Locum Tenens 2020: A Year Like No Other

It’s difficult to believe we’re two-thirds through a year like no other most of us can remember. Many businesses — especially a number in healthcare — have taken a beating as a result of the country’s lockdown during March and April and the temporary deferment of routine and elective medical procedures. This, in turn, has resulted in staff furloughs or layoffs, office or facility closures, and revenue shortages for healthcare organizations across the country.

In fact, the American Hospital Association projects US hospitals will lose $323B by the end of 2020 as a result of COVID-19. In an April 2 article, a USA Today writer predicted that by June of this year, “an estimated 60,000 family practices will close or significantly scale back, and 800,000 of their employees will be laid off, furloughed or have their hours reduced as they see a decline in business during the coronavirus pandemic.” The article was based on a report released April 1 by HealthLandscape and American Academy of Family Physicians (AAFP).

Meanwhile, the US Department of Health and Human Services (HHS) renewed the COVID-19 Public Health Emergency for 90 days beginning July 25. The move “continues a number of regulatory changes enacted to help physicians manage the pandemic, including the rollback of telehealth restrictions that have eased access to virtual visits, and coverage for testing without a copay,” according to the AAFP . “In SIA’s ( Staffing Industry Analysts ’) June Pulse Survey, the healthcare staffing industry stood out above the rest in the midst of the Covid-19 pandemic, according to an August 11 news release. “In fact, the four healthcare segments were the only staffing segments to record positive growth: travel nursing continued to shine at 21% median growth, followed by allied (11%), locum tenens (10%), and per diem (6%).

“However, in SIA’s July Pulse Survey, all healthcare segments but travel nursing (up 14%) were negative year-over-year,” according to SIA. Despite the volatility in healthcare staffing between April and end of June, “healthcare staffing companies are optimistic about their future prospects,” the analysts reported. “Seventy-nine percent of locum tenens staffing companies in the July survey predicted an increasing trend in new orders over the next six months. Similarly, a net 63% of travel nurse staffing firms, 63% of allied staffing firms and 47% of per diem staffing firms predicted growth in new orders over the next six months.”

As of August 20, SIA forecasted a decline in global staffing revenue of between 18 and 25 percent for 2020, depending upon the length and extent of COVID-19 outbreaks throughout the remainder of the year. SIA projects a “partial recovery” in 2021.

Healthcare Still Shedding Some Jobs

As of this writing the healthcare employment picture is a mixed bag. On August 24, Becker’s Hospital Review reported “24 hospitals bringing back furloughed employees” for June, July and August–a running list that will be updated “routinely.”

On August 7, HealthcareDive.com highlighted overall healthcare employment data, noting, “Healthcare job growth slowed in July, reflecting some effects of new coronavirus hotspots in late June that forced more shutdowns and overwhelmed hospitals in Sun Belt states.”

According to the brief, “Healthcare added 126,000 jobs in July with notable gains for dentists (+45,000), hospitals (+27,000) and physicians’ offices (+26,000). That’s slower than June’s growth of 358,000 healthcare jobs, and the industry is still about 800,000 jobs short from February’s levels.

“Nursing home job losses deepened with 28,000 more in July after losing 18,000 in June. Home healthcare services saw more gains with 16,000 new jobs in July, after (adding) 18,000 in June.

“According to the US Bureau of Labor Statistics (BLS) , healthcare jobs are projected to grow 14% from 2018 to 2028, much faster than the average for all occupations. Erica Groshen, former BLS commissioner and current senior labor economics advisor at Cornell’s School of Industrial and Labor Relations, said it’s unclear what impact the pandemic will have on those predictions long term, but the structural changes it’s having on the healthcare industry are already apparent.”

One grim statistic, reported by Becker’s Hospital Review on August 26: “Nearly 1,100 US healthcare workers have likely died of COVID-19 and its complications during the pandemic, according to the latest tally from Kaiser Health News and The Guardian …Of the 177 workers whose profiles have been published, more than 62 percent were identified as black, Latino, Asian/Pacific Islander or Native American, and 30.5 percent were born outside the US, according to Kaiser Health News and The Guardian.

“Ages of the 177 workers ranged from 20 to 80, with 21 people under 40, the news outlets said. At least 57 people reportedly had inadequate personal protective equipment.”

