So that may have slowed a little travel down. But as we’ve said before, really, when you look at the contingency labor or in healthcare and the travel nurse in particular and travel allied, we’re just a number or percentage of what the base pay rates are. So when hospitals need to attract clinicians, they have to bring out a certain pay rate that will have a compensation package that will attract enough clinicians. So what we’re seeing is, and we’re seeing the clinicians, as we mentioned, about half of our orders are at rates that are truly not fillable for the pay expectations of clinicians, as hospitals start to want to utilize more of these open orders and fill these open orders, I would imagine we’re going to see, there’s the opportunity for them to have those lower bill rates to increase the bill rates that are fillable.
And so to answer your question, we’re not seeing a lot of nurses leave travel nurse right now. I think maybe six months ago, nine months ago as the market was changing, we saw a bunch of travelers go permanent and we saw the market contract. But right now with the stabilization, the amount of open orders we have, the stabilization of the bill rates also creates a stabilization of pay rates, which are keeping those travel nurses within the industry still. Well, actually, one other thing I would add to that is one of the things we’ve seen in our renewal rates, and that’s how we track a clinician who has an assignment with us and then takes another assignment with us, our renewal rates have been very steady for the last several months. And that percentage is at pretty much historic highs, or historically we’ve been at our high.
Trevor Romeo: Okay, thanks, John. That’s helpful. And then on your MSP contracts, how long has your capture rate been trending lately? Given the step down in orders, are you seeing opportunities to boost that capture rate to provide some downside protection? And how do you think about kind of balancing that with retaining supply for potential new orders?
John Martins: Sure, so we’re very careful about our capture rate, and we’re very calculated and strategic about it. Historically, we averaged somewhere between 65% and 70% capture rate, and we’re right in that market. I think we were 66% or 67% in the last couple months. And part of that is we could close those orders to suppliers, but we don’t. One of the unique opportunities that we have is to make sure that we have a strong supplier network, and that we truly are a partner network with them, that we’re partnering with them and giving them opportunities to fill orders, because at the end of the day, the more supplier supply we can have, it gives us the opportunity to have our suppliers help fill our current MSPs, and then have us at Cross Country have excess supply to go out and win new MSPs.
Operator: Our next question is from Tobey Sommer with Truist Securities.
Tobey Sommer: Thanks. I wanted to make sure I understood your comments about the high single-digit EBITDA margin still sort of achievable. What kind of revenue and gross margin do you assume in that comment that would yield that? Is that an applicable to ‘24, or is that sort of a longer-term vision?
Bill Burns: Hey, Tobey, it’s Bill. So I guess I wouldn’t say it’s a longer-term vision, but I mean it’s certainly not a 1Q out kind of a number. I think that there’s a handful of things we do want to see organic top-line growth, obviously a little bit of gross margin improvement would be helpful, whether that’s from improved mix or bill pay spreads or Intellify wins, et cetera. So I think there’s a little bit of that, but we’re not counting on massive, on any one of those in a more significant way than the other. I think it’s about a multifaceted approach of getting to that answer. I think we’ve got to do all of the above. We talked about growing margins; we’ve talked about tightening our SG&A and getting more efficient. So there isn’t really one answer that I’m going to point to that’s going to say is more important than another. I think we’ve got to do it all.
Tobey Sommer: Okay. That makes sense. So then I have potentially bill pay spread compression and you’re going to balance sort of profitability and defending market share, then sort of outlook for a high single-digit margin could be quarters away, not just a single quarter away, right?
Bill Burns: I mean, again, it depends on how the business really performs as we move into early ‘24, right? So if the larger program is like the one, we just talked about, the $100 million program, if that ramps, it has the possibility of potential to add $10 million annually in the bottom line, right? And just broad stroke and think about the profitability of how that works with a vendor neutral. So that’s a couple million dollars a quarter right there, just from having that kind of a program go live. So you’ve got that opportunity, I think, the opportunity of getting SG&A down further when I said earlier, we are laser focused on this right now. We’ve got a companywide initiative to look at how do we take our more manual processes and bring them to a place where we either automate them or bring them to the lowest cost possible, right?
That’s what we’re looking to do. So I wouldn’t say it’s far, far into the future. I mean, I’m not going to go out and put a quarter out there as to when it exactly happens, but it’s certainly possible in ‘24 to see us get back to 8%. Maybe not for the full year, but I think certainly within ‘24.
John Martins: And Tobey, this is John. I would just add that we’re going to manage the gross margin to the EBITDA, which really means that we’re going to be looking at that SG&A number to make sure that we get to that the high single digits. And that’s how we’re going to be managing the business. And what that means is as we’re investing in technology, in sales, in marketing, as we’re, and some of those things that we’ve done as Bill mentioned that we reduced our workforce by 20% over the last year. But what we’ve done is we’ve also kept enough that we believe as the market rebounds in 2024, we want to be in a position to capture the upside. We don’t want to go so low that we couldn’t capture the upside of that. And of course, we can continue to flex up or down, depending on where the market. — what happens to the market over the next six months, nine months as we look into 2024.
Tobey Sommer: Okay. Could you comment on sort of the competitive pressures for market share? And gross margin and bill pay spread I guess are all sort of intertwined. What is the dynamic there as others are probably feeling the same thing and feeling like they need to try to take share to cover their own G&A percentage and have enough revenue on top to kind of keep their margin and profit goals.
