Barring anything else, if the margin remained at 22%, you had to put 8%, you could easily see it at before 14%, so we’d be 200 basis points off of that mark right now for where we ultimately want to get to. So that’s what we’re lining up to really go after as we move into 2024. I will say you further on to the last question from Brian. We’ve taken a lot of cost actions. We’ve taken out 20% of the headcount since the start of the year, all with a very, I would say it has not been a broad sort of approach. We’ve been very targeted and focused on where we reduce, but it’s important to understand we still have investments in there, right? So we’re still spending, there’s a fair amount of IT expense tied to projects from a consulting and professional fees perspective that doesn’t get capitalized, and so that’s running through there.
It’s probably north of well over a $1 million a quarter that’s in there just from third party spend, maybe a $1.5 million that’s in the operating expense from projects. And then you’ve got other areas that we just haven’t scaled down because we still believe in them as opportunities for growth. And so, homecare, education, the businesses we talked about there and physician staffing are still invested heavier than, we’re not at full capacity to say it another way.
Kevin Fischbeck: Okay, great. That’s helpful. I guess as you talked about the demand, I think you said 5% of the orders were kind of winter orders. Where would that normally be at this point in the year?
John Martins: It would be somewhere probably 20%, or north of 20%, 20% to 30%. But what the difference is, Kevin? Would we be getting the orders of the winter needs? And then you fill them because what happens is the start happening from October all the way through January, February for those winter needs. So, the 5% is more of a stagnant 5%. As we also mentioned in the prepared remarks, a lot of the orders we’re seeing, about 50% of them, aren’t at the bill rates that would commiserate with the pay rates that the nurses are expecting. And so, some of what we’re seeing is we don’t see the quicker turn on the orders. And what happens is hospitals are waiting until they are beyond demand, beyond what they need to then increase the bill rate to attract the supply.
And so, what we’re seeing is not as many orders. So, it’s a combination of yes, 5%, and probably it’s about 20%, or 20% to 25% of those orders are winter orders, but those orders turn fast. They come in and we start booking them in July, August, September, October. We haven’t seen that. We’re seeing around 5% and they’re taking a little longer to book, if that makes sense.
Kevin Fischbeck: Okay, great. And then, I guess, as you think about next year, again, you guys aren’t giving guidance here, but I guess you feel like the Q4 number is a good basic kind of start a run rate or is there still anything kind of in here where you say like hey, we can still move target as far as where demand and bill rates go anything else to kind of think about as far as what Q4 looks like and why that may or may not be a good starting point for next year.
Bill Burns: Yes, Kevin. It’s Bill again. I’ll start on this and I’m sure John will weigh in. Look at the fourth quarter and I do think it’s a good jumping off point as you look to the next year. They’re both headwinds and tailwinds and just to put that in context when we look at the travel bill rates and we talked about there’s a lot of stability in the open order rates and there’s a lot of stability for the last four or five months on the rates that we’re locking at. The rates we’re locking at to what’s implied in the guidance there’s probably another low single digit sequential decline in bill rates on travel because you’re going to the first half of 2024. So you get a little bit of a headwind there then it really becomes how fast the other programs really start to ramp from the MSP wins and the VMS wins that we’ve had. But John anything you want to throw in there?
John Martins: I think you covered it, Bill. I think there’s puts and takes to everything. I think what we’re very encouraged by are those five Intellify wins we had this year, which are ahead of our schedule, winning that $100 million deal that we’re implementing right now will give us an opportunity to capture 20% to 40% of that in our staffing side. And then in addition, we did win five more MSPs for our home health business. And then we also won a locums MSP and we had cross sold to our current existing MSPs, three locums MSPs. So one of the things also, just looking at our overhead, one of the things we’re continuing to invest in is as Bill mentioned, technology because we’re never done investing in technology. Obviously with Intellify, what we’re getting, we’re getting a lot of good momentum with Intellify, but also with our data aggregation services or DAS that is truly the first, what we believe is the first technology in the industry that has true bill rate transparency that’s catching on.
So we’re investing in technology. And of course with that comes investing in marketing to get the word out of this great technology that we have that really, we believe is industry changing and then investing in sales because it all goes hand in hand. So we’re going to continue to invest in those areas and that will have some, we believe will have upside for us in 2024. Dan, do you want to add anything to that?
Dan White : Sure, Kevin, this is Dan. I just think we should also look at our sales funnel is 25% going bigger, going into this quarter than it was even last quarter. And last quarter was the biggest one we have ever had. So the opportunity that’s ahead of us continues to be really, really strong. One of the things that I’m seeing is that customers are being a lot more selective. We give them way more options than historically we have. So, not only MSP or VMS, but some customers are looking at self-managed programs where they just take the technology and manage it themselves. So we see lots of opportunity going. Probably the biggest area of interest in the last quarter has been around our IRP technology. That allows us to help them manage their own core staff first using experience, our mobile app, and then add in those augmented staff that we can provide on a contingent basis.
And so we’re really starting to add more value into the whole workforce than we ever have. And from my point of view, I think that’s what’s really going to begin to make a difference in our win rate.
Operator: Our next question is from Trevor Romeo with William Blair.
Trevor Romeo: Good evening. Thanks for taking my questions here. First, just wanted to ask on the supply side, I guess, what are you seeing in terms of willingness for nurses to either move into travel roles or continue traveling? It seems like hospitals have been pretty successful reducing turnover. Just curious kind of what extent you’re seeing maybe travel fatigue with nurses who did travel assignments, but maybe now have less incentive to travel given the decrease in pay rates.
John Martins: Hi, Trevor. This is John. Good evening. I think really what we’re seeing, when you look at the macro numbers, I think it’s really looking at the macro numbers and looking at, if you look at the BLS JOLTS data of openings to hires, and that’s, I think, at 2.27. And it was, I think, 2.27. I think they adjusted from down from 2 30 down to 2.27 for August. I think we’re seeing is that hospitals are still even hard time hiring nurses, and there still is this systemic shortage of nurses that is not going away. And I think they, even though openings declined a little bit, hires have declined even more than the openings. So it’s hard to hire nurses now. We did have quite a bit of labor disruptions where we’re seeing pay increases happen to the core staff.
