Residency Advisor
What do you actually gain—and what do you quietly give up—when you walk away from a full‑time employed job to do locums, PRN, or per diem work?
Let’s cut through the jargon. These three terms get thrown around interchangeably by recruiters and administrators who honestly do not always understand the difference themselves. If you’re post‑residency or mid‑career and trying to protect both your income and your sanity, you cannot afford that confusion.
Here’s the clear breakdown.
First: What Each Term Really Means (In Real Life, Not HR-Speak)
You’ll hear five different explanations from five different recruiters. Ignore those. Functionally, this is what most physicians in the real world experience:
Locum Tenens
You’re an independent contractor (usually through an agency) filling a temporary staffing gap at a hospital or clinic. Think travel doctor. High hourly/daily pay, fixed date range, often away from home, minimal benefits, lots of paperwork at the front end (credentialing, licensing).PRN (“pro re nata” – as needed)
You’re employed directly by the hospital or group, on an as‑needed basis. You’re usually in their system as staff, sometimes with limited benefits. You fill shifts they cannot cover with the core full‑time team.Per Diem
In many places, “per diem” and PRN are identical. In some systems, per diem is more strictly shift‑based, less commitment, fewer benefits than PRN. Paid by the day or shift; you’re staff, but with looser ties.
Bottom line:
- Locums = contractor
- PRN/Per Diem = employee (usually)
That one distinction drives taxes, benefits, malpractice, and how much control you have.
| Category | Value |
|---|---|
| Locum | 190 |
| PRN | 150 |
| Per Diem | 145 |
| Full-time Base | 120 |
These numbers are illustrative, but the pattern is accurate in many specialties: locums pays the most per hour, full‑time pays the least per hour but adds benefits and stability.
How Each Option Impacts Your Money, Time, and Freedom
Let me break it down the way you actually think: money, schedule, and how much of your life you sign away.
1. Income & Taxes
Locum Tenens
- You’re usually paid a flat daily rate (e.g., $1,800–$2,400/day for hospitalist; more for some specialties).
- No employer‑paid benefits, no PTO, no retirement match.
- You’re a 1099 contractor. That means:
- You pay both sides of Social Security/Medicare (self‑employment tax).
- You can write off business expenses: travel (sometimes), CME, licensing, equipment, home office, etc.
- High gross income; your net depends heavily on how organized you are with taxes and deductions.
PRN / Per Diem
- Paid hourly or per shift. Rate is usually higher than core FTEs but lower than locums.
- Often W‑2 employee:
- Taxes withheld automatically.
- May or may not get access to retirement contributions, partial benefits, or differential pay.
- No or limited paid time off. You’re paid for hours worked, nothing more.
| Option | Pay Type | Tax Status | Benefits |
|---|---|---|---|
| Locum | Daily/hourly | 1099 | Rare/none |
| PRN | Hourly | W-2 | Limited/variable |
| Per Diem | Shift/day | W-2 | Minimal |
| Full-time | Salary/RVU | W-2 | Full package |
If your main goal is maximize cash in 1–3 years (pay off loans, build a down payment, fund a big life change), locums usually wins on raw earning potential.
If your priority is solid income with low admin and low tax complexity, PRN/per diem is easier.
2. Schedule Control, Lifestyle, and Burnout Risk
Locum Tenens
This is where locums shines and also where some people crash and burn.
Pros:
- You can say no. To entire contracts. To weekend call. To that toxic hospital down the road.
- You can batch your work: 7 on/7 off, or 14 straight then 2 weeks off. Great for travel, family, or side projects.
- You can choose geography: rural Midwest this month, coastal California next.
Cons:
- You’re often going where they’re most desperate. That can mean:
- Understaffed units.
- Dysfunctional EMRs.
- “Can you just sign these 20 notes from last week while you’re here?”
- Travel fatigue is real. Constant new passwords, new workflows, new nurses learning your name every week.
- You’re not building a local community at work. You’re a visitor.
PRN / Per Diem
Pros:
- You generally control your availability. You submit “available days,” they plug you in.
- You stay in one system: one EMR, same nurses, same consultants.
- Much easier to combine with family life, local commitments, or another part‑time job.
Cons:
- Your schedule is at the mercy of need. Slow season? You might get fewer shifts.
- Some places start treating reliable PRN docs as “almost full‑time” without the benefits. You have to guard your boundaries.
If geographic flexibility and the ability to take large chunks of time off are top priority → locums.
If stability plus flexibility within one city or health system is your target → PRN/per diem.
Career Trajectory: CV, Networking, and Future Options
Here’s where people get nervous: “Will doing locums or per diem hurt my future job prospects?”
Short answer: No, if you are strategic. Yes, if it looks like chaos.
How Each Option Looks on Your CV
Locums
If you do locums for 1–3 years and:
- Work through one or two major agencies, and
- Have multi‑month engagements at each site,
Most employers interpret that as: you were deliberate, you wanted flexibility or to explore regions, then you’re ready to settle.
What looks bad:
- Ten different 1‑month contracts in one year, all unrelated, with gaps you cannot explain.
- No references who really know you.
PRN / Per Diem
This is easy to frame:
- “I worked PRN hospitalist at X Medical Center while building my outpatient panel/family obligations/research project.”
- “I wanted flexible work while my partner finished training and we finalized relocation.”
Most department chairs get this. Half their early‑career hires did something similar.
Networking and Reputation
Locums:
- You meet a ton of people, but shallowly.
- If you’re consistently good, word spreads among medical directors and agencies. You get better offers.
- If you’re sloppy or difficult, that also spreads. Fast.
PRN/Per Diem:
- You become “one of us” locally, even if you’re not full‑time.
