Staffing platform Nomad Health expanded its online platform for freelance medical work into two more states Wednesday, adding California and Texas to the mix.
The New York City-based startup is an alternative to the broker system often used by clinicians seeking freelance work, serving as a digital and "frictionless" platform for temporary clinicians and the hospitals and clinics that hire them.
The recent two-state launch—which brings Nomad Health's total coverage to 14 states—is a step toward addressing the doctor shortage in the U.S., said Nomad Health CEO Dr. Alexi Nazem, particularly in places such as California and Texas, where temporary doctors are in high demand. In Texas, for instance, 35 counties have no practicing doctors.
Overall, the U.S. will have a shortage of between 40,800 and 104,900 physicians by 2030, according to the Association of American Medical Colleges.
Temporary doctors are a way for hospitals to meet patient demand amidst a growing physician shortage, which is exacerbated by physician turnover. The use of locum tenens is on the rise; 94% of healthcare facilities used temporary physician staff in 2016, up from 74% in 2012 according to a survey by Staff Care.
Nomad Health's digital approach to locum tenens fits right in with gig economy models popular in other sectors, such as hotels and taxis.
"We're drafting off the same trend," Nazem said. "Just like the Airbnb hosts and Uber drivers, doctors and nurses are interested in having flexible freelance work."
Also like Uber, Airbnb and others, Nomad Health does away with the middleman—or at least becomes a new kind of middleman by replacing the brokers who often are the connection between providers and the health systems seeking their work. "The third-party broker system is unbelievably broken," Nazem said. "It's mostly paper, and it's very expensive."
Nomad Health charges a 15% commission to link up a provider with a healthcare facility—a rate the company says is much lower than traditional brokers' fees.
Financing for the rollout of Nomad Health's platform comes in part from funding the company raised last year in a series A financing round led by First Round Capital and RRE Ventures. The company plans to continue expanding, and Nazem hopes to be in every state within the next year or so.