A “Challenging,” “Peculiar” Year

Regarding COVID-19’s impact on the US locum tenens industry, “It’s been a peculiar year, to say the least,” Interim Physicians CEO Tim Hand said. “Q1 was up year-over-year. Then we started seeing provider cancellations in mid-March, especially among those with full-time jobs who were doing locums on the side.”

Echoing his sentiments, Floyd Lee Locums CEO Natasha Lee acknowledged, “Initially we had a lot of cancellations while people figured out what was happening–it was a week-by-week assessment. At the same time, we saw an influx of physicians and providers connecting with us, looking for ways to support the hardest hit communities.”

Joseph Brunson, founder and chairman, Tusk Enterprises , observed, “In nearly 20 years of staffing, 2020 has been the most challenging. Of course, we can all probably say that in virtually any industry. We have been focused on keeping our team safe, keeping our clients fully staffed, and ensuring our level of service remains elite.”

Summing it all up, Locums Choice President Josh Campbell said, “ Demand is down, and market conditions are very uncertain due to COVID and the financial impact it’s had on health systems nationwide.”

Opportunities for Locums to Shine

Of course, as COVID-19 made its presence known in the United States early this year, it also produced some unprecedented opportunities for the locum tenens–and broader healthcare staffing–industries to shine.

In an April 9 editorial SIA Senior Managing Editor Craig Johnson quoted Floyd Lee Locums CEO Lee, who shared that more than 500 physicians and advance(d) practice providers connected with her healthcare staffing firm in one 48-hour period after the firm set up its COVID response team, “saying they are ready for assignments to fight the pandemic.”

On April 15 Cross Country Healthcare announced it was “collaborating with JetBlue to support our healthcare providers in the fight against COVID-19. As part of the collaboration, JetBlue will fly healthcare providers working with any Cross Country Healthcare brand to New York for free to fill medical assignments throughout the state.”

Two days later Jackson Healthcare President Shane Jackson told SIA his companies were mobilizing to support their home State of Georgia with critical care providers and other clinical professionals from across the country.

That same day WALB-TV News 10 reported that Jackson Healthcare was deploying more than 300 healthcare providers to Albany and almost 600 across the state. Noting the Jackson portfolio of companies based in Alpharetta was being bombarded by clinicians wanting to help fight the pandemic, Jackson said. “Frankly, so many of them have said, ‘you need to send me wherever I can be best used.’ ”

As of mid-April Jackson had already added 65 providers at Phoebe Putney’s main campus, with 80 more to arrive the next week and almost 50 more slated to staff the state’s temporary medical unit in Albany. With 12 ICU beds and 15 general beds for COVID-19 patients only, the Albany unit was one of four set up across Georgia to meet the pandemic’s overflow demands.

One of the nation’s largest healthcare staffing firms, Jackson Healthcare “has helped more than 2,500 medical professionals step forward to respond for COVID-19 positions throughout the country,” according to the company’s “US Response Map.”

Meanwhile up in the Northeast, Floyd Lee Locums was demonstrating the power of personalization for clients in need. “Probably because we’re a small, relatively new player in the locum tenens industry, we’ve been able to pivot and deliver highly personalized workforce solutions to our clients,” CEO Lee observed. “For example, although we didn’t even place respiratory therapists, we quickly put together a large team of them for a New Jersey facility back in April–some of whom are still on the ground there. The head of the respiratory therapy department said she’d never seen a more clinically competent and committed team.”

“We also placed a doctor of internal medicine in a nursing home for three months, with a 24/7 live-in schedule, to take care of non-COVID patients,” Lee added.

Underscoring the locum tenens industry’s desire to contribute during a national crisis, Locums Choice’s Campbell said his fledgling company “sent providers to hot spots like New York City and New Orleans–and we even sent some at cost to help strapped facilities and health systems meet unprecedented demand.”

Inconsistent Locums Demand

Noting the feast-or-famine nature of coronavirus’ effect on US healthcare, Campbell observed, “We’ve seen a fairly steady rate of cases in larger cities, while demand from facilities in less-populated areas like upstate New York completely dried up.”

Tusk’s Brunson concurred. “The demand for some specialties like surgery has decreased due to certain areas’ not performing elective surgeries,” he said. “We have yet to see a ‘surge’ in any one specialty. However, there remain high-demand geographic areas searching for multiple specialties.”

