SURVEY OF TEMPORARY PHYSICIAN STAFF CARE Statesman Drive, Irving, Texas (800)

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1 We ve earned The Joint Commission s Gold Seal of Approval SURVEY OF TEMPORARY PHYSICIAN STAFFING TRENDS BASED UPON DATA STAFF CARE 5001 Statesman Drive, Irving, Texas (800)

2 SURVEY OF TEMPORARY PHYSICIAN STAFFING TRENDS BASED UPON DATA IN THIS REPORT OVERVIEW/METHODOLOGY PART ONE KEY FINDINGS QUESTIONS AND ANSWERS ANALYSIS PART TWO KEY FINDINGS QUESTIONS AND ANSWERS TRENDS AND OBSERVATIONS PART THREE REVIEW OF ASSIGNMENTS TRENDS AND OBSERVATIONS PAGE 3 PAGES 4-5 PAGES 6-11 PAGES PAGES PAGES PAGES PAGES PAGES OVERVIEW Staff Care is a national healthcare staffing firm specializing in matching temporary (i.e., locum tenens) physicians, dentists, certified registered nurse anesthetists (CRNAs) and various allied healthcare professionals with hospitals, medical groups, government facilities and other healthcare organizations. Established in 1992, Staff Care is a company of AMN Healthcare, the innovator in healthcare workforce solutions, and is certified by the Joint Commission. Additionally, Staff Care offers an in-house CVO that is certified by the NCQA. This report marks Staff Care s ninth Survey of Temporary Physician Staffing Trends. The purpose of the survey is to track trends in the locum tenens physician staffing market and to provide benchmark data that may be useful to physicians, healthcare executives, academics, journalists and others who monitor developments in the healthcare staffing industry. METHODOLOGY Staff Care s Survey of Temporary Physician Staffing Trends is based on surveys sent by to healthcare executives and locum tenens physicians nationwide. The survey also includes an examination of the temporary physician staffing assignments Staff Care conducted in calendar year. Data from past Staff Care surveys are included where applicable. Part I of the survey examines why healthcare facilities, including acute care hospitals, medical groups and state-supported facilities such as behavioral health centers, use locum tenens physicians and how they evaluate the quality and services provided by locum tenens practitioners. Part II of the survey examines why physicians choose to work on a locum tenens basis, how they select temporary practice opportunities, how they are perceived by colleagues and related matters. Part III of the survey indicates the type of locum tenens staffing assignments Staff Care conducted in calendar year. The breakdown of temporary practitioner days requested by specialty is offered as an indicator of current physician, CRNA and dentist supply and demand trends in locum tenens. Part III also includes the number of temporary physician days Staff Care filled in. For additional information about this survey contact: Phil Miller (469) info@staffcare.com 5001 Statesman Drive Irving, Texas Proud Sponsor, Country Doctor of the Year Award Member of the National Association of Locum Tenens Organizations Copyright Staff Care, Inc Published May 2012 Parts I and II of the survey were conducted over the five month period from October, to February 2012, and the final survey report was released in April, Respondents were self-selected and included Staff Care clients and non-clients, as well as physicians who have been matched to temporary assignments by Staff Care and those who have not. 3

3 PART ONE KEY FINDINGS OF PART I INCLUDE Locum tenens physicians remain a commonly used resource for most healthcare facility administrators. For the fifth year in a row, at least 75% of healthcare facility administrators indicated they had used locum tenens physicians to supplement their existing staffs sometime in the previous 12 months. While locum tenens physicians may have been an anomaly at many hospitals and medical groups in the past, survey results indicate they are a standard component of most medical staffs today. About 4 of healthcare facilities are looking for locum tenens physicians at any one time. For the eighth consecutive year, at least 4 of healthcare administrators indicated they currently are looking for locum tenens physicians to supplement their current staffs. The majority of healthcare facilities use at least one locum tenens physician per month. Fifty-percent of administrators indicated they typically use one to three locum tenens physicians per month, said they use four to six, and use seven or more. The remaining 3 said that in a typical month they do not use locum tenens physicians, a number that has remained consistent over the last five years. SURVEY OF LOCUM TENENS PHYSICIAN USERS, INCLUDING HOSPITAL, MEDICAL GROUP AND GOVERNMENT HEALTH FACILITY MANAGERS Number of Surveys Completed =106 KEY FINDINGS Physicians have substituted for colleagues who are absent from their practices for many generations. Therefore, locum tenens is a time-honored practice in the medical community. However, it is only in the last several decades that the use of locum tenens doctors has become widespread at hospitals, medical groups and other healthcare facilities. In the 1970s, government grants were allotted to make temporary physicians available in medically underserved rural areas, accelerating the use of locum tenens doctors. Locum tenens companies began as niche players in the health care staffing industry, filling physician days on a limited basis in mostly rural areas. Today, by contrast, locum tenens staffing is a multi-billion dollar industry and temporary physicians are used by healthcare facilities in a wide range of settings and locations nationwide. The foremost use of locum tenens physicians is to fill in while permanent staff is sought. Fifty-seven percent of administrators indicated they use temporary physicians to maintain services while they seek to fill open permanent positions, followed by 4 who use locum tenens doctors to fill in for vacationing physicians or those pursuing continuing medical education (CME). The majority of healthcare facility administrators rate locum tenens physicians as good to excellent. Fiftyseven percent of those surveyed indicated that the general skill level of locum tenens physicians is either good or excellent. Forty-two percent rated their skill level as adequate, while only one percent rated the skill level of locum tenens physicians as unsatisfactory. Continued patient care and revenue are the main benefits of locum tenens physicians. Sixty-four percent of administrators indicated that the continual treatment of patients is the main benefit to using locum tenens physicians, followed by 43% who said locum tenens physicians prevent revenue loss. The main drawback to using locum tenens physicians cited by 8 of administrators is cost. Seventy-nine percent of administrators believe locum tenens physicians are worth the cost. Though cost is considered one of the drawbacks of using locum tenens physicians by many administrators, over three-quarters said that locum tenens physicians are worth the cost, while only 2 said they are not worth the cost. 4 Part I of Staff Care s Survey of Temporary Physician Staffing Trends examines the use of locum tenens physicians in hospitals, medical groups and other settings. It seeks to determine how prevalent the use of locum tenens physicians is and why healthcare facilities use temporary doctors. The survey also examines how healthcare facility administrators evaluate the quality of care provided by locum tenens physicians and whether or not their services are worth the cost. Locum tenens physicians are generally accepted in the work place. Sixty-three percent or more of those surveyed indicated locum tenens physicians are accepted by patients, colleagues and facility administrators. Responses to Part 1 of the survey follow. 5

