There’s a disconnect in healthcare staffing between bill rates and what clinicians want to get paid. Meanwhile, industry consolidation appears to be on the horizon. And it’s back to the future for recruiters who need to rely on the skills they learned prior to Covid-19 when the market felt explosive growth. 

Five top executives from noteworthy healthcare staffing firms discussed what they are seeing with SIA Chief Analyst Barry Asin during a panel at the Healthcare Staffing Summit on Nov. 7 in Arlington, Texas. 

Right now, the view ahead is a bit murky. 

Medical Solutions CEO Rebecca Rogers Tijerino noted a mismatch, particularly in travel nursing, where nurses are not seeing the benefits of traveling at some of the current rates. 

“We are seeing some movement in health systems in their willingness to pay a little bit more, particularly on the specialty side of the business, and that’s creating some more movement in terms of placements,” Rogers Tijerino said. 

However, flexibility in increasing bill rates won’t come until healthcare system CFOs see more of a turnaround on their end, including a couple of quarters of operating profit, she said. 

Cross Country President and CEO John A. Martins called it a “chasm” between bill rates and what clinicians want to be paid. Still, the industry is nearing a turnaround even as the chasm remains. 

“We are closing in on that inflection point,” he said. “We’re seeing orders rise, we’re seeing bill rates stabilize and, as said, in certain specialties we’re seeing the rates increase.” 

Delivering data will help, said Whitney M. Laughlin, chief legal officer and corporate secretary at AMN Healthcare. 

“One of the things that is going to be instrumental for us as an industry to be able to do is to give our clients good information to help them see the situation and to help them price it accordingly,” Laughlin said. “I think that analytics and transparency are what they’re asking for, and I think it’s what we need to give them to help them understand the circumstances and to be able to meet their staffing needs.” 

Rising costs, including MSP fees, also came under scrutiny. 

“The fees have gone up for us significantly year over year; this year is no different,” said Kenny Kadar, president of Coast Medical Service and president of the National Association of Travel Healthcare Organizations. 

“But it’s not just the MSP fees, there are a lot of fees in the margins,” Kadar said. “Now we’re looking at nonbillable orientation hours, we’re looking at cancellation policies and there are all these other kind of soft expenses that ultimately impact our profitability at the end of the day.”  

Consolidation 

Executives are also seeing industry consolidation on the horizon. 

Kadar said his firm was approached by three other firms about possible acquisitions in the preceding week alone. 

Cross Country’s Martins said there are firms that have haven’t been able to align their SG&A as margins have come down. That will likely prompt M&A activity. 

“I think there’s a need for some consolidation because there are companies that need to be helped out,” he said.  

The M&A market will likely start out slowly in 2025 but will get really frothy by the end of the year, Martins said. 

Recruiters 

Changes in the industry are also hitting recruiters. After the pandemic-fueled spike in rates, recruiters are finding they must get back to operating as they did before Covid-19. 

“We’ve kind of got three groups of recruiters,” said Shane Jackson, president of Jackson Healthcare. There are long-timers who were on before Covid-19, those who started during the days of exceptionally strong growth and those who came on after the pandemic. 

“I think with people who’ve been here for a long time, they’re fine,” Jackson said. “They’re carrying books of business bigger than they did in 2019.” 

Those hired within the last year are also doing well. 

“I’m actually super optimistic about Gen Z,” he said. “We’re hiring some awesome people right now. They’re coming in and they work hard and we’re seeing them scale up their book of business faster than we’ve been able to do historically.” 

Meanwhile, those who began amid the pandemic-fueled growth of 2021 and 2022 are being retrained in how to do businesses without a super-expanding market, Jackson said. And the hard work is coming as a surprise to some. 

“Probably most of us in the room at some point were recruiters,” he said. “It’s not a nine-to-five job. It takes a lot of work to actually be really good at that.” 

It’s when reality is different from expectations when people can be upset. Leaders must deliver a vision of what is to come and what is expected. 

“If we can help them live up to that expectation, they’re going to be great,” Jackson said. The problem is when you have people that expect that 2025 will be like 2021.