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3 Financial Considerations for Residents Interested in Working Locum Tenens

By: Dr. Miechia Esco | Updated on March 03, 2022

3 Financial Considerations for Residents Interested in Working Locum Tenens

Choosing where and how you want to work after residency can be daunting. There are so many different factors to take into consideration, such as where you want to practice, how you want to practice, and how often you want to practice. A locum tenens model of employment is appealing because it gives you the flexibility to choose all three. However, there are unique financial considerations to take into consideration, too.


One of the most appealing aspects of locum tenens work for those who have just completed their residency is the pay. If you were to break down the salary you’d receive from a hospital or other healthcare facility per day, locum tenens work typically pays much higher. For this reason, locum tenens work is especially appealing for those who are trying to pay down student loan debt they accrued while in medical school or those who are saving to eventually open their own private practice.

Ultimately, the pay for locum tenens clinicians is determined by the hospital or healthcare facility where they’re on assignment, and it varies based on specialty area and length of contract. If you have questions about what your pay might look like if you choose to work locum tenens, speaking with a recruiter can give you a good idea of the range you can expect to receive. If you choose to work with LocumTenens.com, you’ll be paid weekly, and all travel, lodging, licensing and credentialing costs are covered by the agency.


As a locum tenens clinician, taxes are not taken out of your paycheck, as you’ll be considered an independent contractor. However, reputable locum tenens agencies will be able to provide you with resources and connect you with reputable accountants who are familiar with both federal and state tax laws so they can help guide you to make the best financial decisions.

It’s important to be mindful that you’ll need to pay state taxes in the states in which you work. For example, if you live in Florida, but you do locum tenens work in California, you would need to pay California state taxes. An accountant can help you navigate situations like this and also share the tax advantages that come with working as an independent contractor, the 401k advantages you’ll receive, as well as details about cash balance plans that are tax advantageous.

I personally prefer to pay my taxes quarterly rather than annually so the amount I owe doesn’t accrue all year, but an accountant can help you figure out what will work best for you. Some locum tenens clinicians prefer to open an LLC, but this isn’t necessary, especially if you’re only working locum tenens part time.

Malpractice Insurance and Health Insurance

If you work with a reputable locum tenens agency like LocumTenens.com, they’ll cover the costs of malpractice insurance, which can be rather expensive. This is another reason why many physicians and advanced practitioners choose locum tenens work post-residency. The malpractice insurance LocumTenens.com provides for their clinicians includes tail coverage, which is important to ensure you remain protected even after leaving your assignment.

As an independent contractor, you’ll need to purchase your own health insurance. LocumTenens.com connects its clinicians with physician and advanced practitioner-specific vendors who can help you select and purchase a plan that works well for you and your family members.

Navigating the financial aspects associated with locum tenens work may seem daunting, but when you’re working with the right agency, it doesn’t have to be. For more information about working locum tenens post-residency, check out LocumTenens.com’s resources for independent contractors, or speak with a recruiter today.

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About the author

Miechia A. Esco

Dr. Miechia Esco is a vascular surgeon focused on full-time locum tenens work and licensed in 15 states. For the past several years she has served as a consultative member on the LocumTenens.com Customer Advisory Board and now serves as the company’s Chief Medical Resource Advisor.