How to Start a Medical Staffing Agency

several healthcare workers lined up in a row with their arms crossed

Last Updated January 11, 2024

By 2030, 21% of America’s population will be aged 65 and older. While this is not inherently cause for alarm, it does signal a rise in demand for healthcare and caregiving aids, meaning there’s no better time to start a healthcare staffing agency.

This is evidenced by the fact that the U.S. will need to recruit about 2.3 million additional medical professionals to take care of its aging population. Healthcare staffing agencies may be the only way the country can keep up with the increasing demand for healthcare professionals. Experts predict this to come to fruition, as the current healthcare staffing market size ($23.6 billion) is expected to grow by 5.6% from 2023-2030.

From nurse and CNA staffing to medical billing professionals, healthcare staffing agencies are increasingly in demand. If you’re willing and able to supply healthcare workers to hospitals and medical offices, starting a healthcare staffing agency may be for you – and it can prove a lucrative venture. A healthcare staffing agency might have a low barrier to entry, but you still need the right information to start and grow your staffing agency. This article covers the details of everything you need to know to start your healthcare staffing company.

How to Start a Healthcare Staffing Agency

Starting a medical staffing agency may seem daunting, but it is a relatively straightforward process. Once you follow the steps outlined below, you can consider yourself a healthcare staffing agency owner!

1. Choose a Specialty/Niche

There are different niches and specialties in the medical field, and this translates to the healthcare staffing industry as well. It is usually easier to specialize in one area of medical staffing when first starting out and incorporate more niches as your agency grows. For example, some agencies staff only essential healthcare providers, such as nurses and physicians, while others focus on providing allied medical professional staffing services, like anesthesiologists or sonographers. It is not recommended to start as a generalist as this can hinder you from landing clients quickly or cause you to earn lower incomes.

If you’re a healthcare professional looking to start a staffing business, it is best to choose a niche where you have the most experience. Not only will you be able to highlight your own industry expertise to land clients, but you can independently contract yourself.

2. Outline Your Service Offerings and Set Pricing

To be able to supply a successful pool of candidates, you need to outline your offerings and set pricing. Your service offerings should articulate details, such as whether you’ll be providing full-time or contract options, or both. It is also important to ensure your pricing covers payroll, insurance, taxes, business logistics, and any other miscellaneous expenses you face. A markup of 30-50% should take care of these expenses but be sure to run the numbers yourself and customize your services and pricing accordingly.

3. Register Your Business

To operate any kind of business, you need to register it as an entity. Before you proceed with registrations, decide if you want to operate as a sole proprietor, an LLC, a partnership, or a corporation. Then, check in with your local laws to find out what documents and government requirements apply to your region. Different laws exist for different states, so researching your state-specific requirements will ensure you properly register your business in your region. Once you’ve registered your business, be sure to keep your documents handy and make note of your Employer Identification Number (EIN), as you will likely need this when filling out other business forms.

4. Open a Business Bank Account

After you’ve registered your healthcare staffing business with the federal government and any required state agencies, the next step is to open a bank account for business transactions. This will help you track and analyze business income and expenditures as you grow your staffing agency and always know when you’re running at a loss or profit. When considering which business checking account to get, consider the following:

  • Minimum opening deposit
  • Monthly fees
  • Interest
  • Transaction limits
  • Customer support
  • Additional perks, like sign up bonuses and cash back

Note that when applying for this business bank account, you should use your business name and not your personal name.

5. Create a Unique, Attractive Brand

Running a business requires you to be professional, and that includes your branding and social media aesthetics. Prospective clients will likely search for your business online, and you need your digital identity to accurately reflect your business reputation, values, and client offerings. So, a user-friendly website is an investment you should make. Details such as graphic designs, page layout, imagery, and color palette will impact how potential customers perceive your business, so be sure to spend time making your site as professional as possible. You can choose to customize the website yourself with options like Wix or WordPress, or you can hire web design and branding experts to support the development of your digital identity.

Related: How to Create a Marketing Strategy for Your Staffing Agency

6. Determine Your Payment Process

To eliminate payment hurdles, you need to determine how you will receive invoice payments from customers. You can set up payment accounts like PayPal, Square, or Stripe and integrate them into your website to accept payments online, or you can plan to have clients mail checks or send ACH transfers to pay their invoices. Additionally, there are several staffing-specific software products that are available that often include billing and payment solutions, such as Akken Cloud and Avionté. The main takeaway here is just to make sure you have a billing solution in place so that you are prepared once you land your first client.

7. Create a Client Base

A business cannot exist without clients, and to find clients for your staffing agency, you’ll need to put your interpersonal skills to work by reaching out to healthcare managers and executives who hire medical professionals and offer your service. Because of the vast opportunities in this field, it is fairly easy to get your first clients with this proactive approach. Consistent outreach will land you your first clients, and you can go ahead to staff them.

8. Recruit Candidates

You can find healthcare candidates on platforms like LinkedIn, via word of mouth, on job boards like Indeed, and at healthcare events and conferences. After you’ve compiled a list of candidates, you can screen them and interview suitable matches before sending them to work at your clients’ medical practices.

