They serve as pretend patients for medical students. The job involves portraying patients with various ailments (You need a decent memory -- everyone responds to the students' questions with what is essentially a script -- "Do you have any family medical history?" "Well, my mom has high blood pressure and type 2 diabetes, and my dad passed away from a stroke. My daughter has asthma"), getting examined (no sensitive exams -- but you will be in a gown, have your heart listened to, your abdomen palpated, etc), and grading them (this is the hard part -- there are checklists you have to fill out, sometimes with up to 30 items or so, and you have to remember things like "listened to heart in four locations," "asked me to put my pain on a scale of 1 to 10," "quantified alcohol use," etc). It pays about $20 to $30 an hour. Do it for awhile and do a good job and you can be asked to be a physical exam teacher, which is a whole additional job, that pays $45 to $50 an hour.
It's flexible. You get recruited for projects that are anywhere for 4 hours long to a couple of weeks long, and you can say yes or no. Hours can be short, like I said, 4 hours, or long (up to or even over 12 or so). I'd say about 90% of standardized patients, at least in the DMV, have acting experience, but not everyone does. It's relatively easy, but you have to get the portrayal and checklist right, so attention to detail and a good memory are a must. All of the schools in this area use them (USUHS, Johns Hopkins, GW, Georgetown, Howard, Maryland).