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Planning for a Career Transition to Locum Tenens after Being an Employed Physician

  • May 3
  • 9 min read

As physician demographics change and frustration with traditional employed models mounts, more and more physicians are looking to add flexibility to their schedules or find a way to practice medicine without some of the pressures associated with an employed position. For those physicians who also have flexibility to travel, the ability to earn more money through locums assignments is also a compelling reason. As such, we find the number of questions in our online physician communities from physicians wondering if locums life is right for them or seeking advice as they make the transition increasing. Below, we explore the things a physician should be planning for before making the switch to making locum tenens their primary means of income.


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8 considerations when timing your switch to locums work


How do I know if locums life is right for me?


Locums life is NOT for everyone. For starters, some physicians may not have the ability to be away from home on a regular basis, and it’s hard to guarantee that they will find enough per diem or locums opportunities in their backyard. But even if you do have that flexibility, you’ll want to consider other things, such as those in the picture below and discussed in more detail on our dedicated article about if locums life is right for you.  It’s very important to understand the tradeoffs that you will be making when leaving a steady job with a steady paycheck, benefits, and more.


Is locums right for me? Who locum tenens work may (and may not) be a good fit for


Determining the timing for your transition from an employed position to locums life


The very first thing you need to do is to take stock of where you are, financially, personally, and professionally, so you can create a timeline for the transition. In general, the smoothest transitions to locums will happen when it’s a choice that isn’t financially stressful or otherwise very disruptive to your family.



Emergency fund, savings, and financial buffers

Understand that it may take a while to ramp up your locums portfolio to the point where you have regular gigs. You likely need to be able to maintain at least 3-6 months worth of expenses in the off chance that there’s a significant income gap, which may be secondary to not finding enough gigs, delays in credentialing, delays in payments, etc.


Things to consider include:

  • Do you have enough of an emergency fund that it doesn’t matter if you don’t make money for a set amount of time?

  • Do you have a spouse or significant other, or family, etc. that can help support you financially as you make the switch?

  • Do you have any side income streams that can float your expenses in the interim?

  • Are you comfortable with liquidating savings from your investments if you need to? Be careful about this!


If you need a financial advisor to help you with this planning, we have a database of financial advisors for physicians trusted by many in our online physician communities. 



Housing


If you are in a situation where buying a house is on the horizon? Know that it will be very challenging to apply for a mortgage as a 1099 or locums physician. Banks value security and see locums life, especially when unproven, as a liability. Many locums physicians struggle with securing mortgages during their early mortgage years, so consider buying the house before you make the switch.


Read more about this in our dedicated article about mortgages for locums physicians.



Outstanding debt


Many people like to have larger fixed expenses settled before moving to a phase where income can come in waves or is unpredictable. If you have a large student loan debt burden, a large mortgage, or other substantial debt, it may make sense to wait before making the switch.



Family considerations


There may be certain periods of your life where being away from home are less disruptive to your family’s flow and needs. Similarly, the lack of workplace benefits, particularly if you depend on very good health insurance, may be more palatable at certain points in your career or your family’s life.



Timing necessary for licensing and credentialing

Many locums physicians have LOTS of state licenses. You’ll want to make sure that you allot for licensing times, especially in states where there are more hurdles or nuances, or that just generally take longer.


Credentialing can also take between 60-120 days, and sometimes even more. So it’s going to be a minute before you can actually work.


If you need help with licensing, we have a resource!


Related PSG resources:

  • BlueShift Licensing offers PSG members 10% off of licensing and credentialing related services through our advertising relationship. Jennifer Lincoln and her team are experienced and have helped so many physicians and companies get their licensing completed efficiently. Mention PSG when you contact them to get our discount.

  • Guide to physician licensing



Consider trying out locums life first as a side gig and see if you like it


The grass isn’t always greener, so make sure you’re running towards something you are excited about rather than running away from your employed position. Try things like:

  • Moonlighting or per diem work

  • A few distant locums assignments to see how you do with the travel and work combination


This will also allow you to start building connections and relationships in the field, potentially finding a few hospital systems that will consistently give you work, etc. You’ll also learn which agencies you like working with, what your dealbreakers are, what to look out for in locums contracts, etc.



