Locum Tenens Co-op: Survey Response Report
A number of you responded, taking the survey and leaving thoughtful comments. Thank you for those. Today, I’ve got the team back to report the survey results and to respond to a number of the comments.
Read on to see the positive responses to the concept of a member-owned physician locum tenens co-op, and how the co-op could address the concerns of the survey takers.
There will also be an opportunity to share a survey designed for hospitals and groups that are responsible for hiring locum tenens physicians to fill open positions. The remainder of this post is written by the Locum Tenens Co-op Team.
Locum Tenens Co-op: Survey Response Report
A few weeks ago we floated the idea of creating a technology-enabled locum tenens co-op. If you have not seen the post, it can be found here.
Kudos to you all and our friend PoF. We started to get responses to the survey as soon as the post was published. In fact, by 8 AM or so we had already received over one hundred responses.
(We promised a $10 gift card to the first 100 respondents. The gift cards were emailed out two weeks ago. If you submitted the survey before 8AM and have not received the card, please check your spam folder. If you do not have it there, please email the post to us at [email protected]il.com and we will figure out a way to get it to you)
As this is written, we have about 227 responses. At this sample size, we believe the trends are set and additional data may not significantly alter the results.
In a nutshell, most of you enthusiastically support the idea. But, let’s drill deeper into what you said before laying out the inferences and next steps. Here is the response data:
- We believe the survey results indicate pretty strong support for the idea and would be sufficient to raise the capital needed to launch and become operational.
- There appears to be enough commitment from the respondents to create a reasonable amount of ‘shifts inventory’ available in the marketplace to get employer attention.
- Respondents are apprehensive about employer buy-in. A majority say that the employers may ‘give it a try’ but may not necessarily make the switch in a committed way.
- It will be far too risky to start anything until we gauge employer interest.
We will continue to work on the legal/operations and to define the structural framework.
Our research tells us that Minnesota may be the best state to incorporate. There are many law firms that specialize in this type of work and can help us create the structure and set this up.
We have a very concrete plan on the technology side of things. We have a handle on lining up people who will operate the co-op (management, sales, support) and we feel confident that we can engage some thought leaders (guess who we are thinking of!) among physicians to help champion this!
However, will need to engage the law firms and plan this properly. Before we do that (and spend some serious money), we need to gauge employer sentiment via a similar survey.
Here is what we’ve come up with: Employer Survey: A Physicians Co-op for Locum Tenens Services
Since there are no social media influencers that we know of among medical practices, we have no easy way to publish this survey. We could try to spam them by getting their emails via some lists but believe that would be against the spirit of the co-op! Plus we may not get to the right people.
So how do we feel their pulse?
Would you be willing to help us by forwarding the link on to any decision-makers from hospitals and practices that you know?
Once we have the responses, we will publish those for you as well. We will review and discuss the results of the survey with you and come to a “go” or “no go” decision!
Survey Comments and Responses
While we did not receive a single comment that said this was a downright bad idea, some of you had some specific and well thought out concerns. Here are those selected comments and responses for your consideration:
I think that your startup costs are way too high. This could be started out of a home office with somebody’s spouse that stays at home. You are also speaking of shifts only. I am in urology and most locums assignments are weekend or week long. you may need to change the terminology some.
I negotiated my own contract for locum work. it is done locally. I was somewhere between what they wanted to pay me and what they would pay locums. Interesting project, make sure you get some docs with real-life business acumen on board. I would change your pitch to start out with fewer docs at a higher buy-in. Use surgery center models or lithotripter models in urology as the base. Make it a buy-in on the company and less of a co-op.
- Our startup costs are high because we are trying to create a professionally operated, automated technology platform. Not a small locums company. This should be ready to scale in months. If it lingers on, we feel it will not take off.
- The platform should accommodate different rate structures… even among shifts. It should allow day/night/holiday rates variance, pager rates, shift premiums for Christmas etc., a way to negotiate a per case model ( Anesthesia!), and this goes back to the high set up costs.
- We really are committed to a Co-op model, so if this model does not appear to be workable, we will not move forward.
Nowhere in the introduction were travel expenses, hotels, nor malpractice insurance addressed.
The technology platform should help do expenses for travel (that physicians can book themselves) and invoice as a passthrough to the employers. ‘All inclusive’ is another option that the platform may support. where physicians negotiate higher rates but pay their own travel and expenses.
