How Negotiable is your Pay Rate

Reigen · Aug 20, 2012

This is just some general information. I hope it can help you

The amount of money a hospital pays to the agency is referred to as the Bill Rate. The agency will calculate and subtract their costs, overhead and profit margin from the bill rate and then, with the difference, make a detailed offer to the traveler. Offers should include the specific dates and location of the contract, details of pay, housing or stipend amounts, insurance or other benefits as the agency may choose to include in their offer package. Agencies' costs and profit margins vary widely. This will directly affect the amount of money available to package into an offer for the traveler.

Further, different agencies will package the same amount of money quite differently. One agency may offer luxury housing, high end health insurance, license reimbursement, a rental car and many other perks. Another may not offer health insurance, may provide low quality housing or even no housing at all. It is important to understand that there is no such thing as free housing or other free benefits. All of these things have a cost. Since all costs and compensation must come out of the bill rate, a traveler working for an agency offering a high level of "extras" will probably be paid lower wages than one working for an agency that offers few or no non-wage perks.

Salary averages are widely variable. Salary may change based on the location, the need of the hospital or nursing unit, the perceived staffing needs by the unit manager and the ability of the traveler to negotiate. Great differences are seen in various locations of the country. Generally, areas in the southern United States pay less than areas in the north or west. Areas where housing costs are high can impact salary ranges, as well. Travel nursing positions often can pay more than stationary nurse jobs depending on locations and demand.

There may be tax benefits, commonly called "Tax Advantage" or "Per Diem" pay, if the traveler maintains a "tax home" while working and living away from that home. The tax-free reimbursement covers meal and incidentals as well as lodging. Some companies only offer the tax free lodging component, while others provide both. A "tax home" is a dwelling that you live in, maintain and return to between assignments. You must have living expenses at your tax home that you duplicate because your business requires you to be away from that home.

Tax-free money is a complicated subject and many travel companies have little understanding of the tax implications for the traveler, often encouraging travelers who do not qualify to take it, leaving them at risk in an IRS audit. It is highly advisable to consult a travel tax expert prior to accepting tax free money.

NedRN · Aug 20, 2012

Quick answer to all your questions: It depends!

How negotiable is the rate your agency offers you?

Depends on the agency, your negotiating skills (which include talking to other agencies to get competitive offers), your personal marketability, the urgency of the position, how many traveler profiles the agency and the hospital have, and the general market conditions locally and nationally.

Which agencies pay the most?

There are 400 agencies and depending on the variables listed above, all could be the best paying on certain assignments for the right traveler at the right time. They all have different profit margins, and typically the larger the agency, the higher the overhead, and the higher gross profit they need to stay in business. Which means less for the traveler. Some agencies specialize in rapid response assignments (usually difficult assignments with more hours) and pay more. Some smaller agencies have very small gross profit margins and will pay more. Some agencies are better at negotiating higher bill rates and will pay more (but will only use higher quality travelers).

Which cities/states will you make the most?

Yes, geography matters. The northeast and the far west pays higher then the south and midwest typically. Union states pay more than non-union states. Large cities pay more than small cities. These are broad generalizations and there are plenty of examples that break them. There is a paradox in some large cities such as New York, Boston, and San Francisco. They pay more, but the housing costs are so extreme that you may actually take home less.

Which agencies offer the most incentives/bonuses?

You have to understand that everything a traveler gets paid comes out of a fixed pot. Some agencies offer longevity bonuses and completion bonuses, but these have to cut into the hourly pay or other compensation. It might "feel" better, but it is just rearranging your money. It is usually better to renegotiate this as part of your hourly. Your risks are lowered if the assignment cancels (you will have been paid more) and your overtime is higher.

There are sometimes "pass through bonuses" offered by the hospital because of special needs (their openings are not being filled for whatever reason). I've seen as high as $8,000 offered around 10 years ago and received several $5,000 bonuses myself. That is a significant boost to your three month pay. When the Arizona Hospital Association was price fixing hourly rates, pass through completion bonuses to bring traveler pay back up to a nationally competitive wage was the rule. This was not without risk. Failure to complete for any reason lost the bonus with the result that the traveler made below average wages for their time. A couple hospitals became notorious for terminating travelers in week 12 or 13 so as not to pay the bonus.

Anyway, that is not an agency benefit, and those large bonuses are gone. I've started to see a few small pass through bonuses again as the market recovers.