Good day and thank you for standing by. Welcome to AMN Healthcare's First Quarter 2021 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised, that today's conference is being recorded. [Operator Instructions] I would now like to hand the conference over to your speaker today, Randy Reece, Director of Investor Relations. Please go ahead.

Good afternoon, everyone. Welcome to AMN Healthcare's first quarter 2021 earnings call. A replay of this webcast will be available at ir.amnhealthcare.com following the conclusion of this call. Details for the audio replay of the conference call are in our earnings release issued this afternoon. Various remarks we make during this call about future expectations, projections, trends, plans, events or circumstances constitute forward-looking statements. These statements reflect the company's current beliefs based upon information currently available to it. Our actual results may differ materially from those indicated by these forward-looking statements as a result of various factors and cautionary statements including those identified in our most recently filed Forms 10-K and 10-Q, our earnings release and subsequent filings with the SEC. The company does not intend to update guidance or any forward-looking statements provided today prior to its next earnings release. This call contains certain non-GAAP financial information, information regarding and reconciliations being non-GAAP measures to the most directly comparable GAAP measures are included in our earnings release, and on our Financial Reports page at ir.amnhealthcare.com. On the call today are Susan Salka, our Chief Executive Officer; Brian Scott, Chief Financial Officer; Kelly Rakowski, Group President and COO of Strategic Talent Solutions; Landry Seedig, Group President and COO of Nursing and Allied Solutions; and James Taylor Group President and COO of Physician and Leadership Solutions. I will now turn the call over to Susan.

Thank you so much, Randy, and welcome everyone to our earnings call. We have a lot of positive news to share with you today. However, the most meaningful message is one of gratitude. The impact made by our colleagues' clients, and of course, healthcare professionals to care for and heal our communities is more important than any financial results we are reporting. It is fitting that we are celebrating the International Year of the Nurse, recognizing nurses and midwives around the globe for their important contributions. Today is the first official day of Nurse's Week, and as the largest provider of nurse staffing solutions, I would like to extend our congratulations and deep appreciation to nurses around the world, including those who are a special part of the AMN family. It is hard to believe that just 12 months ago, we were in the early stages of what we thought would be a somewhat shortlist disruption from COVID-19, a little did we know, that the pandemic and other events of the last year would have profound and lasting impact on our country, our communities and our company. Fortunately, today we have more reasons for hope than uncertainty, and we stand together in a much better place than we were a year ago. Though we saw surges of infections last April and July, in the middle of winter, new COVID-19 cases were occurring at five times the rate we had seen at the end of September, and hospitalization rates soared even faster. America's healthcare workers dealt with each surge with tremendous poise, compassion, stamina and grace. Thanks to our healthcare heroes and everyone supporting them, we have made tremendous progress since the worst days of winter. While we are moving closer to the end of the pandemic, our healthcare labor force…

Thanks, Susan, and thanks, everyone for joining the call today. First quarter revenue of $886 million was well above our guidance range. The very tight labor market and recovery in non-coverage demand caused volume and pricing to be stronger than expected this quarter, and this trend is continuing into the second quarter. Included in the first quarter was approximately $25 million of vaccine project related revenue, which was in line with our expectations. First quarter consolidated revenue grew 47% year-over-year and 40% sequentially. Gross margin for the quarter was above the high end of our guidance range at 32.6%, which was a 90 basis points lower than prior year and down 30 basis points sequentially. The margin was lower year-over-year from expected compressed pay to bill spread in nurse staffing, and the outsized growth of Nurse and Allied Staffing relative to our overall business mix. Sequentially, the change in business mix was also the biggest driver of the margin decline. Consolidated SG&A expenses were $161 million or 18.2% of revenue, compared with $146 million or 24.3% of revenue in a year ago quarter, and $155 million or 24.6% of revenue in the previous quarter. The lower SG&A margin reflects favorable operating leverage from the increase in revenue. On a sequential basis, SG&A expenses rose due to higher end support revenue growth, and vaccine-related projects, increases in variable compensation and other employee benefits, and additional marketing cost drive candidates supply. In the first quarter, Nurse and Allied revenue was $657 million, 55% higher than prior year and up 47% sequentially. For Travel Nurse, our largest business in the segment, revenue grew 74% over prior year. With average travelers on assignment growing 8%, the average nurse bill rate up by approximately 50%, and higher average hours worked. Allied revenue returned to year-over-year…

Thank you. [Operator Instructions] Your first response is from Mark Marcon of Baird. Please go ahead.