What do I need to do once I’ve decided I want to imminently make the switch to locums from a W2 employed position?


Checklist when making the transition to locums work, including 8 things to do first

Start looking for locums work (don’t quit your job first and assume that the locums work will be there if you can help it!)


The first thing you’re going to want to do is line up some gigs with some agencies that you trust. Hopefully you’ve already dipped your toes into this water beforehand, per the last section.


Talk to multiple agencies instead of putting all of your eggs in one basket. Not only will that give you more opportunities, but you’ll get an idea of which recruiters you like working with, which companies have the best rates or contractual terms, which ones are major players in different geographical areas, and which are the best about housing, travel, malpractice coverage, etc.


Here are some resources if you’re just starting with this process.


Related PSG resources:



Make sure your core documents are all in place for credentialing and licensing


You’ll need, at minimum:

  • An updated CV

  • Case logs if you’re a procedural specialty

  • References (start asking ahead of time to people that you can trust)

  • Licenses

  • DEA

  • Board certification documentation


Know that licensing and credentialing is a lengthy process, and allotting 6 months for this is probably a good idea. Missing paperwork can delay the process significantly, and lead to assignments being cancelled. 



Start getting licensed, strategically


While you don’t need every state license in every place you are open to working with before you start, start getting your licenses for the places you’d like to start. Ideally you align some of these with states where demand for licensing is high. The good news is that many belong to the Interstate Medical Licensure Compact (IMLC), allowing you to kill a few birds with one stone.


Related PSG resources:

  • BlueShift Licensing offers PSG members 10% off of licensing and credentialing related services through our advertising relationship. Jennifer Lincoln and her team are experienced and have helped so many physicians and companies get their licensing completed efficiently. Mention PSG when you contact them to get our discount.

  • Guide to physician licensing



Figure out your needed benefits from the ones you’ll be giving up at your employed position, and plan accordingly


You’ll likely want to set up, at minimum, health insurance, unless you have it available to you through another family member.


Related PSG resources:


You’ll also want to figure out retirement accounts, because you don’t want to give up tax advantaged accounts. Ideally, you’ll have even more options for this with your new found self employed income!


Related PSG resource:


Lastly, if you depend on your current employer for disability insurance or life insurance (though it’s not a great idea to only have insurance through your employer), you’ll need new policies.


Related PSG resource:



Get yourself set up financially with an accountant and entity structure for self employed income


You’ll likely want to create an entity for your locums contracts to flow through, both for contracting purposes and tax reasons.


If you’re not already working with an accountant that’s familiar with self employed income, this may be the time to switch. We have a database of accountants for physicians if you need it. 


Related PSG resources:



Giving notice at your job


Once you’ve figured everything out, the next big step is to give notice at your job. Do not do this without INTENTION.


It’s important to realize that you lose a lot of control once you’ve given notice. We see issues all of the time on our physician communities where things don’t go as planned once a doctor gives notice. They could be terminated immediately, they may not get their PTO requests granted, they may have a hard time getting cooperation on needed logins, procedure logs, etc. As such, we’ve compiled a list of things to do before giving notice that you’re leaving your job as a doctor based on the experiences of community members. The article has a lot more details, but at minimum, look at these: 




Conclusion


Making the transition from being an employed physician to a locums physician is a BIG deal. It will disrupt or change many aspects of your life, and you want to make sure you set yourself up for success. While things will always come up that you couldn’t have planned for, we hope this guide gives you an idea of the things to do as you make the transition, to avoid as many hiccups as possible.



Additional locums resources for physicians


Sign up for our weekly PSG newsletter for alerts on new educational content, free webinars, and more. 


We also have a free locums matching database for those physicians interested in locums positions (open to members only).


Locums related vendors:

  • BlueShift Licensing offers PSG members 10% off of licensing and credentialing related services through our advertising relationship. Jennifer Lincoln and her team are experienced and have helped so many physicians and companies get their licensing completed efficiently. Mention PSG when you contact them to get our discount.

  • Accountants for Physicians

  • Financial Advisors for Physicians



Explore related PSG content:

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