Are All Clients Charged the Same?

requires him or her to drive for an hour to do a 12 hour shift, and then be requested to drive 1.5 hours in the opposite direction to take over an 8 hour shift.

To figure out what you should be paying a particular employee, you should first establish a benchmark. To be more specific, ask yourself what do you normally charge a client? Deduct 75 percent of this fee and this would be your high-end rate of pay. The client fee might be different, but at least you have a basic formula to prevent overpaying your employees.

At the end of the day, everything balances out. Let’s take the case of John, who is paid $30 for an hour and works for 40 hours every week. Your return on investment (ROI) is $400 and his pay for the week would be $1200. You will be billing the hospital $1600 for 40 hours. John is, therefore, being paid the highest amount you are willing to pay – 75 percent of the gross billing revenue.

On the other hand, Mike is a new graduate, and he makes $20 per hour and works 40 hours per week. You are charging the hospital the same $1600 for 40 hours, but paying only $800 to Mike for his services, leaving you with a ROI of $800.

This different between what John and Mike are being paid will enable you to calculate a $25 per hour pay rate; hence, your agency’s ROI is $1200 for the whole week. You can use this method to calculate the pay for different employees according to their working capacity.

Just like all employees aren’t paid the same, all the clients are not charged the same. The billing rate is subject to negotiation and can change. Your competitors will do it and will try to figure out what you are charging so that they can lower their rates to steal your account. Unfortunate as it may be, it is a very common occurrence in the healthcare staffing agency where competitors adjust their rates in order to present a more ‘appealing’ offer to healthcare facilities.

A hospital with a high volume is much more likely to discuss & negotiate a lower rate as compared to a facility that only uses your services once or twice in a year. It is also a common practice amongst healthcare staffing agencies to lower the rates for clients that have been utilizing the agency’s services for a long time.

Regardless of what rate structure you develop for your staffing agency, make sure only a single person is responsible for negotiating rates with the clients. This could be you or any other person designated by you. Make sure you gauge the needs of each of the facilities including their coverage demands. There can be instances where facilities will refuse to negotiate and simply accept your terms. In such instances, there is no need to offer a lower rate.