Good afternoon and thanks for taking my question. Congratulations to you and the entire team for the results, and also what you've done in order to address the crisis. I'm wondering how are you thinking about the second quarter from a bill rate perspective in Nurse and Allied? And how do you think that unfolds as the year progresses? Do you think that just because with the nursing burn out that's occurred in the shortages that we're likely to see elevated bill rates through the remainder of the year? How are you thinking about that?

Thanks Mark. I appreciate the question. Yes, I'll get a little bit of color and it would great to have Landry provide some additional commentary as well. So as we mentioned on the last call, we didn't feel like the bill rates would peak in the first quarter and then start to decline into the second quarter. We are already in discussions with clients coming out in the first quarter around that. And something we have supported, obviously we think it's better for the industry overall and for our clients. That has occurred, it was a little bit more delayed from when we expected. I think with that really tight labor market we talked and orders have actually started to rise again, it's becoming very tight and difficult to see that step down maybe at the rate that our clients would like to see but we're trying to be very thoughtful with them to make sure they have the staff with them every day to deliver their patient care. As we look to the second quarter, the guidance that we did and it does reflect a decline in bill rates in the second quarter. I mean it's kind of steady from April to May to June, and we expect that will continue at the end of third quarter. But again, that's the kind of starting point of that decline was little bit later than expected and the rate of decline has been a little bit slower as well. Landry, anything there? Okay. So that's - I think, what we - we still expect right now that we're trying to get to the end of the year, we'll be kind of closer to the normalized bill rate that was already last time against little bit of delayed start on that. We'll still end up higher than we were pre-COVID, just through normal inflation, and then just the tightening in the labor market further. So we're eventually the land is unknown but we've certainly see that number come down.

Okay. And how are you - you obviously have still a really high level of demand, how do you manage the internal capacity, the internal hiring while things continue to be so strong with the anticipation that the bill rate might come down?

Thanks Mark. It's Susan. We are seeing really relatively strong demand across most of our business. So while we're talking, I think your question is about nursing, specifically. I want to make the point that we have strong demand and growing demand across most all of our staffing-related businesses as kind of core healthcare utilization returns, elective surgeries return, and then you layer on the shortages and high attrition which aren't just a factor in nursing, they are very much a factor across the Allied disciplined, physician, advanced practicing, even in executive search. And so in those cases, we are trying to help our clients not only in filling the temporary jobs but for course helping them in their permanent positions. We started hiring and seeing that demand grow across various businesses, we began adding staff last year, and are continuing to do so this year. So our recruiter and sales staff is up on a sequential basis, obviously more in say Nursing and Allied in some of the others but we are adding team members across the businesses. And then on top of that, our technology has really enabled us to both, attract and get people placed more quickly. I can't say enough about the great job our business and technology teams have done in rapidly deploying some new capabilities so that we are getting out and reaching clinicians more quickly and in a way that they want to do the jobs. So things like AMN Passport that we've been talking about, has really helped us to move faster and actually put more of the power in the hands of the clinicians who make those decisions. So that's just a couple of things that we're doing to make sure that we can handle the capacity. Landry, I don't know if I sold all your thunder, or if there is anything else you want to add there.

