For most CFOs in healthcare, locum tenens spend exists in a frustrating paradox. Agency rates rise with demand. Travel and lodging costs fluctuate unpredictably. And every time a department head calls with an urgent staffing gap, saying no is not an option. Patient care cannot wait. So the agency gets the call, and another expensive shift gets filled at a 30 to 60 percent markup over what it would cost to use an internal clinician.

The traditional response has been to negotiate harder with agency partners or to cap bill rates. But as long as your organization has no credible alternative to agency labor, you have no leverage. Agencies know this. That is why locum rates have climbed steadily even as healthcare margins have compressed.

This article offers a different path. It makes the case that CFOs can gain lasting control over locum tenens spend by building an internal asset: a dedicated float pool of W-2 and 1099 clinicians who fill gaps at a fraction of the cost of agency labor. You will learn the hidden costs that most P&Ls miss, how to build a business case, how to operationalize a float pool without creating new inefficiencies, and how one health system saved more than $51 million by taking locums internal. 

By the end, you will have a practical roadmap for turning locum tenens from a chronic budget headache into a source of predictable, sustainable margin improvement. Let’s get started. 

The Hidden Costs of Locum Tenens

The true cost of relying on temporary staffing runs deep, and often silently erodes margin, productivity, and permanent staff retention. CFOs who only track the bill rate miss the iceberg below the surface.

Start with the direct but often underestimated costs. Agency markups of 20 to 50 percent above the clinician’s pay rate are common, and in high-demand specialties such as anesthesiology or psychiatry, markups can exceed 70 percent. Beyond the bill rate, each locum assignment can include flights, rental cars, and lodging, adding as much as $2,000-$4,000 per week in travel and lodging expenses. 

Frequent handoffs between rotating locums increase the risk of communication failures, duplicate orders, and longer lengths of stay. If you have not run a fully loaded cost analysis of your locum spend that includes agency fees, travel and housing, operational friction, and turnover impact, you are likely underestimating true cost by 40 to 60 percent. That gap is the financial rationale for an alternative model.

What Is an Internal Float Pool?

An internal float pool is a dedicated workforce of clinicians who fill scheduled and unplanned gaps across your system at a fraction of the cost of agency labor. Instead of being assigned to a single department or site, these clinicians float across the organization to cover planned leaves such as vacations or parental leave, unexpected absences from sick calls or turnover gaps, and seasonal or census-driven surges. 

A well-designed float pool often includes a combination of employed (W2) and independent contract (1099) providers, allowing organizations to align coverage strategies with both operational and financial goals. W2 providers can offer consistency, cultural alignment, and long-term workforce stability, while 1099 providers provide flexible, scalable coverage that can help address fluctuations in demand, seasonal volume changes, leave coverage, or hard-to-fill shifts without permanently increasing fixed labor costs.

Building the Business Case for Internal Locums

Many CFOs assume that adding employed float clinicians will simply shift costs from one column to another without delivering real savings. But when you compare the fully loaded cost of an agency locum against that of an internal float clinician, the math quickly favors the internal model.

Start with the direct cost-per-day comparison. For example, you might be paying a locums Anesthesiologist at a rate of $489/hour, but you could fill that same shift with someone from your float pool for closer to $330/hour. Doing so saves you 32% or $159/hour. But the business case does not stop there.

Three additional financial drivers make the internal float pool even more attractive. First, you reduce or eliminate travel and lodging spend entirely by hiring float clinicians from within your local or regional market. 

Third, you decrease turnover among permanent clinicians by reducing the excessive weekend, holiday, and on-call burden that drives burnout.

Case Study

UPMC, one of the largest health systems in the United States, faced a familiar challenge: locum tenens spend had grown into a massive, difficult-to-control expense. Their solution was not simply to negotiate harder with agencies or to cap rates. Instead, UPMC fundamentally changed how they sourced temporary clinical labor by combining a vendor-neutral managed service provider (MSP) and an internal float pool. 

UPMC partnered with Syncx to take locums internal in two distinct but related ways. First, they implemented a vendor-neutral MSP model, which allowed for more locums agencies to compete for their business, bringing costs down and only requiring one single point of contact from Syncx instead of managing a bunch of different locums agency relationships. Second, UPMC worked with Syncx to build and scale an internal float pool that captured even more of the value that would otherwise flow to external agencies. By transitioning 100 percent of their locums and float pool spend to Syncx, UPMC eliminated fragmentation and gained full visibility into every temporary staffing dollar.

The financial outcomes are striking. Across the program, UPMC achieved more than 

$51 million in total cost savings over the last four years, with 18 million of that occurring in 2025 alone. A key driver of those savings was the use of market rate data combined with standardized rates across the entire UPMC system. That data-driven rate setting delivered a consistent 6 percent advantage. Taken together, these moves transformed locum tenens from a cost center that seemed impossible to control into a source of nine-figure cumulative savings.

Get a Personalized Float Pool Demo

You now have the framework: the hidden costs of locum tenens, the definition and financial logic of an internal float pool, the business case, the operational playbook, the risks, and a real-world case study showing $51 million in savings. 

But every health system is different. Your mix of specialties, your geographic footprint, your existing agency relationships, and your internal political landscape all shape what a successful float pool looks like for you.

That is where Syncx comes in. Syncx helps CFOs and health system leaders move beyond theory and into execution. Whether you are starting from scratch with no float pool today or you have an underutilized pool that is not delivering the savings you expected, Syncx provides the strategic guidance, technology, market rate data, and the vendor-neutral MSP model to make it work. UPMC trusted Syncx to transition 100 percent of their locums and float pool spend, achieving $18 million in savings in 2025 alone.

The only way to gain control of locum tenens spend is to build a credible alternative. That work starts with a conversation. Reach out to us today for a free, personalized demo.