Interim’s Hand said his team had seen demand increases in specialties like critical care and pulmonology over the past few months. “Now that routine procedures and elective surgeries are beginning to pick back up, we’re starting to see greater demand in surgery and anesthesia–for both MDs and nurse practitioners/CRNAs.” Similarly, Floyd Lee Locums has experienced the greatest volume in critical care and anesthesiology — especially CRNAs.

Locum Staffing Jobs, Physician Trends

The good news from this year’s challenges thus far: none of the companies with whom we spoke directly have had to lay off or furlough employees as a result of COVID-19. “Actually, we’ve hired during the pandemic,” said Lee, CEO of three-year-old Floyd Lee Locums.

On August 7, Staffing Industry Analysts reported her company had named Jennifer Schultheis to its senior leadership team as VP of business development. “Schultheis previously worked as national sales director at ProLink Healthcare and was regional VP at Supplemental Health Care prior to that,” according to SIA.

Tusk’s Brunson noted, “Thankfully, we have been able to avoid [furloughing or laying off employees]. Our focus remains keeping our culture intact and our team safe.” He added that one trend his team is seeing emerge is “a significant uptick in providers accepting permanent positions.”

Also having avoided employee layoffs or furloughs, Interim’s Hand said his team had recognized another trend: “Considering that physicians and other advanced practitioners have also experienced furloughs and layoffs this year, we’ve witnessed greater interest in trying locum tenens. While this is likely a temporary trend resulting from the pandemic, it also has provided relief for clinicians pushed beyond their limits in these unpredictable times.”

Regarding how Interim’s staff in the Dallas, St. Louis and Atlanta areas have been working this spring and summer, Hand said, “ Right now it’s up to our people to choose. They work where they feel most comfortable working. We were already set up to work virtually, so business processes haven’t changed that much.”

While Interim hasn’t added video interviews during the pandemic (as many companies outside the locum tenens industry have), Hand said locum tenens traditionally has been an over-the-phone business. He added that with its existing presence in critical care, his company has mostly been working with existing clients. “There’s not much new sales activity going on out there,” he observed.

Lee noted her company is finding hospitals generally more open to using contractors during these unpredictable times. She also suggested that roughly 90% of the clinicians working with Floyd Lee Locums are doing so because “they choose it as a long-term work style.”

“Seventy-nine percent of locum tenens staffing companies in [SIA’s July Pulse Survey] predicted an increasing trend in new orders over the next six months.”

Locums Industry Outlook

Regarding the outlook for the remainder of 2020 and beyond, Locums Choice ’s Campbell said he expected “more of the same, unfortunately. Even with elective surgeries back, patients are uneasy about getting them scheduled. Hospitals are filling back up with noncoronavirus patients, but don’t have the budget for large locum tenens spending due to slow first and second quarters.” Campbell said he expects the downturn to “trickle into next year.”

Meanwhile, Hand offered, “ Probably the best indicator of how the industry’s doing is the public companies’ reported results. StaffCare (a division of AMN ) was down 20 percent for Q1. The shortfall might increase to 30% for Q2. The consensus seems to be we’ll be off by about 25 percent for 2020. A lot depends on Q4, whether a vaccine becomes available, etc. I think we’ll be down about 15 percent from last year’s revenue number, maybe less.”

Both Brunson and Lee expressed optimism about business prospects in the coming months, with the former predicting, “The fourth quarter will likely bring the highest increases in job orders in 2020.”

Tusk ’s Brunson continued, “We believe our company will continue to serve our clients and expand into additional service lines that were not in our plans at the beginning of 2020. Our clients are requesting different types of healthcare providers and we are rapidly adjusting to that new environment. The industry will also change and adapt to new and better ways to serve clients. The demand for healthcare providers has not gone away, rather, it has been adjusted.”

Similarly, Floyd Lee Locums ’ Lee observed, “We’re seeing improvements in order flow. I think people in the locums industry will settle down and start getting back to normal in September/October. I think that as the healthcare industry adapts to this ‘new normal’ over the coming months, so will we. And we plan to be well-positioned for it.”

As for 2021, Hand said there are so many variables right now it’s really hard to make much of a forecast. However, Brunson took a stab at it: “I believe 2021 will reward companies that have been able to remain agile and service-focused. New opportunities within healthcare delivery will develop new lines of business and different ways to consider providing value to our clients. We remain bullish on locum tenens staffing.”