No, I mean you covered most of it but of course, our recruit accounts are higher than prior year, are still seeing accounts are higher than prior year. It's kind of in the low teens right now but as Susan mentioned, we also have some of these digital investments that we have. So it's actually helped a lot on our production per person, so we're seeing those quite a bit sequentially but also over prior year. So a couple of things that related to that we talked about on the digital side, but also the advanced medical team; so that the acquisition that we did and we got them integrated both on the Nurse and Allied side, and we're seeing their production double since we got them on to higher system. So it's just a great success story getting them integrated and it's just a great team that we've been able to retain and really help our clients out a bit.

That's fantastic. Thank you so much.

Thanks Mark.

Thank you. Your next response is from Tobey Sommer with Truist Securities. Please go ahead.

Thanks. Could you discuss what you're hearing from clients about their internal staff, you did make some kind of prepared remark about the pressure there? If there is a good way to translate that deficit either in percentage terms of available full-time FTEs versus pre-pandemic or weekly hours of available or some other metric to kind of solidify my understanding of that?

Hi, Tobey, it's Kelly. Thank you for the question. I'll take the third part of your question just to give you a feel for what we're hearing from clients; significantly elevated rates of vacancies, most of our clients I would say have had sort of double-digit percentage, obviously a combination of things impacting that and they are still facing growing levels of attrition, extended leaves of absence, and I think from their work - existing workforce as well that level of fatigue and exhaustion that they are responding to is also limiting some of the hours from a full-time employee perspective. I don't know that we have a good analytics yet to quantify that, Tobey, but I will tell you that those trends we expect to continue. We're working with our clients on how they address the overall workforce, I mean we have to take care of all of our clinicians and response, and make sure that they can continue to provide safe care. There is strategies we're working through our workforce optimization solutions to help them maximize or optimize their existing FTEs, and of course, continuing to supplement them appropriately with contingent staff. But it's little difficult to know sort of what those gaps are in FTEs and how long those will persist.

Tobey, its Landry. I would just add to that, I mean, we've been talking about this for a long time and it was kind of prediction. And what we're seeing today is just as very real. We're hearing that not just from a few clients but almost kind of across the board from our clients that the amount of vacancies that they have, and we believe that a lot of the demand that we're seeing today relates to the shortages that they have due to a lot of the mental health and burn out and fatigue that they commission.

Thank you. From a - if we look at your business mix by shedding sort of where your clinicians are actually doing the work for the customers; how do you see that mix changing overtime acute outpatient home?

Yes, Tobey. So it's Susan here. We absolutely believe we will be following the trends within the healthcare to have more care delivered outside of the acute care setting now. Certainly, acute care will continue to see volumes grow with an aging population, and the acuity of that aging population; so we expect that our acute care clients will continue to be a very important part of our client base, and for that matter they are becoming much more diversified and vertically integrated across many settings. So to be a good partner for them, we need to be able to serve them not just in the acute care setting, but also in home health, and ambulatory surgery, special projects, telehealth as well, and so it becomes important that we have not only the staff but the technologies and capabilities. But in addition to that, there are clients that just serve those outpatient markets, which is why we're very keenly focused on continuing to build those relationships. Yes, staffing into them but with the acquisition of Synzi that we just made, it provides us yet another opportunity to assist those clients with the workforce challenges that they have. So you'll see us continue to make these investments to make sure that we are adapting our strategy into those growing and evolving market.

Thanks. I'm curious where the pandemic has had the most impact on the industry, not just the company. And I'm curious if among the areas might be changes in licensing, credentialing and/or sort of the candidate experience; so make it open-ended for you.

So I'll address licensing, and then open it up to Landry and James to perhaps talk about the candidate experience because it's really across the board. In terms of licensing, I think you know that most states have put in crisis licensure exception, and those orders are going to be continuing, but also likely expiring and/or extended; it's always a little hard to tell they tend to extend them at the last minute, but we would expect that most of them will continue through the year. But the good news is, we continue to also hone our processes in automation, and the way that we are able to more swiftly and with less friction get our clinicians credentialed quickly, a lot of those investments that we've made over the last year have been paid off. So we think even when crisis licensure comes to an end, we'll be able to actually retain a lot of the progress that's been made in speeding up credentialing process for them. And having AMN Passport is a big part of that, we really put more of the self-served opportunity in the hands of our clinicians, they can submit and upload documents, they can see where they're at in the process, it's easier for them to communicate with our team. So I think this last year has actually forced the industry to be more efficient, and use technology in smarter ways to create that better experience for candidates. So Landry, maybe start with you if you have anything else to add about their experience.

