How to Get Started in Locum Tenens

Getting started in locum tenens means completing five things, ideally in order: (1) state licensing, (2) selecting an agency, (3) facility credentialing, (4) contract review, and (5) setting up your taxes and business. Plan for roughly 60-120 days from the moment you decide to your first shift.

The order matters because the steps overlap and have very different lead times. Licensing is the long pole — a new state license can take weeks to months — so start it first and run credentialing in parallel rather than waiting for one to finish before beginning the next. In my experience the clinicians who get to a first assignment fastest are the ones who treat this as parallel project management, not a strict waterfall.

The five numbered steps below walk through each stage. Two things to keep in mind throughout: first, the licensing path differs by profession — physicians can use the Interstate Medical Licensure Compact (IMLC), while CRNAs and AAs cannot — and second, the tax and business setup (Step 5) is the part most new locums underestimate, because no employer is withholding anything on your behalf. Get the structure right before your first check clears.

You need an active, unrestricted license in every state where you will physically work — there is no national medical license. How fast you can get those licenses depends entirely on your profession.

Physicians (MD/DO) can use the Interstate Medical Licensure Compact (IMLC), a voluntary expedited pathway covering 43 member states plus DC and Guam (45 jurisdictions) in 2026. You designate a State of Principal License (SPL) — which must be your primary residence or where at least 25% of your practice occurs — obtain a Letter of Qualification, then request full individual licenses in your target member states. Eligibility requires a full unrestricted license in an SPL-eligible member state, board certification, and a clean disciplinary history. Once qualified, a new license averages about 19 days, with roughly 51% issued within a week. Note the IMLC expedites verification but does not create one license — you still hold a separate license per state. (Hawaii and Vermont are member states but cannot serve as your SPL.) Budget the $700 IMLC application fee plus each state's own license fee, which varies by state.

CRNAs have no active multistate shortcut: the APRN Compact is not yet active as of 2026 (only 5 of the required 7 states have enacted it: DE, ND, SD, UT, WY), so CRNAs still need individual state licenses everywhere — varies by state.

Anesthesiologist Assistants (AAs) face the tightest constraint: they can be licensed or practice in only about 24 jurisdictions (22 states plus DC and Guam, several via delegatory authority such as KS, MI, PA, and TX), plus any VA facility in all 50 states, and always work under anesthesiologist supervision.

Choose a NALTO-member agency, and treat it like a vendor you are vetting — not a recruiter doing you a favor. NALTO (National Association of Locum Tenens Organizations) membership binds a firm to a published Code of Ethics, and NALTO provides an arbitration committee to settle disputes between member companies (note this arbitration is non-binding).

Vet a few before committing. Ask about years in business, peer references from clinicians in your specialty, communication responsiveness, who does the licensing and credentialing legwork, and — critically — rate transparency. A transparency-first marketplace like locu.ms exists precisely because pay and split visibility have historically been weak in this industry, so do not accept vague rate answers.

You are not limited to one agency. Many locums register with several, because each has different facility relationships and different open assignments. Working with multiple agencies widens your options and lets you compare offers directly, though you will want to track which agency submitted you to which facility to avoid duplicate submissions. The agency relationship also determines how malpractice coverage and tail are handled (Step 4), so factor that into who you sign with.

Credentialing is the facility verifying your license, training, work history, references, and malpractice history before you are allowed to work there — and you should expect 30-120 days per facility. It is separate from licensing: a state grants you a license, but each facility independently grants you privileges.

Because privileging is facility-specific, it repeats for every new assignment or hospital system. A busy locum may go through credentialing many times a year, which is why keeping your documents current pays off repeatedly rather than once.

The single biggest accelerator is your own responsiveness — provider responsiveness is consistently cited as a top factor in how fast credentialing closes. Practical speed levers: keep a current CV with no unexplained gaps, maintain an up-to-date CAQH profile, pre-warn your references so they reply quickly, and have clean digital copies of your diplomas, board certificates, and DEA registration ready to send. Start credentialing in parallel with licensing rather than after it — the two longest steps should run at the same time.

The single most important line in a locum contract is malpractice coverage — specifically whether you get an occurrence policy or a claims-made policy plus paid tail coverage. Get the answer in writing before you sign.

An occurrence policy covers any incident that happened during the policy period, forever, no matter when the claim is filed — so no tail is needed. A claims-made policy only covers claims filed while the policy is active; once it ends, you need a tail (an extended reporting endorsement) to stay covered for past work. Tail can cost 100-200% of the base premium, so the contract must state plainly who pays for tail. Many agencies cover it; if an agency will not commit in writing, treat that as a real cost you may have to absorb.

Beyond malpractice, review: the rate; hours, call, and shift expectations; cancellation and no-show clauses; travel and housing; expense reimbursement; and any non-compete or restrictive covenant. On non-competes, note the current legal landscape: there is no federal categorical ban. The FTC voted 3-1 on September 5, 2025 to accede to vacatur of its Non-Compete Rule and dropped its appeals, and it now pursues enforcement case by case. Enforceability is governed by the state where you work (California, for example, bans most non-competes) — varies by state. Have a healthcare attorney licensed in that state review anything restrictive.

Most locums are paid as 1099 independent contractors with nothing withheld, so before your first check you should set up estimated-tax payments, decide whether you need a business entity, and open a separate business bank account. The points below are a signpost — the dedicated tax, entity, and multi-state guides go deeper, and the figures here are compiled by the locu.ms editorial team from primary IRS and SSA sources, not tax advice.

Quarterly estimated taxes: pay using IRS Form 1040-ES. For the 2026 tax year the payments are due April 15, 2026, June 15, 2026, September 15, 2026, and January 15, 2027. A common rule of thumb is to set aside about 30-35% of income for taxes from day one.

Self-employment tax: 15.3% on net self-employment earnings — the 12.4% Social Security portion applies up to the 2026 Social Security wage base of $184,500, while the 2.9% Medicare portion has no cap.

Entity: you do not need an entity to start — you can work as a sole proprietor on a 1099. An LLC/PLLC with an S-corp election *can* reduce SE tax via reasonable-salary-versus-distribution splitting, but whether you can even form a PLLC, whether the state recognizes the S-corp election, and whether it charges a franchise tax all vary by state. A common myth is that the QBI / Section 199A deduction is a reason to form an entity — for most full-time locums it is not. Physicians (and clinicians generally) are a Specified Service Trade or Business (SSTB); under OBBBA (signed July 4, 2025) Section 199A is now permanent, and for 2026 the SSTB deduction fully phases out above roughly $276,750 single / $553,500 MFJ taxable income, so most full-time locums get $0 QBI. (OBBBA widened the 2026 phase-in range to $75,000 single / $150,000 MFJ above threshold amounts of about $201,750 single / $403,500 MFJ.) Do not form an entity expecting a QBI benefit.

Banking and retirement: open a separate business checking account plus a tax-reserve savings sub-account for the 30-35% you set aside — clean books matter regardless of entity. If you set up a solo 401(k), note the SECURE 2.0 rule that, starting with the 2026 tax year, age-50+ catch-up contributions must be made as Roth if your prior-year (2025) FICA wages exceeded $150,000; see the retirement guide for details.