Healthcare organizations spend millions of dollars each year on healthcare recruiting. Most spend considerable time negotiating agency fees—debating whether 20%, 25%, or 30% is reasonable. I believe they’re negotiating the wrong thing.

The better question is this:

Why are healthcare organizations still paying percentage-based recruiting fees that were established decades before artificial intelligence fundamentally changed the economics of recruiting?

It’s a question our industry rarely asks. It should.

An Industry Built for a Different Era

For decades, recruiting was a labor-intensive business. Recruiters manually searched resumes, cold-called candidates, coordinated interviews, maintained spreadsheets, and spent countless hours performing repetitive administrative tasks.

That effort justified the pricing model of the time. But recruiting today bears little resemblance to recruiting twenty years ago. Artificial intelligence can identify qualified candidates in minutes. Automation streamlines sourcing, scheduling, communication, and follow-up. Advanced analytics provide labor market intelligence that once required days of research.

None of this replaces experienced recruiters. It makes them dramatically more productive. Yet despite these technological advances, much of the recruiting industry continues to charge clients using pricing models developed long before these efficiencies existed.

Every Industry Evolves

Technology has transformed nearly every business sector. Banks process transactions faster and at lower cost. Manufacturers produce more with fewer resources. Retailers use automation to improve efficiency while reducing operating expenses.

In almost every industry, productivity gains eventually benefit the customer. Healthcare recruiting has largely resisted that evolution. Many firms proudly advertise their investments in AI and automation, but few explain how those efficiencies have translated into lower costs or greater value for their clients.

Technology shouldn’t simply improve a recruiting firm’s margins. It should improve the economics for the organizations they serve.

Healthcare Can’t Afford Yesterday’s Economics

Healthcare leaders are facing unprecedented financial pressure. Operating margins remain tight. Labor shortages continue. Reimbursement challenges persist.

Every investment is scrutinized. Recruiting shouldn’t be exempt from that scrutiny. The conversation shouldn’t begin with:

“What percentage do you charge?”

It should begin with:

• Why does your pricing model still reflect the economics of twenty years ago?
• How has technology improved your efficiency?
• How are those efficiencies benefiting your clients?
• What measurable value do you deliver beyond filling a position?

These are business questions, not recruiting questions. Healthcare executives deserve business answers.

The Value Equation Has Changed

Historically, recruiting firms were compensated largely for the effort required to find candidates. Today, value should be measured differently. The best recruiting partners don’t simply work harder.

They work smarter. They leverage technology, data, market intelligence, and proven processes to deliver better hiring outcomes with greater speed and consistency. Success should no longer be measured by how much work a recruiter performs.

It should be measured by the value that recruiter creates.

That includes:

• Reduced vacancy costs
• Faster time-to-fill
• Higher-quality candidates
• Improved retention
• Lower total cost per successful hire

Those outcomes, not legacy fee structures, are what healthcare organizations should be paying for. The Future Requires a Different Conversation. Artificial intelligence is not replacing recruiters. It is redefining what clients should expect from them.

Healthcare organizations shouldn’t settle for firms that simply use better technology. They should expect partners whose business models have evolved because of it.

Innovation isn’t just about adopting new tools. It’s about rethinking old assumptions. One of those assumptions is that recruiting fees should remain unchanged while nearly every aspect of recruiting has changed.

That assumption deserves to be challenged.

A Challenge to Healthcare Leaders

The next time you meet with a recruiting partner, ask a simple question:

“How has artificial intelligence changed the value you provide—and how has it changed what you charge?”

If the answer is that it hasn’t, ask yourself why. Technology has transformed healthcare recruiting. Perhaps it’s time the economics caught up.

About the Author

Mike Maffei is the Founding Partner of AlediumHR, a healthcare recruiting and workforce solutions firm helping hospitals, health systems, telehealth organizations, and healthcare companies reduce recruiting costs while improving hiring outcomes through innovative recruiting strategies and AI-powered talent acquisition technology.