Pros and Cons of Starting a Healthcare Staffing Agency

As with any business, there are both benefits and downsides to starting a healthcare staffing company. Below we outline some of the most impactful pros and cons:

Pros Cons
Helping grant people access to healthcare Specific, technical roles can be difficult to fill
Helping combat the national healthcare shortage gap Healthcare professionals can be expensive to staff
Increased job flexibility that comes with running a business Can be difficult to grow clientele when first starting
Can be a lucrative industry Obtaining accreditation and licensing can be challenging


  • By starting a healthcare staffing agency, you improve access to healthcare for individuals, especially in rural areas hit by medical staffing shortages.
  • A healthcare staffing agency helps to fill the shortage gap in health professions as agencies can go as far as recruiting outside the state, region, or country to fill these gaps since institutions within the region may not be producing enough professionals.
  • Owning a healthcare staffing agency means greater flexibility! Whether you are looking to work from home or choose your own hours, owning your own agency gives you the ability to do so.
  • Because the healthcare staffing market is more than $20 billion (and growing!), there’s quite a bit of money to be made.


  • You may face accreditation and licensing issues, especially when placing out-of-state professionals.
  • Staffing medical roles can be challenging because of the technicality required for specific roles.
  • Healthcare professionals are more expensive to staff as the healthcare field offers competitive pay, meaning it will cost more upfront to hire your workers.
  • It can be difficult to grow your clientele when you are first starting out.

Staffing Agency Financing: How to Raise Funds for Your Business

Even if you follow every necessary step when starting a healthcare staffing agency, you might still find yourself faced with a significant hurdle before you’re able to launch operations: financing your startup business.

Staffing agency financing can be difficult for first-time business owners, as a lack of business credit history can prevent you from qualifying for traditional bank loans. Thankfully, there are ways to raise funds for your business without a loan, many options of which are classified as “alternative lending.

If you’re confident you can achieve these steps to kickstart your healthcare staffing agency but you’re still contemplating how to finance your company, here are a few options you should consider:

  • Crowdfunding: Raising funds from individual investors using internet-based platforms by exchanging equity for investment
  • Grants: Funds from the government, corporations, or foundations to boost the growth of your business. Examples include research grants, minority entrepreneur grants, women-owned businesses, and rewards for various innovations.
  • Invoice Factoring: The process of selling your outstanding accounts receivable to a third-party factoring company in exchange for being advanced up to 80-90% of the value of each invoice within 24 hours. This helps improve your cash flow and provides consistent, immediate working capital boosts.
  • Business Line of Credit: Works like a credit card to help cover ongoing expenses, with no collateral required. However, borrowing limits are dependent on your credit score.
  • Private Investors: Find investors with an interest in your staffing agency. These investors provide funds and can offer regular advice, although you will typically have to exchange part of your business ownership.
  • Traditional Bank Loan: Any standard bank loan that assists entrepreneurs with business growth and expansion. However, as a new business owner, these loans may be difficult to qualify for given minimum business credit score requirements.

How Invoice Factoring Can Help

Invoice factoring is one of the most common financing avenues that healthcare staffing agency owners choose to explore.

If you’re starting a medical staffing agency, it’s important to keep two financial metrics at the top of your list of priorities: cash flow and working capital.

Factoring helps business owners improve both of these measures. Once you sign an agreement with a factoring company, they then take control of your accounts receivable collection responsibilities. This means that your customer will submit payment to the factoring company rather than your business.

Once you invoice your customer, the factoring company advances 80-90% of the value of each invoice to your business within 24 hours. Therefore, you no longer have to worry about slow-paying customers or long payment terms affecting your cash flow. Instead, you have a reliable, steady stream of working capital. Once your customer submits payment to the factoring company, the remaining value of the invoice is released to your staffing agency, minus a small factoring fee.

If you have any questions about invoice factoring, how it works, and whether your business is a good fit, feel free to fill out our online factoring quote form or give us a call at (205) 607-0811. We at altLINE have factored over $1 billion in invoices throughout our 88 years of serving clients, and we take pride in helping our customers achieve their business growth goals.


How do medical staffing agencies make money?

Medical staffing agencies make money by charging fees to recruit and supply medical professionals and allied healthcare professionals to healthcare establishments. One of the most common methods for staffing agencies to make money is through a salary markup, in which the agency charges the healthcare establishment 25% to 100% more than the outsourced employee’s salary, keeping the additional money as revenue. To learn more about how staffing agencies make money, check out our article.

Can anyone open a healthcare staffing company?

Anyone can open a healthcare staffing company, but you might need some healthcare experience to provide the best medical staffing, especially if you’re looking to staff licensed roles. Having experience in the healthcare field can help build your reputation and make it easier to land clients.

How big is the healthcare staffing market in the United States?

The US healthcare staffing market had an estimated market size of $23.6 billion in 2022.

How much do healthcare staffing agencies make?

Staffing agencies can make money depending on a lot of factors such as location and quality of clients. However, they generally make about $103,000 per year.