4 QUESTIONS ASKED AND RESPONSES RECEIVED 1. Have you used temporary (locum tenens) physicians to supplement your existing staff any time during the last 12 months? Yes No Yes No 75% 25% % % 60% 7 23% Are you currently looking for locum tenens physicians to supplement your existing staff? 53% 4 5. Why do you or would you typically use a locum tenens physician? (check all that apply) Fill in until a permanent doctor is found Fill in for staff who have left Vacation/continuing medical education Meet rising patient demand Fill in during peak usage times Test market a new service % 55% 3 53% How difficult is it to find locum tenens coverage today compared to 12 months ago? 6. What are the benefits/drawbacks of using locum tenens physicians? (check all that apply) BENEFITS Allows continual treatment of patients 6 73% 3 80% 70% More difficult Less difficult The same % 5 23% % Prevent revenue loss Prevents existing staff burnout Immediate availability 43% 25% % % 3 5 Cost 35% Other 4. In a typical month, how many locum tenens physicians do you use? DRAWBACKS Cost None % 55% 3 53% 3 5 Familiarity with department/practice Learning equipment/procedures Pay * Other 60% 35% 3 6 4?% 3 50% or more * This question asked for the first time in the current survey 6 7

5 Today, national doctor shortages have prompted hospitals, medical groups and others to use temporary doctors to maintain services in lieu of permanent doctors, who may be difficult to find. 7. What is your perception of the general skill level of locum tenens physicians? 8. At your facility, how are locum tenens providers viewed by: COLLEAGUES Accepted Not accepted Tolerated Unsure 63% 3% 2 10% % 7 > 1 1 ADMINISTRATION Accepted Not accepted Tolerated Unsure % 1 6 3% 10% 7 > Excellent Good Adequate Unsatisfactory PATIENTS Accepted % 65% Not accepted 0% 0% Tolerated 1 1 Unsure Please rate locum tenens physicians compared to your permanent medical staff in the following areas: Excellent Good Adequate Unsatisfactory PATIENTS TREATED PER DAY More Fewer 55% 53% 40% 35% 3 same % 6 Excellent Good Adequate Unsatisfactory 10. Please rate locum tenens physicians compared to your permanent medical staff in the following areas: GROSS CHARGES GENERATED PER DAY More 5% 5% Fewer % Excellent Good Adequate Unsatisfactory 8 9 same 43% 53% 6 6

6 11. When conducting your search for locum tenens physicians, how many search firms/staffing agencies do you generally work with? 13. How would you rate the value of locum tenens physicians to your facility? 7 2 Worth the Cost Not Worth the Cost What is your ideal locum tenens assignment length? None Two to Three One Four or More Less than one month % 1-4 months 3 33% % 5-8 months 10% 10% months 12. What are the most important factors in selecting a temporary staffing firm? (check all that apply) 15. How far are you willing to travel for a locum tenens assignment? Availability of candidates/promptness Quality of physicians provided Customer service Cost Contract flexibility Malpractice insurance % % % 6 50% 4 35% 2 70% Home region only Home state only Specific regions only Nationwide * 25% 45% Other 5% 3% * This question asked for the first time in the current survey 10 11

