considering locums...

[smg13]

Hi everyone, I'm an IM PA x 7 years that is planning to go locums in 2 months.  Have worked in both urgent care and outpatient settings, rural and urban. Wondering if anyone has any thoughts on the questions below:

1.  Do people tend to work with one agency, or do you move from agency to agency?  

2.  Any preference regarding W2 vs 1099 status?

3.  I've been in contact with Comphealth and Barton- any comments on experiences with either?

4.  Insight on hourly rates and housing reimbursement for San Diego and Los Angeles?  I'm looking mostly at FP, clinic IM, and UC positions.

Thanks for taking the time to respond.

[EMEDPA]

I think as long as you leave on good terms there is no problem working with multiple companies. Some of the larger companies like comp health are more of a quasi-locums situation as people often do multiple back to back contracts for them and I believe they provide some benefits and retirement. Some of the larger companies arrange the housing and rental car for you so you don't have to deal with reimbursement. I would always take w2 over 1099 as 1099 requires you to file quarterly estimated taxes and pay both parts of social security tax. I am doing this now(not by choice) and it puts me in a 50% tax bracket( 25% federal, 10% state, 15% social security).

[Boatswain2PA]

I work with one local agency, and then do some on my own.  I make about 15-20% more when I am on my own contract instead of through this agency.  Either way (through this agency or on my own) I have my own medmal.  I have talked with recruiters at some of the big companies but the pay/compensation was never anywhere near enough for me to work with them.

I prefer 1099 because of the tax deductions (mileage, 1/2 of travel meals, phone, go to whatever conferences I want with deductible travel, etc).  Furthermore I have a SEP-IRA that lets me put up to $53,000/year into retirement pre-tax.

I have no idea what rates would be like in SD or LA, however it doesn't seem like those areas would be ripe for locums work.  Most locums places rely on locums because they are 1) places where most professionals don't want to live, or 2) so terribly managed that they can't keep providers (or both).  Lots of professionals like living in SoCal, so I would be wary that any locums site would be heavy on #2.

Emed brings up the social security taxes. Remember with W-2 the employER pays half of that 15% social security tax, so right off the bat 1099 pay is 7.5% less than W-2 pay.  Then remember there will be no PTO, no 401K match, no CME, no licensure, and sometimes no MedMal and you have to factor those in to what you will demand for payment.

Emed - I'm sure you just simplified for brevity, but taxes are much more complicated than your 50% scenario.  For example, under the new tax laws you don't hit the 25% until your AGI (Adjust Gross Income - gross income minus expenses including retirement contributions, standard deduction of $24K, etc) is at $165,00, and this is AFTER deductions.  Furthermore, the 15% social security tax phases out at $135,000 (I think that's still the number).  So, you pay 25% (10% FICA + 15% SS) on the first $10K AGI, then 27% (12% FICA + 15%SS) on AGI from $10K-$77K.  Then the pain starts when you pay 37% (22% FICA + 15%SS) from $77K-$135K.   But then there is the "donut hole" when you have reached the max SS, and that 15% drops off.

But WAIT, there's MORE!!!  Thanks to President Trump's 2017 tax plan, 1099 contractors (who make less than $315K for married) get an additional "pass through deduction" of 20% of their "qualified business income".  I think this means you will take your 1099 income, subtract expenses, THEN subtract 20% for the pass through deductions, then deduct the standard deduction, and then apply the tax rates.  Not sure where this fits in with the 15% SS tax.

I retain 33% of my take home for taxes (sorry you have 10% state income tax...that's aweful) and pay it quarterly online, just takes a few minutes.  One caveat to that is that I also work part time W-2, and my wife is RN who makes good money, so we have employers who also throw in 7.5% to the social security for the first $80-$90K of that $135,000 phase out (so I'm only paying 15% on about $55K of it....if that makes sense).

[quietmedic]

1.  Do people tend to work with one agency, or do you move from agency to agency?  

             I've worked with more than one agency, though not at the same time. Nothing wrong with taking jobs from wherever they come.

2.  Any preference regarding W2 vs 1099 status?

              I hate 1099, quarterly estimated payments are a pain in the butt. That being said, i don't think locums are big on W2. So throw an accountant a few bucks to help you out, and keep pay stubs and meticulous financial records.

3.  I've been in contact with Comphealth and Barton- any comments on experiences with either?

              Nope. I've used Execu-search and Consilium, both of which were fine. I'd personally always prefer an agency that gets paid a lump hiring sum rather than gets paid an hourly wage on top of yours...the latter is a higher risk of the actual job getting tired of paying fees, rather than buy you out in one shot.

4.  Insight on hourly rates and housing reimbursement for San Diego and Los Angeles?  I'm looking mostly at FP, clinic IM, and UC positions.

              No clue, sorry. UC on the East coast is anywhere from $50-80/hour, usually around $60-70 with experience.