Medical Staffing Agency Licensing

Medical staffing agencies are licensed at the state level and it is crucial for them to operate within applicable state laws. Here’s what you need to know about the licensing and renewal requirements for each state.

What Are Medical Staffing Agencies?

A medical staffing agency is a business that procures employment for individuals in the healthcare field. These companies help healthcare organizations fill permanent and temporary roles across a variety of medical specialties, including the following:

• Certified Medical Technicians (CMTs)
• Certified Nursing Assistants (CNAs)
• Certified Registered Nurse Anesthetists (CRNAs)
• Emergency Medical Technicians (EMTs)
• Licensed Practical Nurses (LPNs)
• Radiology Technologists (RTs)
• Registered Nurses (RNs)
• Respiratory Therapist (RRTs)

Firms need to obtain the appropriate business license from your state's Department of Labor, Department of Health and Human Services, or Secretary of State. Failure to do so can result in the closing of your business.

How to Start a Medical Staffing Agency

If you have worked in the medical field for some time and are looking to open your own medical staffing agency, it is vital to prepare yourself for the application process and to run a business.

Medical staffing agencies are growing in popularity for healthcare professionals, as the income is often higher and schedules are more flexible. There is also the ability for employees to showcase a variety of specialized field experiences. While you may not have any difficulty recruiting applicants to your agency, you need to verify you are in compliance with state laws before hiring anyone.

Legal Business Structure

The business structure you choose for your staffing agency will affect your personal liability, how your business makes the money it needs to operate, the paperwork you have to file, and what will be owed in taxes. Two of the most common entity structure for healthcare staffing agencies include the following:

• Limited Liability Companies (LLC). An LLC protects an owner’s personal assets from business liability in the event of a lawsuit for financial difficulties. In terms of taxation, profits and losses can be passed through to personal income. This means the owner will likely need to pay self-employment taxes.
• Corporations. As a corporation, a business is a separate legal entity from the owners. The company is responsible for its own debts and taxes. In the event of a lawsuit, individual liability is limited.

Choosing a structure ultimately comes down to deciding what is best for your business in terms of taxes, industry, and personal liability.

State Business Registration

Once you have decided on the right business structure for your staffing agency, it is time to get your business registered in the state in which you plan to operate. Brush up on local requirements for registration, or contact the office of your secretary of state or county clerk. Once you file your articles of incorporation, you will pay any required registration fees. You will also need to appoint a registered agent to receive notice of lawsuit and other legal or government notices.

You can also seek guidance from the healthcare and pharmaceutical licensing experts at Harbor Compliance. We are available to examine the status of your company’s licenses and ensure you are complying with state and local regulations. Our software ties directly to states’ secretary of states’ databases, so you can remain up-to-date with requirements.

Agency Licensure

In addition to business registration, general staffing agencies looking to employ individuals in the healthcare industry need to secure additional licensing. State guidelines vary, so it is important to be aware of what your state requires.

In addition to applying for a medical or nurse staffing license, you may need to provide a statement highlighting your professional experience and how it qualifies you to run a staffing agency. It is also common to be asked to supply a list of inventory skills and clinical competence, as well as a policy for hiring. All of this information should be gathered prior to applying for the applicable licenses.

Business Insurance Policies

Medical staffing agencies face unique liability conditions, as many of the individuals they hire are contractors. In order avoid legal action and protect business assets, medical staffing agencies should consider the following types of coverage:

• General liability. Protects agencies from onsite property damage and physical injuries occurring at the medical facility and agency office.
• Medical professional liability. Medical professionals working for healthcare staffing agencies could face malpractice claims. Medical professional liability insurance protects the agency in the event an employee is sued.
• Workers’ compensation. Workplace injuries are common in the healthcare field. Workers’ compensation coverage protects injured employees in the event of an accident. The employee has the right to financial benefits for qualified injuries, so long as they relinquish their right to sue the agency for workplace accidents.
• Fidelity bonds. Protect agencies against the costs of theft and subsequent legal actions. They are a crucial aspect of a staffing agency’s insurance policy.
• Surety bonds. Adds a layer of protection against unexpected situations. Bonds are contracts between three parties: principal, obligee, and surety. The principal is the individual or company blamed for the loss, while the obligee is the entity that collects the bond when the principal causes a loss. The surety pays for the loss.

Renewing a Medical Staffing Agency License

In terms of license renewal, requirements also vary by state. Some states require annual renewals, while others require renewals on a biennial basis. In most instances, agencies receive renewal notice at least 90 days prior to expiration. Submitting a renewal request as soon as possible is important to ensure business operations are not interrupted.

Explore Licensing by State

Click on a link below to view licensing information in your state.

Meeting the medical staffing agency license requirements is not always an easy process. Fortunately, Harbor Compliance License Manager helps healthcare professionals maintain their licenses by automating repetitive tasks like tracking renewals. Through License Manager, you can also access reference data for the states in which you work, reducing the time spent researching state requirements. Contact our licensing experts today to learn more.