When exploring a career change to travel nursing many RNs may wonder if they should pursue becoming an independent nurse contractor. Can you travel nurse without a travel nurse agency and will you make more money by doing so? The bottom line is: Yes! But there are some catches.
The questions we’ll address here are:
- How much more money do independent nurse contractors make?
- What do you need to be aware of when travel nursing independently?
- How can you find your own travel nursing contracts?
Let’s cut to the chase with the answer everyone is looking for:
Will you earn MORE money as an independent nurse contractor?
Can you earn more without a travel nurse agency?
The answer is yes, if you’re smart about it. Independent travel nurse have the potential to earn 10-15% more in annual income than travel nurses that work through a travel nurse agency.
That 10-15% is contingent on whether or not you can keep your personal costs down. There are a few things you’ll want to keep in mind when calculating your income potential:
- Taxes are not withheld from your paychecks as an independent contractor.
- You’re required to make quarterly tax payments to the IRS based on your estimated income.
- As an independent contractor you’ll be responsible for paying the entirety of your Medicare & Social Security taxes, whereas if you were an employee, your employer would pay half of those taxes.
- There are several deductions you can take as an independent contractor to offset your taxes owed, so you’ll want to factor in the cost of hiring a CPA who specializes in taxes for independent contractors.
- As an independent contractor you’ll need to cover the full cost of your health insurance.
- As an independent contractor you won’t have any additional benefits such as paid time off, or 401K options.
- As an independent travel nurse, you’ll be responsible for your own credentialing fees.
Why do travel nurses earn less by working with a travel nurse agency?
A question you might be asking is, why would I earn 10-15% less working with a travel nurse agency, than if I just travel nursed on my own?
Well, like any business, there are overhead costs associated with running a travel nurse agency. Some of those include matching employer taxes on each employed nurse, providing health insurance, paying legal fees and covering the costs of employee salaries and office expenses.
Smaller agencies will have less overhead costs and can often pay their nurses more than larger travel nurse agencies.
Benefits of working with a travel nurse agency
Travel Nurse Agencies Are Market Experts
A good agency understands local and regional markets and will know the limits of how high rates can go within each specialty and at each facility. Utilizing this knowledge, they’re able to effectively negotiate the highest pay rates for individual nurses.
Here are 3 examples:
- Two facilities in the same zip code can offer vastly different rates depending on their individual needs.
- Different specialties at the same facility will also often offer vastly different rates depending on their individual needs.
- A contract that was valued at $45,000 one week, could be valued at $55,000 the following week.
Travel nurse agencies are also “in the know” when it comes to hospital censuses. With close relationships within those hospitals, they’ll be the first to know when a need for more nurses goes up or goes down. The higher the need, the more room a travel nurse agency has to ask for a higher pay rate for their individual nurses.
Access to More Jobs
Good travel nurse agencies have strong relationships with hundreds (if not thousands) of healthcare institutions throughout the country. These relationships often result in hospitals making travel nursing contracts available exclusively to one agency or another. The hospital benefits because they have access to thousands of nurses at any given time, and nurses benefit because they have access to thousands of travel nursing jobs at any given time.
Less Administrative Work
As an independent contractor you would be responsible for several things that can be both timely & costly.
These include:
- Doing your own credentialing.
- Covering the cost for health insurance.
- Developing your own contract template to send to hospitals (hospitals do not provide the individual contracts for travel nurses).
- Hiring a CPA to consult for tax filings, especially if you plan to work in multiple states.
- Becoming a market expert and keeping up to date on hospital censuses and learning what the market rate is for your particular specialty.
- Effectively negotiating those rates with hospitals
Superior Negotiation Tactics
Good travel nurse agencies have a team of qualified and experienced recruiters that are skilled at negotiating the best rates and benefits for their nurses.
Good recruiters will always be on the look-out for:
- A higher rate
- A sign-on and/or completion bonus
- Block-scheduling
- Overtime pay
- Restrictions on a contract such as “no float,” or “no weekends”
How can you find your own travel nursing contracts?
You will need to have or develop a strong relationship with one individual hospital, or several hospitals. You can do this by:
- Becoming a staff nurse at your hospital of choice, or
- Travel nursing to different hospitals and developing those independent relationships
After you’ve developed a solid relationship, you would then want to speak to your Unit Manager, Unit Director or Chief Nurse Office about your interest in going independent. They will likely refer you to either the head of talent acquisition or the head of supply chain management.
You could also call a hospital and ask to speak to their staffing office who should be able to direct you to the person that handles agency staff contracting.
Do hospitals hire independent nurse contractors?
It is super rare for hospitals to hire an independent contractor, but possible if you have a personal relationship with them. In general, smaller, rural hospitals don’t use too many travel nurse agency staff and are more likely to hire independent contractors than some of the larger institutions like HCA Healthcare, Providence Health or Dignity Health. We spoke to our CEO, John Nolan on the subject as he’s been in the travel nursing world for over 10 years:
I’ve never personally met a nurse who has worked independently in the travel nursing field. I think in general, it’s super rare. It’s likely less than 1% of hospitals would hire an independent travel nurse. But I think it can be done, it would just take a lot of work and “know how” on the nurse’s part and a tight relationship with a particular hospital. I’d only recommend this path if the nurse was planning to work for a hospital for a long time, just given the amount of effort it would take to secure a good contract.
How much money do travel nurse agencies earn by placing you in a contract?
A travel nurse agency will earn anywhere from 10-25% per contract. The agency then needs to factor in costs like credentialing, insurance, legal fees and overhead costs. In the end most agencies will take-home between 3-5% per contract. So, if a travel nurse works a 13-week contract valued at $45,000, the agency will earn between $1,350 and $2,250 for that one contract.
It’s wise to consider working with an agency that has low overhead costs (such as some of the smaller agencies) because they’ll be able to get you a higher rate, since they don’t have as many costs to cover as some of the larger agencies.
Would you like to become an independent nurse contractor?
What do you think? Would you like to travel nurse without a travel nurse agency? Or do you think the benefits of working with a travel nurse agency outweigh the potential to earn more? Let us know in the comments below!
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