Vlad Dzhashi, MD
- Have you ever struggled to keep your locum tenens job for a long time?
- Have you ever wondered how to create a flexible schedule without traveling away from home?
- Have you ever felt it was a big pain in the butt to learn a new EMR and adjust to a new hospital?
If yes…I’ve got a revelation for you: there’s ONE viable alternative that leads to a high-paying, flexible hospitalist career without a lot of annoyances that locum tenens have.
…PER DIEM
In the last couple of years, I’ve seen more and more hospitals ditching staffing agencies and offering per-diem positions. At a lot of hospitals, this may be your only option if you are looking for flexible work.
Today, I am about to show you everything you need to know about working as a per-diem hospitalist.
By the end of the post, you’ll decide for yourself if per diem is “locum tenens on steroids” or a total waste of your time.
Table of Contents
What does per diem mean for hospitalists?
Per diem (also called PRN work, or sometimes more loosely “moonlighting”) refers to the direct agreement between a physician and a hospital (i.e., without involving a locum tenens agency).
A hospitalist can work on a regular basis but doesn’t have to commit to any particular number of shifts.
In turn, a facility will give the hospitalist hospital privileges without guaranteeing any shifts either.
As you can see, per diem is a very flexible setup for everybody.
Per diem vs. locum tenens
Pros of per diem when compared to locum tenens:
- Long term (years)
- No need to travel, as you can find “gigs” close to home
- Partial benefits are sometimes available (typically retirement plan matching once you’ve reached a certain number of shifts per year)
Cons of per diem when compared to locum tenens:
- Expenses are not tax deductible
- Pay rate is “fixed,”and hard to negotiate
- More work is required on your part to find per-diem jobs
A per-diem contract completely eliminates staffing agencies from the equation and creates a win-win situation when you can have a long-term relationship with the hospital employer.
- Let me explain:
When considering temporary and flexible work, the default approach has always been to involve a locum tenens company.
The staffing company would search for the assignments and take care of some of the hassles for you, such as arranging your travel, helping with the paperwork, etc.
However, you have to realize that hospitals are paying a 30-50% (sometimes more) premium to these companies on top of your hourly rate. As a result, your services are costing them a fortune, and they will never rely on you for a long time unless they have no other options.
Obviously, hospitals WILL get rid of you as soon as they hire permanent physicians or encourage their own hospitalists to take the shifts by paying them a premium.
And…that’s why most locum tenens gigs last several months to a year, which means you have to change hospitals and travel on a regular basis.
Unlike the scenario with a locum tenens agency, the per-diem hospitalist hourly cost would be very close to the one of the full-timer. That’s why you can effectively become one while keeping your flexibility.
Per-diem job security:
Per-diem jobs can last pretty much FOREVER, which makes them SO ATTRACTIVE to “flexibility-seekers.”
Of course, any PRN job will have its own ups and downs in the shifts’ “supply,” as all hospitals go through different phases – swinging between having a full house to losing a bunch of docs in one massive “exodus.”
That’s why the real secret to making it work is to have multiple per-diem contracts on hand.
Word of caution here: once, probably 5-6 months after signing a per-diem contract with a big local hospital,I received a surprising email letting me know they terminated my contract.
WHY? It turns out they were not happy that I hadn’t picked up a single shift. Honestly, the hospital was in my “tier 2” bucket, so I wasn’t too keen on working there.
So keep in mind that this is a possibility and plan accordingly: i.e., show up at least occasionally.
Another caveat, unlike some short-term locum tenens gigs, per-diem hospitalists are expected to ACT LIKE A FULL-TIMER, so make sure you are performing well with your billing, quality metrics, teamwork and communication, as a lot of hospitals will not tolerate a low-quality job for too long.
Ditch the travel:
There’s another HUGE advantage of working per-diem, assuming you live in a mid to large size metro area: you’ll DITCH the travel part for good!
If you follow the steps I describe below, you can reliably have 14+ shifts a month within a commutable distance from your home. For most hospitalists, this is more than enough.
Spending nights in the comfort of your home, getting quality family time is a BIG DEAL.
You are less likely to burn out and will recover quicker from your long shift stretches compared to working away from home.
Also, once you’ve learned all the ins and outs of your local hospitals (including EMR, overall hospital culture, consultants, admission, and discharge process, etc.) you won’t have to go through the painful process of figuring out the system over and over again.
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- Sign up for my coaching to access:
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- Unique resources
- No stress
Per-diem hospitalist pay rate:
As I wrote in my earlier post, pay rate will always depend on the location of the facility, type of shift (day vs. night vs. swing) and how much work is involved (ICU, patient census, etc.).
