The following discussion should be read in conjunction with our consolidated
financial statements and the notes thereto and other financial information
included elsewhere herein and in our Annual Report on Form 10-K for the fiscal
year ended
We provide healthcare workforce solutions and staffing services to healthcare
organizations across the nation. As an innovative total talent solutions
partner, our managed services programs, or "MSP," vendor management systems, or
"VMS," workforce consulting services, predictive modeling, staff scheduling,
credentialing services, revenue cycle solutions, language services, and the
placement of physicians, nurses, allied healthcare professionals and healthcare
leaders into temporary and permanent positions enable our clients to
successfully reduce staffing complexity, increase efficiency and lead their
organizations within the rapidly evolving healthcare environment.
We conduct business through three reportable segments: (1) nurse and allied
solutions, (2) physician and leadership solutions, and (3) technology and
workforce solutions. For the three months ended
Physician and leadership solutions segment revenue comprised 16% and 20% of
total consolidated revenue for the nine months ended
Technology and workforce solutions segment revenue comprised 11% and 9% of total
consolidated revenue for the nine months ended
As part of our long-term growth strategy to add value for our clients,
healthcare professionals, and shareholders, on
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We monitor the following key metrics to help us evaluate our financial condition and performance, identify trends affecting our businesses, and make strategic decisions: •average travelers on assignment represents the average number of nurse and allied healthcare professionals on assignment during the period; •bill rates represent the hourly straight-time rates that we bill to clients; •billable hours represent hours worked by our healthcare professionals that we are able to bill on client engagements; •days filled is calculated by dividing total locum tenens hours filled during the period by eight hours; •revenue per day filled is calculated by dividing revenue of our locum tenens business by days filled for the period; and •bill-to-pay spreads represent the differential between wages paid to healthcare professionals and amounts billed to clients. Recent Trends
Demand for our temporary and permanent placement staffing services is driven in
part by
In our nurse and allied solutions segment, prior to the COVID-19 pandemic, our
ability to recruit enough nurses to meet the then-current demand levels was
impacted by the tight labor market and modest bill rate increases. At the peak
of the pandemic, demand for nurses was most concentrated in specialties
including ICU and telemetry nurses. Now, the current historic demand levels are
dispersed across many specialties. Our clients are faced with increased labor
shortages resulting from nurse burnout, attrition, retirements and, to a lesser
extent, the impact of mandatory vaccination requirements. Bill rates and wages
for these nurses have continued to remain well above prior year levels due to
the significantly higher demand and our clients' need to frequently fill
positions quickly. Although the number of nurses on travel assignments has
increased since
The overall demand in our allied staffing division reached all-time highs in the third quarter. We saw record quarterly demand in our respiratory, laboratory, and radiology specialties, while our rehab therapy specialty saw its largest new demand quarter since 2019. The increased demand in some of these specialties was driven by COVID-19 hospitalizations, testing, and vaccination support. Demand in other modalities were driven by the continued surge in elective procedures as more of the population has become comfortable re-entering physician offices and outpatient centers. The return to in-person schools and additional federal funding has driven our school modality to strong year-over-year increases in all healthcare specialties.
In our physician and leadership solutions segment, demand has recovered and now exceeds pre-pandemic levels. We have seen particularly higher demand for certain specialties, such as anesthesiologists, certified registered nurse anesthetists and advanced practice clinicians, in our locum tenens division. Longer term, we expect continued strong core demand resulting from an increased level of burnout and turnover of healthcare leadership roles.
In our technology and workforce solutions segment, our VMS technologies experienced increased utilization and revenue growth this year due to increased demand levels and elevated bill rates.
The utilization of our language services business continued to grow as healthcare utilization returned to more normal activities and with the need and importance of these services having been demonstrated during the pandemic.
The demand for our recruitment process outsourcing increased in the third quarter as clients look for solutions to help address the increased labor shortages and the need to address vacancies in their permanent roles. We expect this increased demand to continue in the current constrained labor market.
As our businesses have continued to grow, we have increased our sales and operations workforce to support our clients and healthcare professionals. We have also increased spending to support our current team members and retain talent.
Critical Accounting Policies and Estimates
The preparation of our consolidated financial statements in conformity with
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estimates, including those related to intangible assets purchased in a business combination, asset impairments, accruals for self-insurance, compensation and related benefits, accounts receivable, contingencies and litigation, contingent consideration ("earn-out") liabilities associated with acquisitions, and income taxes. We base these estimates on the information that is currently available to us and on various other assumptions that we believe are reasonable under the circumstances. Actual results could vary from these estimates under different assumptions or conditions. If these estimates differ significantly from actual results, our consolidated financial statements and future results of operations may be materially impacted. There have been no material changes in our critical accounting policies and estimates, other than the adoption of the Accounting Standards Updates ("ASUs") described in the accompanying Note 1, "Basis of Presentation," as compared to the critical accounting policies and estimates described in our 2020 Annual Report.
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