Agency Owner Facts Sheet

Nature of the business

The company provides temporary nursing staff for healthcare facilities. It is usually operated out of a physical office, not a home office. The office is open during normal business hours and someone is on-call 24/7.

A temporary staffing service with 10 nurses working regularly is a multi-million dollar business. Persistence, hard work, and diligence are needed to start and grow a multi-million dollar business. Nurses have all these qualities. The association offers a one-hour audio CD to answer your basic questions. A checklist of what to do to get started is included. Click here for CD details and/or to purchase the CD.

The bill rate (billed to the hospital) and the pay rate (paid to the nurse) in most areas is between 15 and 20%.

To keep up-to-date with the medical staffing industry, read the blog on PRN Funding's website at http://prnfunding.com/blog.

Startup costs

Nursing agency startup costs are a minimum of $80,000 up to $100,000. The additional startup cost accounts for hiring an office staff and launching an effective advertising campaign. Those who are successful with the smaller investment tend to be nurses who are willing to do the work themselves, spend a lot of their personal time, and build the agency slowly. A funding base of $200,000 and up is needed to meet payroll while waiting for payment from the facilities. Funding is available from factoring and funding companies.

The Internal Revenue Service (IRS) requires that personal and business expenses and equipment be held separately. Personal computers, software, printers, and other equipment and supplies used by the company can be purchased by the company from you. You can loan your company startup funds to purchase these items or rent them to your company. No personal business should be done on company computers or equipment.

Industry future

The future for this industry is good based on the shortage of nurses and the continuing increased demand for nurses forecasted in the future.

Earnings

Earnings are unlimited and are based on the number of employees working in facilities under contract. Agencies quickly move into multi-million dollar earnings. Typically an agency gains the interest of an acquiring agency in one and one-half years and is worth from 1.2 to 3.2 million dollars.

Education

The owner and operator of a temporary help service does not have to be a nurse or have any special nursing education. Some states require that a registered nurse work for the company either as an employee or consultant.

Business education is needed for nurses to understand the business aspects of being self-employed or a small business owner. The association provides this education customized for nurses. College and community business courses do not understand the nursing community. Advanced nursing courses do not teach self-employment and small business ventures.

The NNBA provides this education in various ways to make it convenient and affordable for you.

Books: Self-Employed RN: Choices, Business Aspects, and Marketing Strategies - See details and/or purchase
Audio CDs:Topics to organize, improve and market your venture, and increase your profit - See details and/or purchase
Business plan: A business plan template on a CD (Word® document) to help you write your personalized business plan. Template items are correlated with the information in Self-Employed RN. See details and/or purchase business plan.
Contracts:Independent contractors' and consultants' contracts on CD as a Word® document. Designed for your legal counsel to individualize. See details and/or purchase contracts.
Home study:Courses on the business aspects of self-employment and how to write a book - See details and/or purchase
Unlimited personal assistance: NNBA member benefits include unlimited personal assistance. - See details and/or join

Business terminology

In the United States, Mexico, and Canada, the North American Industry Classification System (NAICS) provides an official industry classification system with numeric codes. These codes provide a method to collect data and to identify companies for state and federal regulation and taxation. The proper industry classification for nurse staffing agencies is a temporary help service. Proper classification is important to your business’ future.

Business legal structure

The legal structure for a temporary help service is usually a corporation affording the most tax deductions and liability protection. The corporation is an independent legal entity separate from its owners. The owner is not liable for the debts or judgments incurred by the corporation, and personal assets are not at risk.

Little known facts

Nurses working for temporary help services are usually designated as employees. Some agencies hire independent contractors. The agency, the healthcare facilities, the nurse, or the contract between the nurse and the agency are not the final word on worker status for tax purposes; the IRS has the final word on worker status for tax purposes. You may be responsible for back employee taxes and penalties if the IRS determines that the nurse (worker) is employee status and not independent contractor status.

Certification is available through JACHO and is optional.

If you have questions about starting a temporary help service (nursing agency) contact Pat Bemis, RN CEN, president NNBA. Contact by email. Phone (321) 633-4610.