Learn How Physicians Can Work as Independent Contractors

Dawn Pascale

The modern world of medicine leans on adaptability, and many physicians now find significant value in assuming roles as independent contractors. Specifically, they’re engaging in locum tenens work. Beyond the flexibility and autonomy, this approach carries other unique implications — particularly in the areas of pay, malpractice insurance, and taxes. Let’s explore.

Understanding Locum Tenens Pay

When you undertake a locum tenens assignment, your pay comes directly from the locum agency — not the healthcare facility you’re working at. Generally, your pay rate exceeds the hourly wage typical of salaried employees. However, unlike the traditional employment model, you need to manage taxes, retirement plans, and insurance independently.

Handling Health Insurance as a Contractor

As an independent contractor, you bear full responsibility for your health insurance. This situation might not affect physicians doing locum work alongside a full-time job, but it does add a layer of consideration for others. You have several avenues for securing coverage, such as joining a spouse’s plan, paying COBRA premiums, enrolling via the HealthCare.gov site, affiliating with professional associations, or consulting with insurance agents.

Navigating Taxes as a Contractor

Tax management can be complex for locum tenens physicians, especially when providing services across multiple states. It’s crucial to use a tax professional experienced in the intricacies of multi-state taxation. Also, you’ll typically report your income as an independent contractor using a 1099 form and pay estimated taxes quarterly.

Closing this journey, remember that while it may initially seem daunting to transition from an employed physician to an independent contractor, the administrative nuances become manageable once you understand them. The benefits of flexibility, choosing your assignments, and a higher pay rate may very well offset the convenience of traditional employment.

MedSource Consultants—Your Physician Resource

At MedSource Consultants, we’re committed to your success as a locum tenens physician. When you partner with us, you join a community dedicated to supporting you throughout the entire locum tenens process — from understanding pay structure and insurance options to navigating the complex tax landscape.

We’re more than a staffing agency. We’re your advocates who also empower you to find the perfect work-life balance in your medical career. Contact us today to explore opportunities that suit your unique needs and aspirations.