Malpractice & Credentialing
This is an intriguing model. I have not done Locums because my kids were younger. But now that I am in mid 50’s would do it. What about malpractice and credentialing? And licensure? I suppose that is taken into account in the 15% booking fee?
This definitely warrants further investigation. Anytime we as doctors can get big business out of our pockets it will be better for all: patients and docs alike. Keep me posted.
Response: Please see the response above for travel/malpractice. As to credentialing, the technology should support document repository and exchange. The co-op staff could facilitate as necessary.
Some of the survey questions have too few possible responses with too abrupt a gradient, i.e. “I will strongly insist to be recruited through the Co-op” and the next choice is I will not try to persuade my prospective locums employer”. Otherwise, I’m all for a locums solution that works in a fiduciary capacity for locums physicians.
The locums marketplace is very difficult to navigate as an individual physician and many are forced to rely on predatory locums agencies. I do think that the Co-op finances would have to be transparent to members in order to maintain trust. When our own speciality boards have huge salaries and cash cows called MOC, I think most docs will be a bit gun shy.
Response: Agreed. We did not involve any professional statistician or pollster. some questions could have been rewritten for better insights. Also agree that the transparency is key. Co-op structure is good because there are regulatory requirements that the cooperative keep books and records and shareholder lists. Pursuant to statute, the shareholder lists are available for inspection by shareholders for a proper corporate purpose. But shareholders also have a common law right to inspect the ‘books and records’ of the cooperative. The coop can and should, on top of that, define its bylaws to bring greater transparency that can not be revoked by the board.
Limited to Certain Specialties?
I am very intrigued by the idea, but wonder if it lends itself to certain areas of medicine like shift based work such as Anesthesia and Emergency Medicine. I also worry about travel costs and licensing fees that the members may inquire and if that is being factored into the equation.
Response: Please see answer above about travel and expenses. As to being skewed toward EM/HM, we feel that it can work for everything. Perhaps EM/HM may lead it in getting off the ground but with properly deployed technology, even telemedicine would work.
I think you need buy-in from different subspecialties. Only if you have a balance of that can you market it to a wide group of hospitals.
Member-Owned versus Physician-Owned
I think this is a great idea, and I’ve actually mused about it several times myself. I would change the title of your post to something like “Member-owned locums company” as opposed to “physician-owned” as many privately-held staffing agencies advertise themselves as “physician-owned” when they are anything but democratic.
Response: We will get the nomenclature right in the subsequent documents.
Quality of Physicians
I am super concerned about certain physicians investing money and being locked in to working with them. We occasionally have locum physician and they may do one shift with us and never returned due to their lack of quality or their poor social skills.
When you lock a physician in with a buy-in, you are committing to working with them for the long haul. Be careful!!!! Sometimes it is hard to vet these physicians beforehand, so I would make sure you have some way to get them out of the co-op. Good luck!
The co-op bylaws should be written to allow the board to terminate the membership for cause. This is another reason we do not want to rush into this. Ours is a litigious society. We need to do everything by the book.
Gaining Traction & Credentialing Database
I think this is a fantastic idea. I am a full-time locums physician and despise having to deal with recruiters all the time. The biggest barrier I see is being able to connect with hospitals and clinics around the country to convince them that this is a better option and gain some traction in the space. I believe there would be a significant marketing expense.
One more note- would be great if all of the data and necessary paperwork (CV, licensure, DEA, etc. and maybe even a standard accepted form to confirm completion of residency) is uploaded centrally and provided to the clinics and hospitals with one easy click. I have seen a few locums companies taut that they do this, but it has never worked well. Again, great idea and I look forward to seeing where this goes!
Response:: The technology platform must have the capability of managing these documents, monitoring expiry, sharing with employers etc.
As to marketing, yes, initially recruiting members and getting job contracts will require expenses. But the power of unity will mean this will be very efficient. The survey respondents said that they will advocate the co-op strongly!
A Fee to the Hospitals?
I was thinking of doing something similar with an Uber-like platform for physicians looking for Locum positions and hospitals trying to fill their open shifts, charging the hospitals a yearly membership fee.
Response: We are considering an annual fee for hospitals to help offset operating costs. We are also considering a much larger upfront contribution in exchange for a reduced booking fee. Let’s see if that works.
Licensing & Insurance
I would wonder which party would handle licensing and insurance in such a coop. My shift participation would probably be lower in early years compared to later years. I would be most interested in doing shifts close to where I live by not too close so as not to compete locally.