7 ANALYSIS Part I of Staff Care s Survey of Temporary Physician Staffing Trends provides insight into how often healthcare organizations use temporary (locum tenens) physicians, why they use these physicians, the benefits locum tenens physicians provide and the perceived skill levels of locum tenens physicians. WHO IS USING LOCUM TENENS PHYSICIANS? The 2012 survey suggests that the use of locum tenens physicians continues to be common among hospitals, medical groups, and government supported healthcare facilities. Seventy-five percent of health facility managers surveyed indicated that their facilities had used locum tenens physicians to supplement their existing medical staffs sometime during the last 12 months, down from 85% in, but similar to responses cited in the,, and survey findings. In each of the last five temporary physician staffing surveys conducted by Staff Care, at least 7 of respondents have indicated that their facilities used locum tenens physicians sometime in the previous 12 months, suggesting that the use of locum tenens physicians has become a standard practice at the majority of healthcare facilities offering physician services. The majority of those surveyed (6) responded that finding locum tenens physicians is no more or less difficult today than it was 12 months ago. However, 2 said that finding locum tenens physicians is easier today than it was 12 months ago, compared to only who indicated finding locum tenens physicians is harder today than it was 12 months ago. Some facilities may find locum tenens physicians easier to staff because locum tenens candidates have become more abundant in their geographic areas. Due to the recession and other factors referenced in Part II of this survey, a growing number of physicians are electing to work locum tenens and a growing number of firms have entered the temporary physician staffing field. REASONS FOR USING LOCUM TENENS Healthcare organizations use locum tenens physicians for a variety of reasons. The most common reason for using locum tenens referenced in the 2012 survey, cited by 5 of respondents, is to maintain services until a permanent doctor is found. This response reflects an evolution in the locum tenens market that is linked to the national physician shortage. Historically, locum tenens doctors have been used to hold a place for ill, vacationing or otherwise absent doctors pending their return. Today, national doctor shortages have prompted hospitals, medical groups and others to use temporary doctors to maintain services in lieu of permanent doctors, who may be difficult to find. The survey further suggests that about 4 of healthcare facilities are seeking locum tenens physicians at any given time. Forty-one percent of facility administrators responding to the 2012 survey indicated that their facilities currently are seeking locum tenens physicians to supplement their existing medical staffs, the same number as and virtually the same number as in. The number of facilities actively seeking locum tenens physicians declined in, and relative to and, when over 50% of those responding said they were currently seeking locum tenens physicians. Staff Care attributes this decline to the recession, which caused decreases in hospital and physician utilization. This, in turn, may have caused physicians to reduce their vacation times, increase their hours and take other steps that could inhibit the need for locum tenens physicians. Since ; however, the number of healthcare facilities indicating they are actively seeking locum tenens physicians has held steady, suggesting some stability has returned to the temporary physician staffing market. The survey indicates that the majority of facilities use locum tenens physicians on a monthly basis. Fiftypercent of administrators indicated that in a typical month they use at least one to three locum tenens physicians, said they use from four to six locum tenens physicians, and said they use seven or more locum tenens physicians in a typical month. Over one-third of those surveyed (3) indicated that in a typical month they do not use any locum tenens physicians. For some facilities, locum tenens is either not part of their staffing strategy, or it remains only an occasional option. In addition, the aging of the physician population (3 of physicians today are 55 years old or older, (Source: AMN Physician Master File ) and the increased mobility of doctors can generate relatively high physician turnover rates at hospitals, medical groups and other facilities. According to the 2012 survey, 4 of health care facilities use locum tenens doctors to fill in for physicians who have left the area, compared to 2 in. Seventeen percent said they use locum tenens doctors to either help meet rising patient demand for medical services or to fill in during peak usage times such as flu season. Many physicians today are interested in a controllable lifestyle and seek vacation time and other time off when evaluating employment opportunities. This has led to a significant reduction in the overall physician workforce as measured by full time equivalents (FTEs) as physicians work fewer hours than they have in the past (see chart below) HOURS WORKED PER WEEK BY PHYSICIANS Equals 36,000 fewer physician FTEs Source: Journal of the American Medical Association as cited in HealthLeaders, February 25, Changes in physician practice style have contributed to the increased use of locum tenens doctors. Though filling in for vacationing or otherwise absent physicians no longer is the primary reason facilities use locum tenens physicians, it is still a leading reason they do so. Forty-six percent of those surveyed indicated they use locum tenens physicians to fill in for doctors who are out on vacation, illness or for other reasons. The main benefit of using locum tenens physicians, cited by 6 of those surveyed, is to maintain continuity of patient care. However, by seeing patients who might otherwise have gone elsewhere, locum tenens physicians also allow medical facilities to maintain revenue streams