For example, in the metro Seattle area, the daytime pay rate is about $155-165 hr., whereas a similar job in rural WA towns would be $10-15/hr higher.
On average, it’s very similar to what you would get if you worked with agencies.
Having said that, some hospitals are willing to pay much higher rates (I’m getting $190/hr at one facility) just to avoid dealing with locum tenens companies.
As to negotiating per-diem pay rates, I’ve got BAD NEWS for you: I’ve never had much luck. It seems that they are pretty much “fixed”: you effectively become a W2 employee and every hospitalist in the group has to be paid equally.
Which takes me to the next point.
Per diem and taxes:
- Per-diem contract means you become an employee for tax purposes, which means two things:
- No more locums tax deductions, including mileage reimbursement and health insurance premiums.
- You won’t qualify for the Tax Cuts and Jobs Act (TCJA) business deduction either (It was rolled out in 2018 and that year it saved me almost $20K in taxes).
On the plus side, your employer pays half of your social security taxes; to be exact, that’s $8,537.40 if you make above $137,700 annually (2020 data).
Overall, pure W2 will likely give you higher taxes than pure 1099 (as opposed to combined W2 and 1099 income), although it does depend on your taxable income. The higher your income, the lesser the difference is between W2 and 1099.
Per diem vs “direct” locums:
“Direct” locums are very much like per diem except for taxes, as you have an independent contractor status.
Most of those jobs are offered by large national hospitalist companies. I’ve worked with one of them extensively in the past (I won’t name names, but I am sure you’ve all heard of it).
Overall, other than taxes, you get the same benefits as working with hospitals, i.e. you can work on a long term basis.
Per diem vs. part time
Pros of part time when compared to per diem:
- Can get full benefits (typically if you are more > 0.5 FTE)
- Always have guaranteed shifts
Cons of part time when compared to per-diem:
- May be difficult to get extra shifts
- Schedule is not as flexible
Now, another option for laid-back “freedom-seekers” is part-time jobs.
The main advantage is that you typically get health insurance, 401k matching and other benefits (as long as they are more than 0.5 FTE), but….you lose control over your schedule.
What do I mean by that?
Let’s say that a part-time gig will have the same problems as a full-time one, except you’ll have much more “calendar” time to work around those issues.
You won’t get to choose what shifts you want or don’t want to do (e.g., night, swing, etc.) and your 7 days on can fall on holidays and the days you REALLY need to off.
You’ll definitely be able to have lots of time off, but this will require much more coordination (for instance,. swapping shifts with somebody) compared to the per-diem schedule.
Another drawback: you are getting only 7 shifts a month, and a lot of hospitals frown upon you taking extra shifts (you’ve signed up only for 7 after all). Which means…you’ll likely get NONE…
So, you’ll need to look for per diem or a locum tenens job on the side…
There’s lots of flexible hospitalist work options out there:
- Check out the table below (click on the image to expand) to compare them.
Onward…
How to find per-diem jobs as a hospitalist:
Now, it’s time to plunge into the exact process of how to find locum tenens jobs without involving a staffing agency.
Finding per-diem work using good old referrals:
Let me tell you…referrals work like MAGIC!
Hands down, this is the best way to find per-diem jobs! That’s why networking is SOOOO important.
Here’s how I do it: talk to your colleagues who’ve worked at other local hospitals in the past…ASK FOR FREAKING REFERRAL!
It will make your life MUCH easier and will open many doors.
Let me tell a story here:
I used to work closely with a private nephrologist who covered three local hospitals. When I mentioned that I was interested in “moonlighting,” he gave me the personal (!!!) cell phone number of a chief hospital recruiter.
Do you know how long it took me to have a per-diem contract signed?
A WEEK!!!
This is literally the fastest way to land a job!
Other “low-hanging” fruits are your “OLD” HOSPITALS where you used to work. As long as they are still within your reach, there’s a good chance they will hire you on the spot too.
FInding per-diem work online:
I’ve got three favorite online platforms, or methods, here to find potential “targets”:
1 – Practicelink.com:
My favorite site to find the targets.
Here’s why: this site has DIRECT listings from the facilities actively looking for hospitalists.
Whenever you see that, it means they likely need extra help (expanding, lost providers, etc.) and may be open to the per-diem idea.
Plus, you can send direct messages using their platform which makes communication much smoother.
So…what you need to do is to select a “hospitalist” in a drop-down menu and select your target state or states.
Make sure “Employer job” is selected, and you’ll see both hospital employed jobs as well as hospitalist companies listings.