Yeah. Tobey, so some of the things that Susan mentioned, I mean the more that we can make it easy to be able to move clinicians around the country, the easier it is, and the faster that we can be. So in the first quarter we saw the highest number of new clinician starts we've ever seen. A lot of that has to do with some of the executive orders that were out there for licensure, and then standardizing credentialing across our client. So I don't - not all of that will stick, but a lot of it will stay - will continue to happen and it just helps us be able to move those clinicians around easier throughout the country. So I know the teams are working hard to work with our clients on that and standardize it as much as possible.

This is James. I think the only that I would add to that is, 90 days into new organization, I was really humbled by our values and mission of who we are as an organization being stood up and being live day in and day out, overwhelmed by the generosity, the capacity, the enthusiasm of our teams to really create an environment that allows people to bring their authentic selves to work and to be successful by the learning and the drive of our team, who we serve and to deliver and helping that candidate to have the best possible experience that they can have put inside of our organization. I think that's a different take on it, but humbled by the experience, the great work that was done before me with Kelly, and we were planning to replace building a solid foundation. I think it comes to how do we drive solutions for physicians? How do we drive solutions for the whole leadership side of it? I'll give you the diversity, equity, and inclusion aside of that. Those things that we have stood up for, because we think that the diverse workforce at all levels is going to be compelling, and as it becomes compelling, we wanted to make sure that we had a diversity action plan that centers around from a client standpoint. How do we help our clients with white papers, with webinars, doing public speaking, creating diverse pipelines? How do we help them with tools that we're not be introducing in the job that helps with proper job descriptions out the market material? To be ensured that they get the best candidate for that placement? How do we help them partner with HBTUs [Ph] to ensure that we are at their course and that we're at their career and that we're partnering with them to be able to drive job opportunities, to position our brand in such a way that helps our individuals to really live their best life inside of our organization? I think it's something that's just as important as the training that we're helping our clients, that we do it internally and do an externally of teaching unconscious bias and I think that all of these things add up to helping create an environment that hopefully drives the candidate experience and helps to really attract the best and be able to deliver that to our clients.

Thank you.

Your next response is from A.J. Rice with Credit Suisse. Please go ahead.

Hi, everybody. I guess, the company's done an amazing job capitalizing on the opportunities and challenges to that the pandemic presented. I appreciate the comments about bill rates as you think about the second half of the year. I'd broaden it out. If you look at the financial profile of the company, the industry, and how the business has evolved three months almost in July commented on this, but as you think about that back half as we're going back to some new normal, how do you think the financial profile or the business profile looks different maybe even said three months ago or pre-pandemic?

Yeah. AJ, thank you for asking this. This is Susan. It's a really important question, because I think this is one of the areas that AMN really differentiates itself. Certainly, very important that we differentiate ourselves for our clients and for our candidates, but, also when you think about the financial profile and operating model of the organization, it's much more diverse today than it was 10 years ago and certainly, much more diverse than others within our industry and we bought this broad and deep set of comprehensive solutions and that means that if we faced headwinds in bill rates coming down, as they should over time, we will have more of a counterbalance and offsets in other businesses where the core underlying demand and volumes are continuing to grow, and in particular, I'd say in the Technology Workforce Solutions and helpful that those also happen to have higher margin profiles for us. We also have been able to build a much more diversified client base. Getting back to the earlier question of the various studies that we're in, yes, we certainly are the leader in providing services to acute care hospitals and systems and very proud of that, but we also have built tremendous client base in other areas, whether it'd be schools or ambulatory surgery or home health, and dental. So there will be many areas that we will continue to build relationships and if anything, the last year has enabled us to create more of those unique relationships that I think will pay off more. Telehealth is another really important area and we made great strides in the last year and still be not only our own capabilities, but also relationships with others. Then we mentioned the tech investments that we've made internally. That also helped change that profile and efficiency of the organization going forward as we use more automation and more self-serve capabilities, not only it creates a better experience for the candidate, it also creates efficiency for the business. I'm just talking from sort of the business profile and strategic standpoint, but Brian, I don't know, if you want to share any more specifics on how that relates to our business mix.