8 The opportunity cost of not having a physician in place can be considerable. According to a study by physician search firm Merritt Hawkins, an AMN Healthcare company, physicians on average generate $1.5 million a year on behalf of their affiliated hospitals. The chart below indicates how this breaks out on a pro rated monthly basis for several medical specialties: PHYSICIAN GENERATED REVENUE PRO RATED OVER ONE MONTH $138,569 Family Practice $107,509 Psychiatry $139,862 Internal Medicine $176,480 Orthopedic Surgery Forty-three percent of those surveyed said that preventing revenue loss was a benefit of using locum tenens physicians, while 2 identified the immediate availability of locum tenens physicians as a benefit. Using locum tenens physicians also can be part of a physician retention strategy, helping to prevent the burn-out of existing staff, as cited by 25% of administrators surveyed. HOW ARE LOCUM TENENS PHYSICIANS PERCEIVED? $176,041 General Surgery Source: Merritt Hawkins Survey of Physician Inpatient/ Outpatient Revenue Healthcare facility managers were asked to rate the general skill level of locum tenens physicians. The majority (5) rated locum tenens physicians skills as either good or excellent, down from 7 in, and down from 6 in and 7 in. One reason for this decline may be the proliferation of both locum tenens physicians and locum tenens staffing firms that place physician candidates, leading to less uniform standards. The 2012 survey suggests that users of locum tenens physicians ensure the staffing firms they work with have robust quality and credentialing programs in place. were not accepted and were unsure. Sixty-four percent said locum tenens physicians are accepted by patients, 1 said they are tolerated, one percent said they were not accepted, and said they were unsure. In comparing locum tenens physicians to permanent physicians on their staffs, 45% of healthcare facility managers said that locum tenens physicians treat the same or a greater number of patients per day than do permanent physicians, while 55% said they see fewer patients per day than permanent physicians. Fortythree percent of those surveyed said locum tenens physicians generate the same or greater gross charges per day as do permanent physicians, while the remaining 5 indicated locum tenens physicians generate fewer gross charges per day than permanent physicians. Locum tenens physicians may generate more charges though they see fewer patients than permanent physicians by handling generally more complex or urgent cases. Some patients may choose to delay a physician appointment for a minor problem until the permanent physician returns, but will see a locum tenens physician if their problems are acute and require immediate attention. In addition, many facilities are unsure of how to bill for the services of locum tenens clients or of the down-stream revenue they generate, which could allow facilities to realize revenue from locum tenens physicians that more closely approximate the charges billed by their permanent staff. In 2012, Staff Care introduced a new service to assist facilities in this process, which could allow the locum tenens clients to more closely approximate the charges billed by their permanent staff. WORTH THE COST? Healthcare facilities pay a daily rate for the services of locum tenens physicians, a rate that can range from several hundred dollars to over $1,500, depending on the specialty. Measured against this are the various benefits locum tenens doctors provide, including the ability to maintain both medical services and revenue. On balance, the great majority of healthcare facility managers surveyed in indicated that locum tenens physicians are worth the cost. Seventy-nine percent of those surveyed said locum tenens physicians are worth the cost, down from 8 in but the same percent as in (Cited in the 2012 Survey). However, it should be noted that only of administrators rated the skill level of locum tenens physicians as unsatisfactory, while 4 rated their skill level as adequate. When locum tenens physicians first came into wide use, the quality of these physicians sometimes was questioned. Today, locum tenens practice has become more widely accepted by health care facilities, and physicians practicing locum tenens are rigorously screened. The 2012 survey suggests that the quality of locum tenens physicians is generally considered to be high or at least satisfactory. Healthcare facility managers also were asked to indicate how locum tenens physicians are viewed by various parties, including permanent physicians on their staffs, administrators, and patients. The majority (63%) said that locum tenens physicians are accepted by permanent staff physicians, 2 said they are tolerated, 3% said they were not accepted and the remaining 10% were unsure. The majority (6) said that locum tenens physicians are accepted by the administration, 2 said they are tolerated, said they 14 15

9 PART TWO KEY FINDINGS OF PART II INCLUDE SURVEY OF PHYSICIANS WORKING ON A LOCUM TENENS BASIS Number of Providers Surveyed = 205 KEY FINDINGS Today s healthcare system is undergoing profound changes, including changes in the way that physicians practice. The full-time, independent practice model in which physicians own their own shops is giving way to a variety of different practice styles, including hospital employment, part-time practice, inpatient practice, concierge medicine and locum tenens. Why do physicians choose to practice on a temporary basis? What are some of the characteristics of locum tenens physicians and to what extent do these physicians feel they are accepted by colleagues and patients? Part II of Staff Care s Survey of Temporary Physician Staffing Trends, completed by physicians who work on a locum tenens basis, examines these and related questions. Most locum tenens physicians find temporary work as satisfying or more satisfying than permanent work. Eighty-one percent of physicians surveyed said they find working locum tenens to be as satisfying or more satisfying than traditional, permanent practice. Flexibility and freedom are the main draws. Physicians cited freedom and flexibility as the main benefits of working locum tenens, ahead of pay rate, travel and other factors. The majority of locum tenens physicians are accepted by colleagues, administrators and patients. Virtually all physicians surveyed said they are accepted or tolerated by these groups, including 9 who said they are accepted by patients. The majority of locum tenens physicians work six or fewer temporary assignments a year. Eighty percent of locum tenens physicians work six or fewer temporary assignments a year. Fifty-eight percent work three or fewer such assignments per year. Physicians tend to work through more than one staffing company. About two-thirds of physicians surveyed said they work locum tenens through two or more staffing companies. Less than three percent work on their own. Location trumps pay rate. In selecting a particular assignment, physicians look to location more than any other factor, followed by length of the assignment and pay rate. A regional focus. The majority of physicians surveyed (55%) said they are only willing to travel regionally to a locum tenens assignment. The remaining 45%, however, said they would travel nationwide. Longer is better. More physicians surveyed (5) indicated their ideal locum tenens assignment length is at least one month or more. Forty-four percent prefer shorter assignments of one month or less. An analysis of these and other findings of Part II follows. Location trumps pay rate. In selecting a particular assignment, physicians look to location more than any other factor, followed by length of the assignment and pay rate