2 – Linkedin:
LinkedIn has LOTS of job postings, but the system is clunky. Lots of times you’ll be referred to some old crappy job board where you have to fill out pages with personal info before you can even get in touch with the recruiter.
3 – Google search:
This is more of a “shotgun” approach where you can search hospital systems (e.g., Google search, Google maps, “list of hospitals in Pennsylvania” in Wikipedia, etc.) in your area of interest and then check their websites directly. These sites usually have dedicated “provider or physician jobs” links with the contact page and the name of the recruiter.
MAKE CONTACT
Once I collect contact info, I typically send an email (see the example below). When using Praticelink, you could also send an internal message. Feel free to copy and paste the following to your email or cover letter. Just add your name, phone number, and the recruiter name.
I send the following message:
Hello,
My name is Dr. XYZ. I am a local hospitalist looking for a new job.
I came across your job posting ***. Please let me know when we could discuss the job details. I can be reached at ***.
For your convenience, I’ve attached my CV to this email.
Thank you in advance.
Best regards,
Please note I DON’T mention I’m looking for a per-diem job:
The trick is to get the recruiter on the phone first and then ask if they’d hire you as a per-diem. In my experience, it works MUCH better.
If you’ve been referred by another physician, make sure you mention them in the email, e.g., “I spoke with my colleague, Dr. Smith, and he recommended *** Hospital as a great place to work.”
If you are an experienced physician, you can make the message even more powerful by adding: “I am a local hospitalist with 10+ years of experience…” or ”I am an experienced hospitalist…”After you send an email, I strongly suggest you call the facility soon afterward.
If you don’t get a response, you can also use LinkedIn as a last resort to send a direct message to either the hospitalist program medical director or the recruiter.
Now, I have to admit that this approach is far from ideal: you will NOT hear back most of the time (unless it’s a referral).
That’s why you need to contact MULTIPLE hospitals, and don’t forget to include hospitalist companies.
My story
When I first started locum tenens, I worked with several well-known staffing companies. I LOVE working locums so MUCH that I decided not to go back to permanent employment.
At the same time, I’ve always disliked the travel part of it, AND since my wife was pregnant back then, I wanted to be at home every day.
I decided to give it a try and called around to local hospitals to see if they would be interested in my services.
To my surprise, the response was positive and I signed a contract with two local hospital systems and a national hospitalist company. I was told they needed somebody to cover “occasional” (turned out to be quite frequent) openings.
Since then, I’ve worked per-diem 50-60% of my time and the rest is locum tenens out of town or in a different state.
Final thoughts
I hope this info is helpful!
Thank you for all this info Locumguy! I have a few questions that I would appreciate if you can answer:
1. How realistic is it to easily sign per-diem contracts with local hospitals in major metros (ex: LA, Austin, Orlando, NYC, etc)?
2. Even if someone does sign per-diem contracts, do these contracts produce reliable work for years to come? Or will the well eventually dry up and force someone to eventually do travel locums or a permanent FT job?
3. Do hospitals want to keep their per-diem contracts or are they looking to terminate you as soon as they get a permanent physician?
Thank you!
MS3 Student, Hi!
These are all good questions!
Here’s what I think:
1. How realistic is it to easily sign per-diem contracts with local hospitals in major metros (ex: LA, Austin, Orlando, NYC, etc)?
I definitely think it’s realistic since I’ve done it myself for the last 5 years in the pretty competitive Seattle job market.
Having said that, every city/state job market is different. For example, I know for a fact that you can find lots of per diem positions in SF area and much less in greater LA area.
You could try to estimate the number of those positions by googling words “per diem” and “prn” hospitalist or use job boards (e.g. https://bit.ly/2TuOVaU or https://bit.ly/2Se6kYz – please note this search found 2 jobs in greater LA area and more in other prestigious metro areas), but the problems is that lot of them are not advertised anywhere.
So the best way to find them is to actually pick up the phone and give local hospitals a call
2. Can per diem shifts dry up? Yes, they can!
Now, the only way to minimize this is to sign up with multiple local hospitals since they will inevitably have ups and downs in terms of demand for per diem physicians.
From my personal experience, the shifts never dried up completely since I am connected with 4-5 different programs/hospitals. In the worst case scenario, you can find a locum job out of town for a couple of months until shifts open up again.
Another thing you can do is to get a part-time hospitalist position so that you commit to only 7-8 shifts a month. The rest of the month you could work as per-diem/locum. This way you can get benefits (health insurance, retirement plan), have a piece of mind and still have a great deal of flexibility.
3. Hospitals always prefer to be fully staffed and not use per diems or locums, but s**t happens: people leave, census spikes during high season, hospital systems acquire other hospitals and revamp the program completely, etc.