Response: We can have a tie-up with third parties for licensing help, life certifications etc. The costs will be directly paid by physicians or coop board may decide that coop does it. Please see the response above for Malpractice.
What do the Thought Leaders Think?
Interested, but would definitely need to see the thoughts of leaders in this field (WCI, PoF, etc.) as well as the hard questions answered. Esp. what is the incentive for hospitals to use this co-op rather than traditional locums companies, as well as what happens if “commitments” are not met, attrition, etc…
Response: This will not take off without champions on both sides. We know people on the physician side! We need a few thought leaders on the medical practices side too! If you know any possible candidates, please provide an introduction via [email protected]
[PoF: I think this is a great development and I hope to see it come to fruition. As I said in the prior post from the co-op consortium a month ago, I probably lined the pockets of several locums agencies with a couple hundred thousand dollars doing several years’ worth of locums.]
Locums for the Non-Shift Worker
As a surgical sub-specialist (urology- men’s health, male infertility, andrology. I do general urology as well though), I don’t necessarily work “shifts”. Have you thought of a way to integrate surgeons into this model as well as the “shift workers” (ER, anesthesia, radiology, etc…)? I would be very interested in investing but it might be harder to integrate us…
Having a well-designed platform and vetted members (board qualifications, etc…) will go a LONG WAY towards making this successful. With sufficient feedback, this can change the market
Response: That’s exactly what we are thinking and that’s why we want to invest in technology. The play here is not to start a mom and pop locums company!
[PoF: Whether or not you think of yourself as a shift worker, you do come and go from the clinic and / or hospital. It may be a shift of indefinite length, but it’s a shift. Anesthesia positions with home (or hotel) call are very common in locums. You get paid for covering a period of time, which could be 24 hours to 168 hours with additional pay if you go into the hospital.]
Managing attrition is key; most physicians aren’t looking for a lifetime of temporary job assignments. Trying things on, looking for the right temp to perm opportunity, deciding on a location to settle in, not having a ton of life direction right out of residency, being single and not owning property yet, etc. is I think why many if not most are looking for locums work. These things change over the months and years.
Response: If the co-op has critical mass, the variations are dampened. Just like deep water is calmer. So we will not move forward unless there is critical mass.
Response: Agreed. Please see another similar question above We will have a vetting process in place for members and non-members who want to work via the co-op.
Hospitals need something value added from Co-Op that locums companies cannot provide.
Response: We think the value-adds will be costs saving (15% booking vs 30 to 40% margins by traditional locum companies), quality physicians, and a good hedge against shift availability.
Who’s the Boss?
Lots of owners may mean it’s not clear who is in charge. Lots of potential for mismanagement. Getting clients and physicians to sign up may be much harder than you expect.
Response: Co-op structure supports all this. It is a ‘solved problem’. Many co-ops in the world have membership over a million!
We agree it is not simple. If it were, it would have been done already! But we are committed provided we know the risks and the path.
Licensing & Growth Strategy
The strategy should include multiple specialties and regions. May consider subcontract to licensing agencies initially with eventual in-house licensing staff.
Response: We are thinking about outsourcing licensing to a third party, but our technology will allow all document exchange etc. But that is, of course, a possibility. We are thinking high tech automation and lean operations. Not a bloated bureaucracy.
The most important data point will be reimbursement rates. If this is a huge network that can negotiate excellent reimbursement based on the total number of docs in the group, it will be very successful. Or will the coop leave reimbursement/billing up to the facilities, and focus simply on staffing?
Response: We would focus simply on staffing. The physicians will negotiate their pay rate with facilities and coop will pay the physicians and charge the practices. That’s it. The reimbursement will be outside our purview.
[PoF: Facilities should be willing and able to pay you more when not having an agency take 30% to 40% off the top.]
What about Dermatology?
I do worry that some specialties will be more heavily weighted in the pool of jobs, and smaller specialties such as Derm will not have jobs posted. I say that because FB locums groups and other general locums groups have very few Derm spots. That would be my only hesitation to investing. I cannot perform any other specialty positions.
Response We agree. Which prompts another idea: perhaps have membership commitment levels based on the market size? That way dermatologists can become members and get dividends, but do not have to commit to shifts at the same level at the expense of not getting the cash-back?
PoF: After reading all of questions and responses, I imagine you have come up with some more of your own. Please ask them below. Also please consider forwarding the latest survey to the decision makers at your institution.