Thanks. I think some things are different, some are actually same. We walked in the beginning of last year, feeling really confident about our business strategy, and bringing together our solutions for our clients in a really differentiated way, and we were seeing that translated into strong financial performance, both at the top and bottom line. And as we said if you look for some of that - because of the noise of what's going on right now, that will start to reappear as you get into the back half of this year moving to 2022. So we feel really confident with the mix of our business and our foundation that Susan talked about. It's going to lead to a more sustainable predictable revenue growth for us and we'll continue to turn out more and more operating leverage from that as well. We feel more confident ever not only in the mix of the business, but in our team's ability to really execute well and the investments we've made and seeing true results from that day in and day out. It's important to double down on that and we've accelerated some of those investments and those will pay off - they're paying off now, they have in the last year. I'm really excited about something that we're going to be rolling out to the remainder of this year and experience that will improve for our clients and our conditions of all of our team members and I think that will continue to translate in a better results as we move into remainder of this year and next year as well.

I wanted to just ask you about operating. You did mention the business sort of comes alongside strikes and so forth. It seems like to me, we're in an environment that may persist for a while, where union activity covering the hospital companies is on the rise and may, like I said, be there for a while. I know your strike business optimist discussed is a one off here - a quarter here, quarter there. I wonder if we're entering an environment where that may become more of a steady source of revenues? What do you see at your discussions and do you think that will increase and will be something that's a steady contributor to results in the next few years?

Hey AJ, it's Landry. Yeah, you're exactly right. There is a very strong pipeline right now, potential labor disruption event. You never really know when they might happen, but there's certainly a lot of noise there and some potential events that could happen as soon as this year. But currently, we don't have anything in our guidance numbers that we're giving for Q2.

Okay, maybe just last question. I would ask you to comment a little more about what the Synzi platform does for you? As I read the press release, I'm not 100 - is this sort of coming alongside competing with the Teladoc or Amwell or this platform is focused in the marketplace in a different way? Can you just maybe expand a little bit about what that capability gives you and what the opportunity you see is?

You got it, AJ. This is Kelly again. We're really excited to have Synzi and [indiscernible] as well join us. It's really not a competitive solution. Think of it as platform that helps us bring together the spirit of communication vehicle in a way that really streamline communication between the patient, their clinician, their entire care giving group. Things like phone, video, messages, and even remote patient monitoring bring that altogether. So it's a very easy to use, secure communication platform. It's really focused on creating that experience and that ability for whether it'd be telehealth companies, whether it'd be our direct clients, like the caregivers, to really engage with that customer base. They're particularly focused today in the post-acute space, the home health space, and the physician office space. So we're really excited to help expand that mostly from a patient experience, but it also allows us potentially to sort of wrap around additional services and our staffing services on that technology to be more holistic. So we're early days in welcoming them to the family, but I hope that help, AJ, kind of describe a little bit more about that capability.

Okay, now, that's great, thanks a lot.

Thank you. Your next response is from Brian Tanquilut of Jefferies. Please go ahead.

Hey, good afternoon and congratulation. Susan, just a question on the growth outlook for the business, right, obviously, you've had a strong run here in the last few quarters. If we take a step back and think of where you thought your long-term growth was late January of 2020 and where you stand today? How different is that outlook if we say three-to-five-year outlook for you guys?