- Easier path to convert to a permanent role if you want it later.
- You can quietly test a system before committing.
If your long‑term goal is partnership or leadership in one area, PRN/per diem in that system is smart.
If you genuinely don’t know where you want to land or want to stay non‑anchored, locums gives you more exploration.
Risk, Stability, and Legal Details You Should Not Ignore
This is where young attendings get burned because no one ever explained it properly.
Malpractice Coverage
Locums
Most reputable agencies provide malpractice with tail. But you must confirm:- Occurrence vs claims‑made.
- Tail coverage: who pays when the contract ends? Get this in writing. Not in a recruiter email. In the contract.
PRN / Per Diem
Typically covered under the hospital or group policy just like full‑time staff. Less to manage personally.
You do not want to be buying multiple tails out of pocket. That can erase a lot of “high locums income” very quickly.
Contract Stability & Cancellations
- Locums
Sites can sometimes cancel or cut back shifts if volumes drop. Good contracts have cancellation clauses with guaranteed minimums or notice periods. - PRN/Per Diem
Your worst enemy is “low census.” If you’re at the bottom of the seniority list, you’re cancelled first.
| Step | Description |
|---|---|
| Step 1 | Start - Need Flexibility |
| Step 2 | Consider Locums |
| Step 3 | Consider PRN |
| Step 4 | Per Diem in One Hospital |
| Step 5 | Locums Focus |
| Step 6 | Hybrid - PRN plus Occasional Locums |
| Step 7 | Join One or Two Local Systems |
| Step 8 | Review Malpractice and Tax Plan |
| Step 9 | Primary Goal |
| Step 10 | OK With Travel? |
If your risk tolerance is low and you’re the primary household earner with a big mortgage, be honest with yourself. Pure locums with no savings buffer is reckless.
Matching Each Option to Common Career Goals
Let’s align this with real goals physicians actually have.
Goal 1: Pay Off Student Loans Aggressively (2–5 Year Horizon)
Your best setup:
- High‑pay locums in a reasonably efficient specialty (hospitalist, EM, anesthesia, psych, some surgical subs).
- 7 on/7 off or similar, and use your off weeks to rest, not spend.
- Consider stacking a bit of telemedicine during off weeks only if you’re not frying your brain.
Why not PRN only? Because PRN usually does not hit the same top‑end compensation, and you want to compress earning into a few intense years.
Goal 2: Start a Family, Avoid Burnout, Stay in One City
Your best setup:
- PRN or per diem in one or two local hospitals.
- Spell out in writing your minimum/maximum shifts per month.
- Prioritize predictable patterns (e.g., “I take 4 night shifts a month, always the same week”).
Here you’re trading maximum income for sustainable life design. Smart move long term.
Goal 3: Try Out Different Regions Before Settling
Your best setup:
- True locum tenens.
- 3–6 month contracts in different areas: Midwest community hospital, West Coast academic center, Southern rural site.
- Keep a running list of what you like and hate: staffing, culture, cost of living, call burden, admin politics.
Then, when you’re ready, you target permanent jobs in the one or two places that actually fit you, not where you happened to match as a resident.
Goal 4: Build a Side Business, Academic Niche, or Non-Clinical Career
Your best setup:
- Flexible PRN/per diem, or a hybrid: 0.5 FTE plus PRN.
- You need time blocks, not scattered single days, to build something substantial.
- Locums can work too if you use the 7 off aggressively, but travel may get in the way.
Ask yourself: “Do I need CONTINUITY or just CASH?” Locums gives more cash; PRN/per diem gives more continuity of place and schedule.
A Quick Self-Screen: Which Are You?
Look at this and answer honestly.
| Category | Value |
|---|---|
| Max Money | 90 |
| Schedule Control | 85 |
| Low Admin Hassle | 70 |
| Stay Local | 80 |
| Try Different Regions | 95 |
Now map priorities to options:
- If your chart in your head is heavily skewed to Max Money + Try Different Regions → lean Locums.
- If you’re skewed to Stay Local + Schedule Control + Low Hassle → lean PRN/Per Diem.
- If you want a bit of both, you can hybrid:
- Local PRN base for stable income.
- 1–2 locums assignments per year for extra cash.
How to Decide Today (Without Overthinking It for 6 Months)
Here’s the simple, no‑nonsense way to move forward.
Answer three blunt questions:
- Do you want to move cities/states in the next 2–3 years?
- How much income volatility can you tolerate month to month?
- Do you strongly prefer being an employee (W‑2) or a contractor (1099) for tax/benefits reasons?
Run this quick rule-of-thumb:
- Answered “Yes, want to move” + “Can tolerate some volatility” → Start with locums conversations.
- Answered “No, want to stay put” + “Hate income swings” → Start with PRN/per diem at local systems.
- Torn? → Explore both: talk to a locums agency AND HR at two local hospitals. See who gives you better, clearer options.
Talk to real humans actually doing it.
- Find one physician doing full‑time locums, one doing mostly PRN, one in a hybrid setup.
- Ask them specific questions: “What’s the worst part?” “What surprised you?” “What would make you quit this model?”
Protect yourself in writing.
- For locums: confirm malpractice (with tail), cancellation clauses, housing/travel rules, and rate in the contract.
- For PRN/per diem: get expectations on minimum/maximum shifts, priority vs other PRN staff, and how schedule requests work.
Do this today:
Write down your top two priorities on a sticky note—money, schedule control, staying local, trying new regions, building a side career, whatever they truly are. Then open your email and contact exactly one locums recruiter and one local hospital HR/medical staff office. Ask each for concrete examples of current locum and PRN/per diem roles in your specialty. Compare them against that sticky note. That 30‑minute step will tell you more than another month of thinking about it.