10 QUESTIONS ASKED AND RESPONSES RECEIVED 1. About how many locum tenens assignments do you work during a year? % 53% 2 60% % 4. What are the benefits/drawbacks of working as a locum tenens? (check all that apply) 7 or more Have you ever worked in a permanent position? BENEFITS Freedom/ flexibility No politics 83% 50% % 85% 4 Travel Pay rate Professional development Yes 9 Yes 90% Yes 9 A way to find perm 1 No No 10% 3. If yes, how would you rate working as a locum tenens versus working in a permanent position? Locum tenens is MORE satisfying Locum tenens is LESS satisfying Both types are EQUALLY satisfying % No DRAWBACKS Away from home Uncertainty of assignment Lack of benefits Quality of assignment Pay * Other % % 3 25% % 1 63% % *A new category for current survey 5. With how many locum tenens agencies do you work? None 3% 1 LT is more satisfying % 3 3 LT is Less satisfying % LT is equally satisfying or more

11 8. When looking for locum tenens opportunities, what are your most important resources? (check all that apply) Print journals Most Important Somewhat Important 1 Least Important 7 alerts 50% 3 Locum tenens agency 2 40% 3 Web sites 23% 6 Text alerts 73% Mobile applications Internet job boards % 6. How do you select a firm? (check all that apply) Word of mouth 40% 3 2 Location of opportunities Customer service % 60% % 5 Print journals Text alerts Most Important Somewhat Important 2 2 Least Important 6 70% Pay rate Reputation/name recognition % Internet job boards Word of mouth 30% Number of opportunities Malpractice insurance Other 2 0% 2 0% 10% What value do you bring to a hiring facility?* (check all that apply) 7. How do you select temporary opportunities? (check all that apply) Location Pay Length of opportunity Type/size of facility Quality of equipment Patient load Available shifts % % % 2 23% % 2 n/a Maintain patient care Prevent staff burn-out Generate revenue Add a specific skill % * This question asked for the first time in current survey Medical politics is less of a factor in locum tenens, as physicians working temporary assignments are removed from the turf battles or other sources of conflict that may arise at any particular site.

12 10. As a locum tenens provider, how are you viewed by: TRENDS AND OBSERVATIONS Accepted Tolerated Not Accepted Staff Physicians Administration Patients Part II of Staff Care s Survey of Temporary Physician Staffing Trends offers insights into what attracts physicians to locum tenens practice, their assignment preferences and how they are viewed by peers, administrators and patients % WHY PRACTICE LOCUMS? Medical practice today is a highly regulated and scrutinized activity. Many physicians feel constrained by government regulations and third-party payers that dictate both the rate at which they are reimbursed and how they practice. As a result, more doctors are seeking alternatives to traditional practice settings. Staff Physicians Administration Patients In a survey, The Physicians Foundation, a non-profit grant-making organization composed of state and local medical societies, asked physicians what they plan to do in the next one to three years. Only 2 of the 2,400 doctors responding to the survey indicated they will continue to practice the way they are. The remaining seventy-four percent said they plan to make a change (see chart below) % Consider your practice plans over the next three years. Do you plan to: (check all that apply). Continue practicing as I am 2 Cut back on hours Staff Physicians Administration Patients Retire Switch to a cash or concierge practice Work locum tenens 1 3% Relocate to another practice/community Cut back on patients seen 1 Seek a non-clinical job within healthcare 1 Seek a job/business unrelated to healthcare 1 Staff Physicians Administration Patients Work part-time (20 hours a week or less) % Close my practice to new patients Other Source: The Physicians Foundation Survey - Physicians and Health Reform

