Using a Behavioral Health Staffing Agency or Recruiter: Models and Fees

Three different businesses get sold as "behavioral health staffing," and the differences that matter are who employs the clinician and when you owe money.

A direct-hire recruiter — contingency or retained — sources candidates for a job on your payroll.

The recruiter never employs the clinician; the fee is for the placement.

A staffing or temp agency is an employer.

It hires the clinician, pays them, and assigns them to your site while invoicing you.

The legal definition of "temp" is broader than the word suggests: OSHA defines temporary workers as workers supplied to a host employer and paid by a staffing agency, whether or not the job is actually temporary — a clinician covering a year-long leave counts.

Locum tenens is the physician version of bought coverage: a substitute physician covers for the regular physician, and Medicare has a distinct billing route for a substitute's services, covered below.

Choosing between them starts with your own funnel.

If a role can wait for the right person and your postings are producing interviews, you may not need to buy recruiting capacity at all — our rundown of the best sites to post behavioral health jobs covers the direct route, and our guide to recruiting therapists covers building the pipeline yourself.

Agencies earn their fee when you need speed your process cannot produce, coverage you cannot staff, or a search that has already outlasted your posting.

Start with what our research did not find: we found no primary or neutral source — no government agency, no researcher — that publishes standard behavioral health recruiter or staffing-agency fee percentages.

The percentage figures that circulate online come from vendor material, not from a data source.

So this page describes the fee models in words only; the numbers come from the written quotes you put side by side.

Contingency recruitment.

The firm is paid only if its candidate is hired.

The contract — not the sales call — decides what "hired" means for the fee: earned at acceptance or at the start date, invoiced when, and what happens if the hire leaves during the guarantee period.

Retained search.

The firm is engaged for the search itself and paid in stages whether or not the search ends in a hire.

It exists because some searches need dedicated capacity — a clinical director role open for months is work you want someone actively doing, not work done between other clients.

Temp and contract staffing.

The agency pays the clinician and bills you a rate for the hours the clinician works.

The difference between that rate and the clinician's pay is the agency's margin — ask whether the invoice itemizes it, because it is the number you actually negotiate.

Guarantees.

A guarantee is a contract term, not a given.

If one is offered, ask whether it is a free replacement or a refund, how long the window runs, and what voids it — read the exclusions closely for resignations, terminations for cause, layoffs and counteroffers.

What the fee buys.

A recruiter sells reach into a candidate pool your own postings may not be touching.

A temp agency's markup buys the employment relationship handled — the agency employs and pays the clinician — and with it the ability to end an assignment without terminating one of your own employees.

What both models sell is speed and risk-shifting, so judge the fee against the cost of the role staying open.

Temp-to-hire is the bridge model: the clinician starts as the agency's employee, working at your site, and if you decide they belong on your payroll you convert them to a direct hire by paying a conversion fee.

It is the closest thing staffing offers to a working audition: you see the clinician's real output, documentation and fit before either side commits.

How the conversion is priced is a contract question: the agreement sets the fee, when it can be exercised, and whether the amount changes with the time the clinician has already served on the assignment — which is why the number belongs in the contract you read, not in a rate card.

Ask three things before signing: when the conversion option opens, what the fee is, and whether hours already worked are credited against it.

Two cautions.

First, run the comparison honestly: the cost of a temp-to-hire is the agency's markup on every hour of the temp period plus the conversion fee, and the alternative is not free — it is the vacancy you would still be covering.

Second, do not use the temp label to try on an employment relationship without its obligations: the joint-employer coverage below turns on the working arrangement — for anti-discrimination law, on who has the right to control the worker — not on what the contract calls the worker.

When an agency clinician works at your site, two organizations make employer decisions: the agency employs them, and you direct their day.

Federal guidance takes that split seriously.

Workplace safety — OSHA.

OSHA treats a staffing agency and its client (the host employer) as joint employers of temporary workers, so both are responsible for providing and maintaining a safe work environment.

OSHA recommends that the two parties set out their respective responsibilities for compliance with OSHA standards in their contract.

For a clinic that means writing down who delivers safety training, who fixes a hazard, and who handles injury reporting and recordkeeping.

Anti-discrimination law — EEOC.

Under EEOC's 1997 enforcement guidance, if both the staffing firm and its client have the right to control the worker and each has the statutory minimum number of employees, both are covered by federal anti-discrimination law as joint employers.

The guidance assigns duties to each side: the client must treat the assigned worker without discrimination, and the staffing firm must take immediate and appropriate corrective action if it learns the client has discriminated against one of its workers.

You cannot route a discriminatory preference through an agency: EEOC's example is a staffing firm that agrees to refer only white nurses at a client's request — the firm violates Title VII both as an employment agency and as an employer.

