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If your healthcare organization still considers locum tenens coverage as a temporary solution, you’re not alone. But locums also provide access to care, maintain staffing levels, and can bring in additional revenue, too.
One unfilled physician role can cost more than $2.4 million in lost annual revenue. Yet many organizations are still reluctant to fill gaps with locum coverage. The result can be weeks or even months of lost billable care, overextended teams, and reduced patient access to care.
That isn’t the case for every healthcare organization, though. Those that incorporate locums into their broader workforce strategy are proving that it's possible to preserve revenue, stabilize operations, and even grow strategically. Here’s how to build a staffing strategy that provides a return on investment from locum physicians.
1. Start billing from day one
Margins are on every healthcare administrator’s mind, and every day a physician works without being billable is a missed opportunity.
Payer enrollment can be complicated, and with so many moving parts, it’s not surprising that many locum providers are never even enrolled. Credentialing and payer enrollment delays remain among the most common and costly reasons for revenue loss among locum hires. According to CHG Healthcare data, systems that delay payer enrollment by 120 days lose, on average, $122,000 per locum in unbilled services.
Top-performing organizations initiate the payer enrollment process in tandem with credentialing, ensuring that physicians are correctly enrolled with top payers in a timely manner. This way, locums can start seeing patients with full billing capabilities from the very first day. This shift alone can transform your locums program from a line-item expense into a revenue-preserving asset.
Increase your revenue: 7 ways to improve your locums payer enrollment process
2. Standardize your physician locums billing process
A standardized, repeatable billing process for locum tenens providers can help your organization ensure you’re collecting as much as possible from your payers.
The most successful organizations typically follow a strategic process:
- Establish ownership. Assign a dedicated lead to oversee the locum lifecycle, from sourcing to billing, to fully understand the scope and breadth of usage.
- Standardize billing and onboarding. Create templates, workflows, and checklists to reduce delays and variation.
- Track performance. Monitor key metrics, including time to credential, revenue per day, and missed billing opportunities.
3. Be proactive when it comes to hiring
Too often, organizations lack a trusted physician staffing partner to help them mitigate the downstream financial and operational impacts of physician vacancies.
Having a plan for physician vacancies can make staffing transitions smoother while preserving patient access to care and physician workforce morale. For example, a health system with a proactive strategy to address physician vacancies can start sourcing a locum physician immediately.
Contrast that with a reactive scenario. A similar role, with no physician workforce strategy, went unfilled for over 120 days. The organization incurred $768,000 in lost revenue and over $384,000 in turnover costs, not counting the lifetime value of patients who may have ultimately gone elsewhere for care.
High-performing healthcare systems plan for physician vacancies and the interim. By planning ahead for coverage, you can maintain both continuity of care and income.
Watch the webinar: 5 ways healthcare organizations can generate more revenue
4. Treat locums as strategic investments
Many health systems still view locums as short-term stopgaps, whereas those who use them strategically are unlocking value. These organizations have implemented standardized processes and treat locums as integral to physician workforce planning.
Strategic physician locums utilization provides:
- Soft launch of new service lines
- Test market demand
- Expanded care into rural or hard-to-fill regions
- Increase throughput in high-margin departments
- Strengthen long-term recruitment pipelines
- Reduce team burnout and turnover
In one real-world example, a hospital faced the sudden departure of its entire neurosurgery team and used locums to maintain a 95% program capacity over a two-year period. The hospital retained gross patient revenue streams, avoided patient care gaps, and created an onboarding bridge for new surgeons. One locum physician ultimately transitioned into a leadership role as a program director.
Maintain quality: How locum tenens physicians compare to staff physicians in quality of care
How to improve hospital revenue today
You don’t need to overhaul your entire physician staffing model overnight. It’s best to start with small, focused changes, allowing you to monitor effectiveness while also giving staff time to learn and implement new processes.
Here are some ideas for strategic change:
- Identify your highest-risk service lines and locations
- Audit how long it takes a locum to become billable
- Begin payer enrollment earlier and concurrent with credentialing
- Standardize your process, even if it’s just the onboarding checklist
- Schedule a quarterly review to evaluate locum tenens ROI
Each change you implement reduces friction, preserves lost revenue, and sets the stage for a more strategic workflow in the future.
Locum tenens physicians can help you grow
Locum tenens can be far more than temporary coverage. When deployed with intention, locums protects revenue, extends access to care, helps prevent staff burnout, and supports health system growth in ways that traditional hiring doesn’t support. To learn more, download the full locum tenens ROI report or click below to learn more.
Schedule a workforce strategy session or risk assessment consult with a CHG Healthcare physician workforce strategist. We’ll evaluate your locums utilization, capture unrealized care opportunities, and provide insights on how to better manage your provider pool. Call CHG at 866.588.5996 or email ecs.contact@chghealthcare.com.
This article was created with the assistance of AI technology.