13 In addition to pursuing options such as retirement, concierge practice, or hospital employment, of physicians said they plan to work locum tenens. Staff Care s Survey of Temporary Physician Staffing Trends suggests why more doctors are attracted to temporary practice. The primary benefits indentified by 83% of those surveyed were freedom and flexibility. Unlike traditional practice in which physicians must handle both their clinical duties and assume the responsibilities of managing a business, locum tenens features a minimum of reimbursement or administrative-related paperwork and other so-called hassle factors. Locum tenens physicians are paid a daily rate by the staffing companies with which they work and do not have to bill myriad third party payers and then fight to ensure that bills are paid. They also can spend time with patients as they see fit, because they re not tied to production formulas that require them to see many patients or hit stipulated work targets through relative value units (RVUs) or other metrics; and as they are not employers, locum tenens physicians do not have to be concerned about the many employment-related regulations governing the workplace, as do private practice doctors. In addition, traditional medical practice is fraught with politics, as physicians must work within an often turbulent system featuring multiple stakeholders with conflicting priorities, including fellow physicians, hospital or group administrators, board members, and others. Medical politics is less of a factor in locum tenens, as physicians working temporary assignments are removed from the turf battles or other sources of conflict that may arise at any particular site. Fifty-percent of physicians surveyed said that lack of medical politics is a benefit of working locum tenens, the second highest rated benefit next to freedom and flexibility. Locum tenens work allows physicians to experience a wide range of practice environments with varying standards of care. It offers a positive forum for acquiring professional skills and can be a medical education for many doctors, a fact reflected in the survey. Twenty-two percent of physicians cited professional development as one of the benefits of working locum tenens. An additional attraction of locum tenens, cited by 1 of physicians, is that it offers a way to test drive different practice opportunities in an effort to find a permanent position. Working locum tenens assignments for weeks at a time or more, allows physicians to get a true sense of what a practice is like. It also allows hospital or medical group personnel to see how well they mesh with the physician. At the end of the assignment it is not unusual for both parties to see that it is a good match and for the physician to be placed on a permanent basis. A problematic medical practice environment is one reason more physicians are opting to work locum tenens. An aging physician workforce is another. According to the American Medical Association, 3 of practicing physicians today are 56 or older. Older physicians often use locum tenens as a way to slow down or semi-retire while continuing to see patients and earn income. Though locum tenens physicians include doctors in all age ranges, experienced doctors make up the majority of those working temporary assignments. There are, of course, drawbacks to working locum tenens as well as benefits. Being away from family and friends was the most frequently cited drawback to locum tenens practice, referenced by 6 of those surveyed, followed by uncertainty of assignments, cited by 5. Uncertainty can be a factor for those physicians unable to schedule assignments as continuously as they would prefer. Lack of benefits was a drawback cited by 5 of those surveyed. This response reflects the fact that locum tenens physicians are independent contractors and are not employed by temporary staffing agencies such as Staff Care. They may get certain benefits through their permanent employers as they moonlight on temporary assignments or they may arrange for their own health insurance and other benefits. In addition, thirty-two percent of physicians cited pay as a drawback while 2 cited quality of assignments. Both these practice-related considerations were rated higher than the obvious benefit many physicians and others may think of when locum tenens comes to mind, i.e., travel. Travel was rated as a benefit by 4 of doctors surveyed, suggesting that physicians do not choose locum tenens primarily as a form of tourism. Style of practice is the main draw of locum tenens, though travel is one of its attractions. Practice style also trumps pay for the majority of locum tenens physicians surveyed. Thirty-six percent of physicians identified pay as a benefit of working locum tenens, the fourth highest rated benefit cited. Locum tenens doctors may earn anywhere from a few hundred dollars a day to over one thousand dollars a day, depending on their specialty and hours worked. Full-time locum tenens physicians willing to put in some overtime hours can earn approximately what a permanent physician earns. For many locum tenens physicians, however, money is secondary to a favorable work environment. Despite these drawbacks, the number of physicians working locum tenens continues to grow. There is no objective source Staff Care is aware of that tracks how many physicians work on a locum tenens basis each year. Staff Care estimates this number based on our knowledge of the temporary staffing industry, including the number of physicians who work through us and an approximation of the number who work through other firms or on their own. This number has grown from 26,000 ten years ago to approximately 38,000 or more today, as the chart below indicates. ESTIMATED NUMBER OF PHYSICIANS WORKING LOCUM TENENS Source: Staff Care industry estimates ,000 34,000 38,

14 ASSIGNMENT SELECTION AND PREFERENCES Most physicians working locum tenens do so through temporary staffing companies. Ninety-seven percent of physicians said they work with at least one staffing company, while only three percent said they work on their own. Though they do not employ physicians, temporary physician staffing companies help match them with opportunities and arrange for many of the logistics involved, such as travel, accommodation and malpractice insurance. They also work as a liaison for the physician while on assignment, assisting in the case of any concerns over communication with the facility, housing issues, or other challenges. The majority of those surveyed (6) choose to work through two or more firms, expanding the possible range of assignments and locations from which they can choose. Because they are independent contractors, locum tenens physicians are not obligated to work any particular assignment but can select those which best match their interests or schedules. The first factor physicians consider when selecting a staffing company is the location of opportunities the company offers, followed by good service. Locum tenens physicians typically seek practices within their regions or in locations in which they have a particular interest. After that, they are looking for companies which can provide them with enough support to make the process of licensing, credentialing, travel, and accommodation as seamless as possible. The survey indicates that number of opportunities offered by the company, pay rates and the company s reputation also are important considerations. When asked how they select a temporary opportunity, location was cited as the number one selling point. Eighty-nine percent of physicians surveyed identified location as a factor, followed by 7 who identified length of assignment and 6 who identified pay rate. Thirty-three percent identified available shifts as a factor, while 2 cited patient load. and 5 cited internet job boards as important. Newer communications channels, such as text alerts and mobile applications, were less frequently cited, although this may change as these channels gain in popularity. The majority of physicians surveyed (5) work one to three locum tenens assignments per year, while 2 work four to six assignments. The remaining work seven or more assignments annually. Physicians working a limited number of assignments often are in permanent practice and moonlight on temporary assignments during vacation times or other opportunities. Other physicians may work temporary assignments on multiple occasions or even throughout the year. Some doctors, while working only two or three temporary assignments a year, may work on longer assignments that, combined, can take up a significant portion of the calendar year. Forty-four percent of physicians surveyed said their ideal temporary assignment length is less than one month, which reflects the fact that many locum tenens physicians have limited windows during which they can work temporary assignments. Thirty-four percent indicated their ideal assignment length was one to four months, while 10% preferred assignment lengths of five months or longer, demonstrating that some locum tenens doctors work temporary assignments on virtually a full-time basis. Locum tenens doctors surveyed rated the various methods by which they seek or obtain information about locum tenens practice opportunities. alerts, in which assignment information is sent directly to doctors, was rated an important source by 8 of physicians. These alerts allow the job to come to the locum tenens physician, rather than the physician having to seek out the job. Sixty-eight percent of physicians cited locum tenens web sites as an important source, 60% cited word-of-mouth as important, A FEELING OF ACCEPTANCE Locum tenens physicians were asked to what degree they are accepted by other physicians, administrators and patients while on temporary assignments. Locum tenens physicians have been a growing part of the medical landscape for some 30 years and the survey indicates they feel generally accepted. The great majority of locum tenens physicians interviewed (8) indicated they are accepted by permanent physicians with whom they work, while 9 said they are accepted by patients, and 7 said they were accepted by administrators. PERMANENT VS. LOCUM TENENS Ninety-four percent of physicians surveyed said they had worked both on a locum tenens basis and in permanent practice. These physicians were asked to compare the two practice styles. The majority (8) said they found locum tenens work to be as satisfying or more satisfying than permanent practice, while said they found permanent practice to be more satisfying than locum tenens work. Many doctors enjoy the relatively hassle-free practice style that locum tenens work affords and find it comparably or even more rewarding than permanent practice. Some doctors, however, may prefer the enduring patient relationships that were once typical of permanent practice and may find locum tenens work to be less rewarding in this regard

