the time of present.
Trauma typically pays more than general surgery shifts and are also structured differently.
- In House or Primary Call – Typically the surgeons are paid an hourly rate for ‘in house’ or ‘primary call’, for example $150 per hour ($1800/12 hour shift, $3600/24 hour shift).
- Back Up Call – Some trauma facilities have a ‘back-up’ call shift in between primary shifts, the rates are structured like a General Surgery 24 hour ‘split rate’ (example: $900 per 24 hour back up call shift, with $150 per hour after 4 hours).
- Example – so perhaps there is a 5 day assignment with 3 primary shifts that are 24 hours, with 2 back up shifts in between. 3 x $3600 + 2 x $1000 would be = $12,800 before any call back hours on the back up shifts.
How do I come up with my rates?
The truth is most recruiters aim to bill the client as high as possible and bargain with a surgeon to get the lowest rate possible, therefore getting the highest daily margin possible. I believe that rates should be a combination of the following:
- It should be a rate that is engaging and enticing to the surgeon, I usually ask ‘what will it take to make this worth your while?’ as a starting point.
- It should be competitive with what other surgeons are being presented for, at the end of the day it is a market and there is no reason to price yourself out or waste time with unrealistic rates.
- It should be reasonable for the client. In most cases, the client will pay more for a good surgeon and a good locums company, but we do need to be able to show that we are worth it.
Don’t fall for ‘bait and switch rates’:
We often hear of other locums companies that significantly higher than average rates. This doesn’t mean this is the rates the surgeons are actually getting. Sometimes locums companies say they will be able to get you high rates, then once you miss out on a few deals, say that you are missing out because your rates are too high and ask you to come down. I prefer to be as up front as possible about rates rather than compromising trust and promising something I cannot deliver on.
Billing For Services:
Occasionally we get surgeons asking if they are allowed to ‘bill for services’. In most cases (I haven’t seen otherwise yet), the client bills for services. We do not get involved with any billing of services, we pay the bill the client and pay the surgeon for his time, not productivity.
Get In The Door, Then Get A Raise:
Some surgeons prefer to be presented at an ‘introductory rate’ to get in the door with a plan to get a higher rate down the road. This works fine so long as clear expectations are set. If you agree to a rate, continue through all booked assignments at that rate. After you have completed any assignments at the agreed rate, in the future it is fine to ask for a higher rate but make sure you have shown yourself to be a valuable asset to that facility and create your own demand.
Once you have completed a CompHealth assignment and have credibility with our company and our clients, it is definitely worth presenting at higher than average rates. Our clients trust us to find the best surgeons for their needs, and once you have an established relationship with our company, we can push for you to get in to a facility over other unknown surgeons. Flexible, friendly and responsive is just as important as clinical skills.
Now let’s build an ongoing and sustainable relationship built on trust!