Unsurprisingly, this creates an endless turmoil that always leaves uncovered shifts, sometimes more, sometimes less.
The good thing about per diem contract is that your hourly cost might be a little higher or even the same as the permanent docs (since you are not getting any benefits) and hospitals tend to treat their per diems well, knowing that they can call on them at the times of the higher demand.
E.g. I now work for the hospital system that gives out open shifts to per diem doctors first and only then to full-timers.
Again, this is a mutually beneficial relationship: per diem docs create a nice staffing buffer (much cheaper than locums since no staffing agency and travel expenses involved) for the hospitalist programs, and we get a flexible job close to home.
I hope it helps!
Thank you so much for the info! I was just wondering about malpractice insurance. I know if you are going through a staffing company, they generally cover that, but if you are working per diem with the hospital you are working for cover you?
M1student, Hi!
Yes, that’s correct. The hospital will add you to their group malpractice insurance.
In that sense, it’s not much different from your typical full-time employment.
If you are working directly for the hospital as a per diem, do you still get paid hourly? If so, what are average pay rates?
Zach, Hi!
Per-diem pay rates are negotiable and probably fall within the same range.
Some larger hospital systems may have “fixed” per-diem rates while others let you negotiate.
One of the selling points I always try to bring up when I negotiate with the facility is that I save them money by not involving the locum agency.
I use this as an argument to justify a higher hourly rate.
Great post. A few questions
– When you ask for per-diem gig, what if the hospital tries to suck you into W2 PRN employee position which has no tax benefits rather than a 1099 independent contractor position?
– How do you encounter if they say – we provide malpractice insurance only to your employed physicians and not independent contractors?
– How do you negotiate the holiday rate, overtime rate, mileage and hotel reimbursement?
– What time of contract do you get into with the hospital? They all have PRN W2 employee contracts handy but I don’t think they have knowledge of a professional services agreement or an independent contractor agreement. Could you please share a sample on your blog?
– How often do you submit the invoice and how long do the hospital typically take to reimburse?
– Have you succeeded in including a 30 day notice clause by either parties to walk away from the committed shifts?
Looking forward to hearing your responses.
Ash, Hi!
I know it may sound like a shock to you and although locum tenens pretty much always would make you more money, it’s not always more favorable from the tax perspective.
Check out the tax calculator I created to figure this stuff out.
Plug in the same income as pure W2 and then as pure 1099 income. Make sure you add all the possible deduction for 1099 income and decide which way is better for you. Believe me, I may be surprised.
One big hospital system I work for is employing me as W2 prn hospitalist. I am pretty happy about that. I get access to lots of shifts close to home.
Answering your question: If they only employ per-diems only as W2s, then that’s probably the only way for you to create a long term relationship with them.
As a per-diem, I get paid every two weeks, typically 7-10 days after submitting my hour log.
30-day notice clause?
In one of my per-diem contracts, it was already mentioned.
In another agreement, it wasn’t mentioned. I knew the medical director from working at that hospital in the past and we just agreed that 30 days sound good.
Had I not known the guy, I would have tried to add it to the contracts.
Locum Guy,
Thanks for the information. Had a quick question. When you have done direct locum work, negotiated by you and the facility (excluding the locum agency), how did you negotiate malpractice insurance. Did they agree to cover you through the hospitals group insurance or did you have to get the insurance yourself? Note that Ash above asked a similar question but I don’t see that you answered it. Thank you in advance for any assistance.
Stefan
Stefan, good question.
Your malpractice insurance is typically covered if you’re signing a per-diem contract (i.e.W2). If you work as direct locums (i.e.1099) then you may need to purchase your own malpractice insurance. Check out my malpractice insurance guide on how to do that.
I hope it helps!
Vlad.
Thank you for your input!
-Stefan
Great article.
I would like to ask for your opinion in regards to my situation.
I am a hospitalist working in a small town. I completed my J1 waiver and currently waiting for my Greencard. My goal is to find a city with more diversity in terms of culture to settle down. Thus the plan is to do locums in different cities until I find a suitable one while working on my permanent W2 job. What is your thoughts on that, and how do you think I should start?
Thank you in advance.
Very information especially about W2 vs 1099, though I wonder why it has to be W2 when they are not paying any benefits as Per diem and why is the pay similar to fulltime hospitalist when they don’t pay your 401k, health insurance etc shouldn’t it be higher (somewhere between a fulltime and Locum company costs). Isn’t that exploiting a doctor who wants to work directly as I know many hospitals who pay Locum companies 300$/Hr shouldn’t they be happy paying the Doctor directly 230-250/hr and have long term relationship.