15 PART THREE TOP TEMPORARY STAFFING ASSIGNMENTS BY DAYS REQUESTED Staff Care tracks demand for temporary physician staffing services through the number of temporary physician and dentist days requested by its clients. The table below indicates the percentage of Staff Care s days requested in by medical specialty Primary Care (FP, IM & Ped only) * Behavioral Health Miscellaneous / IM subspecialties Anesthesia (Anesthesiologists/ CRNAs) Surgery Hospitalist ** 10% Radiology 5% 1 Emergency Medicine Dentistry 3% Oncology *** * Prior to, this category included hospitalists and some internal medicine sub-specialists ** Prior to, this category was included in the primary care category *** Prior to, this category was included in the radiology category. REVIEW OF STAFF CARE S TEMPORARY PHYSICIAN STAFFING ASSIGNMENTS In the course of a calendar year, Staff Care conducts thousands of temporary physician search assignments for its clients, seeking to match independent contractor physicians in multiple specialties with hospitals, medical groups, government facilities and other organizations requiring the services of locum tenens physicians. Staff Care also conducts temporary staffing assignments for certified registered nurse anesthetists (CRNAs) for dentists and for allied health professionals. Following is a review of the temporary staffing assignments Staff Care conducted in calendar year. The review reflects current trends in the locum tenens staffing industry, including which types of temporary healthcare providers are in the greatest demand. NUMBER OF DAYS FILLED 20011,,, 2008, , , ,578 TRENDS AND OBSERVATIONS , ,576 The breakdown of temporary provider days requested above reflects current demand trends in locum tenens. Days requested indicates the number of temporary clinician days in various specialties Staff Care was asked to fill by hospitals, medical groups and other healthcare facilities nationwide. Primary care (family practice, general internal medicine, and pediatrics) was the specialty area in greatest demand in, accounting for of total days requested.

