By Michelle Sanchez-Bickley, SVP of Customer Success at Hallmark
This is the second of a three-part series on reforming the locum tenens industry. In Part 1, Anthony D’Eredita identified the industry’s biggest challenges. Today, I will describe why centralization is key to overcoming these challenges. Part three will close out the series with a practical guide to organizational readiness.
The locum tenens market is at an inflection point. With 88% of health systems concerned about rising costs, expenses increasing at nearly twice the rate of inflation, and a projected shortage of 100,000 providers by 2028, the stakes have never been higher. Yet fewer than 30% of organizations use vendor management systems to bring structure and control to a $10 billion market.
By covering vacancies, seasonal demand, and hard-to-recruit specialties, locum tenens remains essential to maintaining access to care. But in many health systems, locums engagement is fragmented. Departments contract independently, rates vary widely, spend visibility is limited, and compliance standards differ by site.
In my role as SVP of Customer Success at Hallmark, I work with organizations that are addressing these challenges by centralizing locum tenens through a vendor management system (VMS). When done right, centralization can reshape how health systems think about workforce strategy, vendor oversight, and accountability. I also see it as key to overcoming the industry challenges we identified in Part 1 of this blog series: accelerating time to value, improving transparency, and identifying credible performance metrics.
Centralization Means Quicker Value
When it takes too long to fill a vacancy, all parties lose out. By creating a single source of truth for position data and provider information, an effective VMS removes the bottlenecks and friction points slowing the system down.
The standardized requisition data maintained by a VMS allows agencies to clearly understand requirements upfront, while APIs enable that information to flow cleanly and consistently between systems. A universal credentialing wallet centralizes ownership and validation of provider credentials, paired with centralized verification on the health system side to streamline onboarding and support MSOs and CVOs. And by centralizing provider application data, technology can auto-populate fields across platforms, saving time, improving accuracy, and accelerating placement.
Centralization Means Mutual Transparency
The very same fragmentation that slows down vacancy fills also makes it difficult for health systems, providers, and agencies to determine appropriate costs and fees. The transparency unlocked by a VMS makes “apples-to-apples” comparisons possible across geographies and urgencies.
A VMS can generate these comparisons using a rate predictor that guides buyers on market-appropriate ranges, while leveraging employed-physician fair-market-value (FMV) data by specialty and region to gauge locum rate premiums. These become the shared benchmarks that serve as the foundation of transparent negotiations between health systems and agencies. And those conversations should be ongoing, involving both regular business reviews where health systems and agencies can align on data, insights, and shared priorities, and real-time agency ranking processes so agencies can augment processes to ensure better results in real time.
Centralization Means Consensus Generation
Provider rates and FMV data are not the only metrics worth tracking. Once any locums transaction is settled, health systems still have a right to know how their locum providers perform relative to full-time staff. Agencies and the locums providers themselves also want more credit for better outcomes. Centralization through a VMS allows all parties to track these performance metrics systematically.
For example, a VMS can dynamically incorporate publicly available data (e.g., Google ratings, NPI) into candidate profiles. It can also track and report insights on provider performance using metrics such as health system candidate ratings, reliability, cost/RVU efficiency, and other data. Or, for a different approach, it can tier agencies based on quality indicators such as provider performance, credentialing success rates, and other data-driven measures.
Looking Ahead
Centralizing locum tenens through a VMS is not a cure-all, but when done well, it transforms locums from a reactive expense into a strategic workforce lever. In an era of physician shortages and financial pressure, health systems need visibility, control, and flexibility. Centralized locums management provides all three, while supporting consistent, high-quality patient care.
While I can make the case that any organization would benefit from moving to a centralized VMS, the first step toward organizational change should always be self-assessment. If you want to measure the quality of your organization’s locum tenens processes, stay tuned for Fixing Locum Tenens, Part 3: Readiness.
Click here to read Fixing Locum Tenens, Part 1: The Challenges.