Well, of course, the last year has been nothing like what we thought it would be. In many cases, we're much further ahead of where we thought we would be and in other cases, are still feeling the effects of the pandemic. When I think about what does that mean going forward for the next three to five years, I think we're in a much stronger and better position. Unfortunately, some of it is driven by the acceleration and exaggeration of the shortages that we knew as a country were already going to occur over the next three to five years, but they then exacerbated and accelerated by the pandemic far beyond what I think any of us thought would be possible. That will likely drive more demand across all of our disciplines over the next several years. Also, when we think about our client relationships, we have strengthened many of our capabilities and the relationships that we have talked on last call, I think, about our renewals of many of our large clients over the last year and we feel that we have actually strengthened and deepened those relationships. Because we've been through so much together and while none of us probably delivered perfectly, I think impossible during the environment, I think we all far more than we thought was possible and we built strong trust and collaboration with those clients and really fostered the commitment to do more going forward. Many healthcare organizations fully acknowledged that the healthcare shortages and workforce challenges are not going to go away. They would likely see some permanent changes and no one knows exactly what it will look like, but likely it's going to be hard to attracting key talents than it was previously. So they're wanting to have more conversations about how they can plan for that. It is why our international recruitment business is doing fabulously right now. Our team is great there and they always execute well, but the demand is far more than we can build. Because clients know that they need not only staff now, but they're going to need that core staff, which our international division helps fulfill. They're going to need core staff three to five years from now. I would say, I am much more bullish and feel that we're in a better position both strategically from a relationship standpoint and a growth opportunity.

Got it. Then shifting gears a little bit, as we think about your tech investments, I remember when you bought Stratus, there was a little bit of apprehension from some investors who didn't understand the strategy at that point, but obviously it's been highly successful. So can you provide an update on how you've integrated Stratus in your sales process and also to that point, can you speak to the plans for integrating Synzi into the suite of offerings or how do you plan to leverage the assets of Synzi into the enterprise?

Yes, we would love to, because, yes, the language services team has done an amazing job over the last year and certainly the team integrating. Why don't I let Kelly do it, because that business is a part of her team, to best answer this question?

Yes, Brian, and like you said, the language services was the addition to our team. Number one, it's been a terrific offering, but number two, it's really serves such a purpose in the market and addressing health inequities and access challenges, particularly for the limited English proficiency population, which continues to grow across the country. First and foremost, we just are honored to be able to serve and reach that community in ways that obviously we couldn't before. We continue to develop our ways that our clients can help support that community and I think our greatest learning of on past year has been, how does that platform extend and the virtual nature of that really allowed our hospital other clients to take care of that population. So we see a really natural synergy, when it comes to addressing patient care. I'll tell you, we still have a lot of opportunities to integrate that into our strategic, and MSP accounts, a lot of their growth has come from new clients, and expansion, and we have a lot more opportunity to introduce and bring them into our MSP relationship. So I will say that hasn't been what skilled bit growth among the bank is that really gives us a lot of confidence, and how we do that going forward. Synzi was actually a spin-off, if you will from stratus, so that capability was built within, and the stratus organization prior. So we're - and we have the opportunity to work with Synzi, and a partnership during the pandemic, creating some solutions leveraging their capabilities, and our - so they have incorporated language services for example onto their platform in that secure messaging, and their virtual care protocols, and capabilities. So a lot of opportunity for us to bring those tow platforms together, as well as bring that together with some of our other services, as I mentioned earlier.

Got it. And then last question for me, on fall to a point you made seasons, as we think about your international recruitment efforts, are we seeing a shortening of the lag time you had before the nurses to get their immigration documents? Then, I guess looking forward, as we think about immigration reform, is there anything that you guys, have seen that could change for nurses?

