The Basics About The Contracts Between Travel Nursing Companies and Hospitals
A travel nursing company must have a contract with a facility in order to send travel nurses to work at the facility. It’s important for travel nurses to have a basic understanding of these contracts and their impact on the travel nurse. So, in this article, we’ll provide an overview of these contracts so travel nurses can better navigate the system.
First, it’s important to note that the contracts we’re talking about here are different than the contracts that the travel nurse actually signs with the agency. Instead, the contracts we’re discussing here are between the facility and the travel nursing agency. Travel nurses will rarely if ever see these contracts, but they’re still important for travel nurses to know about.
What Do the Agency/Hospital Contracts Cover?
While contract provisions differ from contract to contract, it is standard for the contracts to contain a common set of provisions. These provisions include but are not limited to:
- Bill rates
- Solicitation clauses
- Liability insurance requirements
- Contract termination rules
- Shift guarantee and cancellation policies
- Compliance and record management policies
- Billing and collection policies
Many of these provisions have a direct impact on the travel nurse. For example, the bill rates determine how much money the agency can pay for a particular job. The shift guarantee and cancellation policies determine whether or not the shifts are actually guaranteed or not.
Ultimately, the agency will include many of these provisions in the contract they provide to the travel nurse. For travel nurses, it’s important to note the fact that such provisions differ from hospital to hospital is why they can differ in the travel nurse’s contracts even when the contracts are with the same agency.
The Types of Hospital Contracts
These days, the contracts between hospitals and agencies typically take one of three forms. First, some hospitals sign contracts directly with individual travel nursing agencies. We refer to this type as direct contracts or direct relationships. These contracts are becoming exceedingly rare these days.
Second, some hospitals sign a contract with a third-party software provider who then manages the contracts with agencies. The hospital and the agencies use the software application to manage all communication and documentation.
We refer to this type as a Vendor Management System (VMS) contract. In its purest form, the software application is “vendor neutral”, meaning its not owned or beholden in any way to any travel nursing agency. This type of contract is also becoming rare. However, the buzz around the industry indicates that hospitals have a strong desire for them, so perhaps they’ll start to become more common.
Finally, some hospitals sign a contract with a single healthcare staffing agency who then subcontracts with other agencies to help fill all the openings. We refer to this as a Managed Service Provider (MSP) contract. We refer to the single staffing agency with the contract as the exclusive provider or the Managed Service Provider.
This type of contract has grown dramatically over the past 10 years. However, the buzz around the industry indicates that hospitals are underwhelmed and desiring alternatives, so perhaps they’ll become less common.
The Difficulty in Landing Hospital Contracts for Travel Nursing Agencies
Obviously, securing hospital contracts is a top priority for travel nursing agencies. Larger agencies have teams of Account Managers and high-level sales executives engaged strictly in landing new contracts. In smaller agencies, this responsibility may fall to a single Account Manager or the company’s top-level leaders.
The difficulty level in securing these contracts tends to vary with market conditions and innovations. For example, hospitals, MSPs and VMSs are much more open to signing up new staffing agencies when hospitals have high demand for travel nurses.
That said, it’s important to note that agencies are rarely, if ever, able to sign these contracts on the fly.
Make Sure the Travel Nursing Company Has a Contract
And that represents perhaps the most important thing for travel nurses to know about the contracts between hospitals and agencies. Basically, agencies must have a contract with a facility in order to work with the facility. For the travel nurse, this means you shouldn’t rely on an agency to get you work at a specific facility unless they already have a contract with the facility.
If you’re attempting to work in a specific state, or in a specific city, or in a specific hospital, you must be certain that the agency has the contracts necessary to get you there. Do not rely on a company that does not have the contracts already in place!!