The practical intake rule: ask the agency for a license, a credential or a language skill, not for "someone our clients will be comfortable with" — EEOC guidance warns that hiring or assignment based on real or perceived customer or coworker preferences can improperly screen out people by national origin.

Wage and hour — the FLSA.

The Department of Labor has had no regulation on joint-employer status under the FLSA since 2021, when it rescinded its 2020 rule — the rescission was published July 30, 2021 and took effect October 5, 2021.

A new rule covering the FLSA and FMLA was proposed on April 23, 2026; as of October 7, 2026 no final rule had been published, so it remains a proposal only.

The practical effect: the federal test for when two organizations share FLSA obligations is not settled by a current regulation — a good reason to have employment counsel review the staffing agreement, and to check what your own state's law adds.

Day to day, co-employment is a coordination problem: agency clinicians sit in your schedule and follow your clinical protocols, so supervision, discipline, safety and scheduling need named owners in the contract.

The staffing contract decides what you pay the agency.

It does not decide who may bill a payer for the clinician's services — enrollment and billing rules do.

Medicare.

Outside the locum exception, Medicare may pay a clinician's employer, or an enrolled entity that bills under a contractual arrangement with the clinician, instead of paying the clinician — the reassignment rules at 42 CFR 424.80(b)(1)-(2).

Three consequences matter when the clinician is the agency's:

• Joint overpayment liability. When an enrolled entity bills Medicare for a contracted clinician's services under reassignment, the entity and the clinician are jointly and severally responsible for any Medicare overpayment. An agency placement does not insulate your practice from billing errors — audit the claims as if the clinician were your employee.
• The clinician sees the claims. A clinician who reassigns payment keeps unrestricted access to the claims the entity submits for their services, whether they are an employee or a contractor. Tell agency clinicians how your billing works, and expect them to be able to look.
• Locum billing is its own route. For a group to bill a substitute physician's services under the regular physician's name, the substitute must not have reassigned Medicare payment to the group — a reassignment flips the billing route. Physician locum rules are their own subject; confirm the specifics with your billing team before covering physician gaps with agency staff.

Medicaid and commercial payers.

We cannot point you to a rule that settles this: whether a state Medicaid program or a commercial plan pays for services delivered by an agency-employed clinician is an open question in our research, and the answer is whatever each program's or plan's own rules say.

Ask each payer, in writing, before the first billable session: are services by an agency-employed clinician covered, under what enrollment arrangement, and with what documentation?

Our guide to credentialing a new clinician with payers covers the enrollment ramp for direct hires, and our guide to Medicaid enrollment for new behavioral health hires covers the state-program side.

Who submits the claims.

Some arrangements leave billing with your practice; others bundle it into the agency's service.

Either way the rules above follow the entity that submits the claims — so "who bills, under whose enrollment, and who absorbs an overpayment" belongs in the contract.

Every model above collapses into contract terms.

Before you sign, get written answers to:

• Who is the employer of record? Whose payroll, payroll taxes, workers' compensation and benefits is the clinician on? If the answer is vague, every other protection in this guide is on sand.
• What exactly earns the fee? Is the fee owed at acceptance or the start date, when is it invoiced, and what is owed if the hire leaves during the guarantee — a replacement or a refund?
• What is the conversion fee and when can it be exercised? Ask whether it steps down with the assignment's length and whether temp hours credit against it.
• Who owns each safety duty? Training, hazard correction, injury reporting and recordkeeping. OSHA recommends the contract set out each party's responsibilities — read that allocation before signing, not after an incident.
• Who verifies the clinician's license and credentials? Verify at the primary source yourself rather than accepting the agency's file; our guide to license verification, exclusion checks and background screening covers what to check and in what order.
• Who bills, and under whose enrollment? Settle whether your entity bills under a reassignment from the clinician (and on what basis: employment or a contractual arrangement), who carries overpayment liability, and whether your Medicaid and commercial contracts cover agency-employed clinicians at all.
• Who carries malpractice coverage? Whose policy covers the assigned clinician at your site, at what limits, and does it require anything of you? Our guide to malpractice insurance for employed clinicians covers the direct-hire side of that question.
• How would you screen out an applicant I do not want? Listen for "fit with your patients or team" framing: the safe version is criteria-based — license, credential, language, availability — and the version EEOC's guidance warns about is preference-based, with you as the client asking for it.

One last framing: an agency is one lever among several.

If you are mapping the whole hiring sequence — role definition, posting, screening, pay, contracts, onboarding — start from the behavioral health hiring hub.

Buying recruiting capacity is a fix for a specific gap, not a substitute for the rest of the system.