Retained, Direct Hire, RPO or Contingency: A Buyer’s Guide to Permanent Search
When it comes to healthcare permanent recruitment, not every hiring challenge calls for the same approach. Filling a hard-to-recruit physician position, hiring a new clinical leader and staffing multiple new locations are very different challenges. Yet healthcare organizations often approach them using the same recruiting model.
Understanding the differences between retained search, direct hire, recruitment process outsourcing (RPO) and contingency search can help you make better decisions about where to invest your recruiting dollars.
And with the Association of American Medical Colleges projecting a shortage of up to 86,000 physicians by 2036, finding the right approach to recruiting healthcare talent is becoming increasingly important.
Retained Search: When the Position Is Too Important to Leave to Chance
Best for: Hard-to-fill clinical positions, specialized physicians, executive leadership and other business-critical hires.
Retained search is often associated with executive recruiting, but its value extends well beyond the c-suite.
For healthcare organizations, a difficult-to-fill physician position can be just as important as an executive vacancy. A prolonged opening can affect patient access, provider workloads, revenue and growth plans.
With retained search, an organization engages a recruiting partner to conduct a dedicated search, typically with an agreed-upon fee paid in installments.
Unlike a traditional contingency arrangement, the recruiting firm commits resources to the search from the outset.
Why healthcare organizations choose retained search:
- Dedicated recruiting resources focused on a specific position
- Proactive outreach to qualified candidates, including those not actively job hunting
- Deeper market research and candidate evaluation
- A structured search process with defined expectations and progress reporting
- Greater continuity and accountability throughout the engagement
When it makes sense:
You’ve been trying to fill a specialized physician position for months, your candidate pool is limited, or the vacancy is creating significant operational challenges.
The important distinction? Retained search isn’t necessarily about the seniority of the position. It’s about the difficulty and importance of the hire.
Recruitment Process Outsourcing (RPO): When You Need More Than Individual Placements
Best for: Organizations with sustained hiring needs, multiple locations, expansion plans or limited internal recruiting capacity.
Sometimes the challenge isn’t finding one difficult-to-recruit clinician. It’s managing a continuous flow of openings across an organization.
Rather than engaging a recruiting firm for individual placements, an organization partners with an outside provider to manage some or all of its recruiting process.
According to the Society for Human Resource Management (SHRM), RPO arrangements can take several forms, including comprehensive outsourcing, hybrid models that supplement internal teams and project-based engagements.
For healthcare organizations, that flexibility can be particularly valuable.
Why healthcare organizations choose RPO:
- Dedicated recruiting capacity without expanding internal headcount
- Consistent recruiting processes across departments or locations
- Improved visibility into hiring pipelines and performance
- Support for workforce expansion and changing hiring volumes
- A recruiting partner that becomes familiar with your organization and its hiring needs
When it makes sense:
You’re opening several new clinics, experiencing sustained hiring demand or asking an already stretched internal team to manage more positions than it can reasonably support.
RPO can also be a practical option for organizations without a dedicated internal talent acquisition function.
The biggest advantage isn’t simply having more recruiters. It’s creating a more consistent, scalable approach to hiring.
Direct Hire: Support for Building Your Permanent Workforce
Best for: Organizations seeking permanent employees that need additional sourcing, screening or recruitment support.
Direct hire is a familiar term, but it’s worth clarifying what it actually means.
Technically, direct hire describes the employment arrangement: a candidate is recruited for a permanent position and becomes an employee of your organization.
It doesn’t necessarily describe how the recruiting firm is compensated.
Direct-hire recruiting can be structured through retained search, contingency search or another agreed-upon arrangement.
For healthcare organizations, direct-hire services provide access to external recruiting expertise without requiring the organization to manage every step of the search.
Why healthcare organizations use direct-hire services:
- Access to candidates beyond their existing networks
- Support with sourcing, screening and candidate engagement
- Reduced demands on internal recruiting resources
- Flexibility to structure engagements around specific hiring needs
When it makes sense:
Your organization needs to hire permanent physicians, advanced practice providers or other healthcare professionals and wants an experienced recruiting partner to help build its workforce.
When evaluating direct-hire services, ask how the search will be structured, what resources will be dedicated to it and how success will be measured.
Contingency Search: A Flexible Option for Certain Hiring Needs
Best for: Individual openings where organizations want external recruiting support without an upfront search fee.
Under a contingency model, the recruiting firm typically receives payment only when a candidate it introduces is hired.
This can be attractive to organizations that want to supplement their internal recruiting efforts while limiting their initial financial commitment.
However, contingency arrangements don’t always provide the same level of dedicated attention as a retained engagement.
Because recruiting firms are compensated only when a placement occurs, they must balance their resources across searches based on the likelihood of success.
For straightforward positions, this approach may work well. For particularly challenging searches, a more committed partnership may be worth considering.
When it makes sense:
You have occasional hiring needs, sufficient internal recruiting capacity and positions that don’t require an extensive, dedicated search.
How to Choose the Right Healthcare Recruitment Model
Before comparing recruiting fees, consider what you’re actually trying to solve.
- Is this a difficult search or a recruiting capacity problem? If you’re struggling to find qualified candidates for one critical position, retained search may be appropriate. If you’re struggling to manage dozens of openings, RPO may be a better fit.
- How much is the vacancy costing your organization? An unfilled clinical position can affect patient access, productivity and existing staff workloads. The lowest recruiting fee doesn’t necessarily translate to the lowest overall cost.
- How much internal recruiting support do you have? If your team has the capacity to manage most of the process, targeted search support may be sufficient. If recruiting demand consistently exceeds your resources, consider a more comprehensive partnership.
- How specialized is the talent you need? The smaller the candidate pool, the more important proactive sourcing, relationship-building and market knowledge become.
- What level of accountability do you expect? Ask prospective recruiting partners about their search process, communication, performance measures and responsibilities. Make sure the engagement structure supports your expectations.
The Right Recruiting Strategy May Include More Than One Model
Healthcare organizations don’t need to choose one recruitment model for every position.
A growing multisite provider organization might use retained search for a difficult physician opening, RPO to support ongoing expansion and targeted direct-hire services for other permanent positions.
The goal isn’t to choose the least expensive or most comprehensive recruiting solution. It’s to match the level of support and commitment to the challenge you’re trying to solve.
At Optigy Group, we specialize in helping healthcare organizations navigate complex workforce challenges, including hard-to-fill clinical positions. Whether you need a dedicated retained search, scalable RPO support or help building your permanent team, we start by understanding your hiring priorities and developing an approach that fits.
Struggling with a difficult search or growing hiring demands? Let’s talk about the right recruiting approach for your organization.
