Staffing agencies placing more physicians

Second-quarter results from publicly traded health care staffing companies signify that demand for physicians, particularly those willing to fill locum tenens assignments, is starting to inch up. The number of permanent physician placements by these agencies has held steady, although that does not mean there are fewer jobs for MDs and DOs.

"There's no unemployment for physicians," said Jim Brill, senior vice president and chief financial officer with On Assignment, based in Calabasas, Calif. While companies did not report specific hiring totals, they said revenue and profit gains were a result of greater demand for doctors.

Medical staffing professionals believe the economic recovery in that quarter may have increased the demand for elective medical care, which upped demand for temporary physicians. Demand for permanent physician placement by these companies may not have grown, because hospitals and large health systems are hiring an increasing number of doctors but are recruiting more on their own.

"We anticipate continued modest improvement in the overall locum tenens business. ... The physician search market has been steady but is still not growing," Susan Salka, president and CEO of San Diego-based AMN Healthcare Services, said during an Aug. 4 conference call, when the company's second-quarter earnings results were released. "While hospitals are hiring more physicians, many of them have significantly increased their internal recruiting resources."

AMN's locums tenens segment, which is handled by Staff Care in Irving, Texas, and Linde Healthcare in St. Louis, generated $71 million in revenue. This represented an increase of 1% from the prior quarter and 9% growth from the second quarter of 2010. Demand for primary care physicians drove much of the expansion.

The company handles permanent physician placement through Merritt Hawkins & Associates in Irving and Kendall & Davis in St. Louis. AMN brought in $9 million from permanent physician placement, a decline of 13% from the previous quarter but an increase of 14% from the second quarter of 2010. The drop, however, is primarily due to new accounting standards.

"Without the impact of the deferred revenue, accounting changes, which were implemented in the first quarter, revenues would have been flat with the prior quarter," Salka said.

Other publicly traded companies also released positive results for physician staffing.

On Assignment, which released second-quarter results on Aug. 3, generated $17 million from physician staffing, both permanent and temporary. That represented a decrease of 7.7% compared with the second quarter of 2010, but a 2.9% increase from the first quarter of 2011.

"Exiting the quarter, revenues in our physician staffing segment grew year-over-year in June for the first time in 22 months," Peter Dameris, CEO and president of On Assignment, said in a statement. "We anticipate a continued resumption of growth in our physician staffing segment."

The company handles physician staffing through Vista Staffing Solutions in Salt Lake City.

Cross Country Healthcare, based in Boca Raton, Fla., released its second-quarter results on Aug. 3. Physician staffing, both permanent and temporary, generated $30.6 million, an increase of 4% from the first quarter of 2011 but a 2% decrease compared with the second quarter of 2010. The company handles physician staffing through Medical Doctor Associates, based in Norcross, Ga., and Cejka Search in St. Louis.