Well, on reform, we are, we are hopeful that not optimistic, because of course immigration reform include many different facets of both, reform for legal and illegal immigration, and oftentimes those to get convoluted, and things get dragged down, and almost nothing gets done. So those reports, I read out that we shouldn't count on there being any kind of broad change that would enable us to increase the number of levers available for clinicians. With that said, there has been some talk of improving the processes to make it faster for that, to occur, not necessarily opening up more, but just trying to smooth out the process. We've not seen it occur, yes, in fact almost the opposite over the last year has created quite a few bottlenecks, as many of the NBFCs have been closed, or have had limited resources, and a portion had travel bans on top of that. And So it's actually been quite amazing, how well our team has done considering all the obstacles, if those obstacles open up more, and they'll be able to grow, I didn't even faster pace, because certainly they have the supply, the infrastructure capabilities, we just need more throughput on the integration front, and Landry, I don't know, if there's anything else to share about the ODP team, again such a great job.

No, you did, you had a lot of the points there, and you're right, the amazing team been doing it, out of the park for sure here recently, I guess the only other thing, I would add is that as the they are expected to hit a new all-time high of our international clinicians on assignment, let's say, toward the end of second quarter, it doesn't begin in third quarter. So really just kind of shows the execution of that team got the right strategy, and it's a good name out in the marketplace build attract supply from other countries, and bring them into the United States to help out our clients.

Awesome. Thank you.

Thank you. Your next response is from Kevin Fischbeck with Bank of America.

Great, thanks, I just wanted to kind of better understand this second surge, if you will, in deferrals in demand, I mean, I guess, it sounds like you're saying, I think you specifically said burnout is one of the reasons, I guess, how much visibility do you have into the exact reason? Why a client is asking for someone like you'd be? You know, whether that referral was coming in, because the hospitals growing volumes, and you from the staff work, the hospital just having higher turnover need someone to place, just trying to understand, it feels like this dynamic of burn out, and being able to kind of measure that from quarter to quarter, you give us a lot more visibility into the same rates and demand.

Yes, Landry. So we don't pay every order for kind of a Raven code of why might be coming in, but we're, of course, Barry, close to our clients all the way up into the C-suite, and that's exactly what we're hearing right now, is that a lot of the demand, is just purely they're vacancy rates that they have the attrition rate, but, they've had it around facility. So I think it's probably one of the biggest reasons, is not reason that we've seen some of the pretty big increases over the last five weeks to six weeks, so seeing sequential increases, and over the last five lease or six lease, we're nowhere close, to where the orders were in that December, January timeframe, they were extremely high, at that point. But, another thing to point out, is that, it's not any one client, it's not any one specialty, is not any one geography, we're seeing it across the board, new demand and total demand being enough. I'd also mention Allied, even with the COVID hospitalizations, that decline there, they have continued to see really strong demand there, they actually even today, they are at all-time highs, that we've never seen in the business, and one of the good things there is that, it's rare, that we would see every specialty within Allied, and that's what we're seeing today. I know, we've talked previously about therapy, of physical therapy, and occupational therapy having some headwinds, at the end of 2019, and if you look at the demand, that we're experiencing there right now if you look, last year that double digits and now, it's in the hundreds of workers that we have. So really hard numbers, and the good thing about that, is that we have really great recruiters there, and we have a great database, we're really good at staffing physical therapy, occupational therapy, so interested to see what they do here over the next couple of months, or on a great trajectory, if there was one specialty within outlined, that I would point out that is down year-over-year it's respiratory, and really the biggest reason for that against some really hard comps, from prior year. But, where we are today, it's still quite a bit higher than what we would have seen pre-pandemic.

Kevin, if it's okay, I think it would be helpful Pertains, to also comment on what we're hearing from clients regarding the locums, and interim leadership demand, and what's driving that.

