Amidst a mixed bag of earnings at publicly traded hospital systems, AMN Healthcare and Cross Country Healthcare reported better than expected results for the third quarter of 2016.
Consolidated revenue at AMN Healthcare grew 23% year-over-year to reach $473 million, up 12% on an organic basis, with growth reported across all three of its segments. The firm’s Nurse and Allied segment was up 16%, with the Travel Nursing division an especially bright spot, growing 21% organically, while its allied division grew 10% on an organic basis. Volume in the Nurse and Allied segment increased 12%, while bill rates rose 5%. AMN’s locum tenens revenue grew 7%, with growth noted among multiple specialties. AMN noted in its earnings call that demand continued to be up year-over-year, and that the biggest constriction on current and future growth was supply constraints.
Cross Country Healthcare’s consolidated revenue grew 10% year over year, reaching $215 million. The increase was driven entirely by its Nursing and Allied division, which was up 19% overall, and up 13% on an organic basis. Cross Country benefited from better-than-expected project revenue in the quarter. The firm’s Nurse and Allied division reported strong trends in pricing, with especially strong pricing gains in travel nurse and branch operations, up 9.4% and 13.6%, respectively. The gains in branch operations were attributed in part to servicing ambulatory and outpatient facilities. Physician staffing revenue declined by 19%, driven entirely by volume decreases, which were partially offset by a 4.6% improvement in bill rates during the quarter.
Arguably the most favorable insight from the firms’ financial results is that the market appears to still be severely supply constrained, a condition favorable to healthcare staffing firms, though some have questioned how long this will last given the evolving healthcare environment. Corporate members interested in reading more about Staffing Industry Analysts’ revenue forecast for the healthcare staffing industry in 2017 — as well as the analysis that accompanies the forecast — can do so here.