16 The rise in demand for locum tenens primary care physicians is symptomatic of a national shortage of these types of doctors. The shortage is a function of changing demographics, including both significant population growth and population aging, coupled with a stagnant to declining supply of primary care physicians. The Census Bureau projects that 50 million people will be added to the population between 2000 and This includes new births and millions of immigrants, many of whom are young and will require the services of family physicians and pediatricians. The supply of family physicians is compromised by the fact that income and practice conditions for these physicians still trails that of medical specialists. In addition, 75 million baby boomers will begin turning 65 and be eligible for Medicare starting in. According to the Department of Health and Human Services, patients 65 or over visit a physician at three times the rate of younger people. Older patients with multiple chronic conditions typically are treated by general internists. The supply of internists, however, is compromised by the fact that a growing number of internists are choosing to sub-specialize and are not entering primary care practice. Geographic distribution of physicians in primary care is an additional concern. The Department of Health and Human Services lists over 6,200 Health Professional Shortage Areas (HPSAs) for primary care, in which 65 million Americans live. These areas are typically located in traditionally underserved rural and inner city communities. These trends are likely to be further compounded by healthcare reform, which will add some 32 million patients to the ranks of the insured by Many of the newly insured will be patients with a reservoir of chronic health problems who have not been able to obtain coverage in the past. These patients are anticipated to require a relatively greater amount of physician time, further straining the supply of primary care doctors. As a result, many hospitals and medical groups will continue to be unable to fill permanent positions for primary care doctors. Often, they use locum tenens physicians to maintain services and revenue until permanent positions can be filled, as is reflected in Part I of this Survey. Behavioral Health is another area in which demand for providers exceeds supply. Behavioral Health accounted for of total clinician days requested in, second only to primary care. Demand for locum tenens behavioral health clinicians is a reflection of a growing shortage of mental health professionals nationally and of the increased demand for behavioral health services. The Department of Health and Human Services lists 3,291 HPSAs nationwide for mental health in which 80 million Americans live, up from just over 1,000 several years ago. HHS projects demand for general psychiatrists will increase between 1995 and 2020, while demand for child and adolescent psychiatry will increase by 100% during the same period. Meanwhile, the number of psychiatrists being trained is projected to remain static at best. In many cases, behavioral health facilities, particularly state funded institutions and correctional facilities, already cannot find psychiatrists to fill permanent positions and are dependent on locum tenens providers to maintain services. surgeons are in great demand and short supply. The lack of general surgeons and other types of surgeons in certain geographic areas has kept demand for locum tenens surgeons at a steady level over the last several years, including. Emergency medicine is another area of growing need. The number of patients visiting hospital emergency rooms has increased in recent years, from 90.3 million in 1996 to 119 million in 2006, according to the Centers for Disease Control. Patient wait times in the ER also have increased, up by 31 minutes from 2002 to. Many patients presenting to the ER department today are insured, but seek the ER because they cannot see an office-based physician in a timely manner. This has put growing stress on emergency department staffs, and hospitals are turning to locum tenens physicians to help fill gaps and maintain services. Six percent of Staff Care s days requested were in emergency medicine in, up from four percent the previous year. By contrast, the ongoing economic downturn has reduced utilization of healthcare services in some areas of the country, leading to fewer hospital admissions, fewer patient visits per physician and fewer procedures. As a result, physician days requested in anesthesia declined significantly in relative to previous years, though demand in this area remained stable in. A similar trend has been evident in radiology and oncology, which, in addition to the economic downturn, have been affected by changes in reimbursement that have constrained utilization in some areas. Locum tenens has been an established tradition in medicine for many years but is still a relatively new concept in dentistry. As the number of dental schools and dental school graduates in the U.S. has remained fixed in recent years, the population has grown rapidly creating a shortage of dentists that is driving the use of locum tenens practitioners. Several years ago, Staff Care received virtually no requests for locum tenens dentists. Today, the firm receives thousands of such requests from state-supported and private dental practices nationwide, with dentistry accounting for close to four percent of days requested in and. DAYS FILLED The number of temporary clinician days Staff Care has filled has increased year-over-year for the great majority of the company s 20-year history. This was not the case in or, however. As referenced above, the economic recession had a dampening effect on utilization of healthcare services, reducing demand for locum tenens services in some specialty areas and limiting the ability of healthcare organizations to budget for locum tenens staffing services. However, saw a slight reversal of this trend, as days filled by Staff Care increased year-over-year. Long-term trends indicate a sustained and growing need for physician services matched by a correspondingly limited supply, suggesting that utilization of locum tenens clinicians will eventually increase. Physician shortages are not just confined to primary care and behavioral health, however. Over 20 medical specialty societies have projected shortages in specialties such as general surgery, oncology, gastroenterology, orthopedic surgery, cardiology, pediatric subspecialties and others. Within surgical fields, demand is particularly strong for general surgeons, who often are referred to as the primary care providers of surgery because their services are less specialized and often less well remunerated than services provided by other surgical specialists. Like primary care physicians, general For more information about this survey, please contact: Phil Miller (469) phil.miller@amnhealthcare.com

17 AMN Healthcare offers speakers to address industry trends, staffing, recruitment and finance. TOPICS INCLUDE: Innovative Healthcare Workforce Solutions Physician and Nurse Shortage Issues and Trends Accountable Care Organizations and Emerging Physician Practice Models The Effect of Health Reform on Clinical Staffing New Strategies for Healthcare Staffing Economic Forecasting for Clinical Staffing Allied Staffing Shortages Vendor Management International Nurse Recruitment and Retention Travel Nurses Benefit to Magnet Hospitals Recruitment Process Outsourcing Other topics upon request Our speakers have a combined six decades of healthcare staffing experience. Each speaker offers a unique perspective to educate your audience and provide new insights into the trends and future of healthcare staffing. Learn more about key trends that can help you excel in strategic staffing management through an increased awareness of the current healthcare landscape. Speakers at AMN Healthcare have diverse expertise in innovative healthcare workforce solutions, recruitment, clinical topics, finance and industry trends, and can offer you the right educational session for your event. Whether your audience wants to learn more about recruitment and retention or is interested in the best ways to find a staffing vendor management company, AMN speakers can offer the latest data and information as well as their expert advice for successful clinical staffing. For more information or to schedule a speaking engagement, please contact: Phillip Miller Vice President, Communications Merritt Hawkins and Staff Care Companies of AMN Healthcare (NYSE: AHS) Phil.miller@amnhealthcare.com P F Statesman Drive, Irving, Texas 75063