As a health facility, the challenge of balancing your budgets while maintaining quality patient care is prevalent. One critical decision that healthcare facilities must make pertains to medical staff. A sizeable token of your budget goes to the staff, and it’s a critical aspect of management.

Facilities have to decide whether to hire full-time employees or use locum tenens, temporary or contract workers, to meet their staffing needs. This blog will explore the pros and cons of both approaches and help you understand the true cost implications of hiring locum tenens versus full-time staff.

Hiring Locum Tenens as Staff And Why it Works

Locum tenens are temporary workers, contracted by health facilities to fill gaps until full-time employees resume duty. But why opt for locum tenens in the first place?

Flexibility

Locum tenens offer you flexibility, simple. Healthcare facilities can quickly adjust their workforce to accommodate fluctuations in patient volume, seasonal demands, or sudden staffing shortages.

This flexibility allows healthcare organizations to maintain an appropriate medical staff-to-patient ratio without the long-term commitment and cost associated with full-time employees.

Cost Savings

Locum tenens staff can often be more cost-effective than hiring full-time employees. Your health facility can save on expenses which include benefits, training, onboarding, and administrative costs.

Although locum rates appear more expensive, you can bet on more financial prudence.

Specialist Expertise

Locum tenens providers frequently bring specialized expertise to healthcare facilities. These temporary workers can fill gaps in specialized care areas.

This can be particularly valuable in rural or underserved areas where recruiting full-time medical staff may be challenging.

Reduced Administrative Burden

Managing full-time employees can be strenuous, coupled with hiring and onboarding. With locum tenens, healthcare facilities can reduce the paperwork and time associated with HR processes.

You can focus on more patient care services and improving your facility’s operations.

Opting for Full-Time Employees as Medical Staff

Many facilities follow the tradition of full-time employees taking charge of operations. As cliche as it may sound, full-time employees are beneficial due to the services they offer in the short and long term.

Continuity of Care

One of the main advantages of hiring full-time employees is the continuity of care they provide.

Patients often prefer seeing familiar faces during their healthcare journey, and long-term medical staff members can establish strong patient-provider relationships, leading to improved patient satisfaction and outcomes.

Lower Training Costs

While locum tenens providers may be experienced, there is still an investment in training and orientation required when they join a healthcare facility.

Full-time employees, on the other hand, undergo initial training and can continue to develop their skills over time, resulting in lower overall training costs. Financial resources you’ve saved can fund other facility projects in the long run.

Long-Term Cost Predictability

Hiring full-time employees allows healthcare facilities to predict their labor costs more accurately over the long term.

This predictability can be advantageous for budgeting and financial planning, reducing the uncertainty associated with locum tenens rates, which can fluctuate based on market demand.

Staff Loyalty and Engagement

Full-time medical staff often have a stronger sense of loyalty and engagement with their healthcare facility.

They are more likely to invest in the organization’s mission and goals, contributing to a positive workplace culture and staff retention. This can be crucial in reducing turnover costs.

Calculating the Cost

To determine whether you are really saving with locum tenens versus full-time staff, it’s essential to conduct a thorough cost analysis. Consider the following factors:

Salary and Benefits

Compare the total compensation packages of full-time employees (including salary, health benefits, retirement plans, and paid time off) to locum tenens rates. As you compare, factor in the long-term costs for your facility.

Some staff may seem costly at the moment of analysis, but a broader view reveals vital accruing expenditure.

Recruitment and Onboarding

Factor in the costs associated with recruiting, onboarding, and training new full-time employees. Training medical staff is essential to improving medical services in a health facility.

Sooner or later, training has to be conducted to address new and existing challenges. Include expenses such as advertising, interviewing, background checks, and orientation.

Administrative Costs

Calculate the administrative costs related to managing full-time employees, including payroll processing, HR staff salaries, and compliance management.

Although salaries and benefits have already been tabulated, administrative costs are unavoidable and are as important. Pro Tip: Seek external expertise when necessary to ensure your costs are well accounted for through transparent audits.

Productivity and Turnover

Account for the potential costs of staff turnover, including recruitment expenses, temporary staffing during gaps, and the impact on patient care and satisfaction. Locum tenens benefit as a result of temporary staffing, but your financial constraints should be prioritized if the option is not plausible. Lack of familiarity with the medical staff affects patient satisfaction.

Opportunity Costs

Consider the opportunity costs of not having the flexibility to adjust staffing levels quickly with locum tenens. Evaluate whether this flexibility would result in increased revenue or better patient care. Opportunity costs should benefit your facility’s patient care standards.

Quality of Care

Assess the impact of staffing choices on patient outcomes, satisfaction, and the overall quality of care provided. As stated, patients prefer familiar faces and services. Therefore, changing workers regularly to cater to vacant slots may impact the quality of care and patient contentment.

Finding the Right Balance for Your Hospital

In most healthcare facilities, finding the right balance between sustainability and medical staff recruitment is key to optimizing both cost-effectiveness and patient care. Consider the following strategies:

Utilization Data

Analyze historical utilization data to identify peak demand periods and seasonal trends. Data will enable you to note the areas of consistent understaffing. Use this information to inform your staffing decisions.

Hybrid Approaches

Explore hybrid staffing models that combine full-time employees with locum tenens providers during high-demand periods. This approach can offer flexibility while maintaining continuity of care.

Although it may seem expensive for your facility’s needs, the quality of care and improved services outweigh any administrative and financial concerns.

Contract Negotiation

Having locum tenens doesn’t negate the need to have stable contracts in place. Negotiate favorable locum tenens contracts that align with your budgetary constraints and long-term staffing needs. Consider establishing partnerships with locum agencies to secure competitive rates.

Workforce Planning

Develop a robust workforce planning strategy that considers both immediate and long-term staffing needs. This approach can help you make informed decisions about hiring full-time staff in areas of chronic need.

The choice between using locum tenens or hiring full-time employees as medical staff in healthcare facilities is not one-size-fits-all. Each approach comes with its own set of advantages and challenges. To determine if you are truly saving with locum tenens versus full-time staff, it’s crucial to conduct a comprehensive cost analysis while considering the unique needs and goals of your healthcare facility. Ultimately, the key to medical staff recruitment is finding the right balance that ensures high-quality patient care while maintaining financial sustainability.