Frustrated by pain-in-the-you-know-what HMOs and the threat of universal care, many doctors are cutting back their workloads or bailing out altogether. The percentage of physicians in part-time practice jumped from 13% in 2005 to 19% in 2007, according to a recent survey by the American Medical Group Association. The same survey notes that young doctors between 35 and 39 make up the highest percentage of doctors working part-time.
One company earning some greenbacks from this trend is LocumTenens.com, a niche agency that pairs physicians seeking part-time or temporary work with hospitals desperate to fill staff positions. The 110-employee company is projecting revenue of $150 million in 2008.
Many of its customers are hospitals or physician groups in rural America, which chronically struggles to attract top doctors. The company also serves community-based clinics, veteransâ€™ hospitals and prisons.Â Its recruiters seek out specialists in five hospital moneymakers: surgery, cardiology, anesthesiology, radiology, and psychiatry.
â€œWe made a decision when we opened up the firm 13 years ago to dedicate ourselves to the higher profit, higher demand specialtiesâ€ that are major profit centers for hospitals, says Pam McKemie, the companyâ€™s senior vice president.
There was a time when hospitals didnâ€™t have to market their services, but those days are long gone. Aggressive advertising is the norm as hospitals vie with one another to convince consumers that their high-end facilities and specialists are the best.
Advances in medical-imaging technology, coupled with a growing number of baby boomers who will need services, are fueling growth of the locum tenens industry. Many doctors view locum tenens – a Latin term that means â€œto stand in place ofâ€ — as a way to extend their careers while working fewer hours. According to a survey by Vista Staffing Solutions, another locum tenens provider, 82% of physicians view the arrangement as ideal for easing into semi-retirement.
Based near Atlanta, LocumTenens.com makes its money through placement fees charged to hospitals. Doctors are treated as independent contractors who get subcontracted to hospitals. The fee typically is based on a number of factors, including a doctorâ€™s daily rate for working an eight-hour shift. About 80% of the fee goes to the physicians hired on a locum tenens basis.Â
LocumTenens.com keeps the rest to cover a host of administrative tasks associated with getting doctors on staff, including credentialing, licensure, housing, transportation, and purchase of medical-malpractice insurance.
Its job site attracts about 100,ooo unique visitors a month, roughly 95% of whom are physicians, McKemie says. Should they choose, physicians could bypass the companyâ€™s third-party recruiters and contact hospitals directly about a placement.
LocumTenens.com has company. In addition to a handful of competing niche recruiters, larger staffing firms such as Adecco and AMN Healthcare have moved into the locums market in recent years. The locum tenens industry accounts for nearly $2 billion in the U.S. in 2007, according to the research firm Staffing Industry Analysts. Various estimates suggest the U.S. faces a shortage of physicians during the next decade or so, although there is considerable debate among experts as to its severity.