Thank you, Susan, and thank you for the question. I would add is difficult, as much as what Landry quantify specifically information around the whole not side. But, this year, just a few numbers for us, but you may total remained at 98% pre-COVID, and is that 93% but, core business of pre-COVID, the drivers of those recoveries including Anesthesiology CRNAs surgery dental in 82 our specialties, and we are within 10% of being at the pre-COVID numbers like Landry. We do have a few lagging a specialty in FDM in radiology and interim, which it had a phenomenal first quarter, sequential demand in first quarter, was flat, but they have a high-level uptick in fourth quarter. So they held that the fourth quarter numbers and just keep in mind percent of their order volume results from our COVID related. So the main is expected to sustain elevated levels of going through second quarter just by way of just how we see this in year. We do expect interim to reach pre COVID core, revenue number has been late 2021, and Locums in early 2022 Victor their number of pre-COVID numbers search, and third quarter of 2022.

Okay, that's helpful, and I guess last question, just trying to reconcile the difference, and this is not necessarily news, I mean maybe not, so they have to worry about. But, I guess, I was, when we talk to the hospital companies. I know, it's a small of the industry, but hearing you talk about demand in burn out that all make sense to bill, when you talk to hospital companies, we often talk about. We won't get as many nurses, because we want to nurses on quarantine, if you want to sell that or demand will go down bad. And so I guess, it seems like there is potential offset to some of that, so they're talking about swift reduction in temporary labor, and it sounds like, you're talking about more kind of standard for few more quarters holiday, there somewhat to kind of reconcile, or bridge, but seems to be it's not affecting commentary about temporary staffing over next few quarters.

Yes, Kevin, I don't think contradicting, as Landry mentioned the demand, while it's grown over the last six weeks is still quite a bit lower than where we peak in December and January, so we would say that the demand and the need has come down as well. It did come down and then it actually has come back up, but not nearly back to those levels. So I actually think we're in sync. And I do think that the issues around attrition and vacancies is something that no one could fully anticipate the level of impact because it's hard to know how many nurses are going to come back into rules as facilities need them to come back and I mean what the finding is not as many want to come back into full time roles. Also some clinicians who worked through the pandemic our burned out, and they felt so much trauma that they want to need to take time off and/or do something different, or retire early. So they sort of hung in there until what they thought was near the end and now, they're departing. You just look at the JOLTS data and we've got the highest level job openings in February of '21, 27% above prior year. And the number of openings hires is at a record high 2.3% to 1%. So these issues I think are just now really manifesting themselves as they're wanting to get staff back up and you're finding that they can't find the permanent staff to be higher. So hopefully that helps you to reconcile the commentary, a little bit.

Yeah. No, I think that it does. Yeah. So I guess maybe three years ago saying that you think that overall demand is going to continue to increase that bill rates are going to be coming down. So from the hospital perspective, total spending might be coming down, even though you're seeing from a demand as far as number?

Yes. Yes, I think that's a fair characterization.

And I guess why I believe if the number of placements are going, that just feels to me like that the supply demand and balance and that bill rates should necessarily becoming down as rapidly. Why is that mismatch of higher demand yet lower bill rates?

This is Brian. Keep in mind. Again, demand is elevated above what we consider normal levels from pre-pandemic, but still significantly off the very highest point. And that - it led to some really unprecedented pricing levels that we - everybody wants to get off naturally the dialog is, but it - if they're still elevated, we've talked about the fact that we expect that to remain at the level. But off that very high point that we saw the peak in March, it will come down again because demand is above normal levels but still off that peak level. I think that's part of it - kind of think about it, it's not as strong and it's really not sustainable. As you have a little more predictability in the needs right now and a little more lead time, it just allows us to be able to fill more jobs that at a lower level - of lower rate than we had before, but it will sustain at a higher level. So I think that again - that pace of decline is the hardest thing to predict. We are seeing it come down as we - as we have bookings through the second quarter in the third quarter. But everything right now, is it will stay elevated above again levels that we saw a year and a half ago, because of the shortages and a higher level of demand that we saw year and a half ago.

All right, these are the reference points, I guess. All right, thank you.

Thank you.

Thank you. Your next response is from Jeff Silber with BMO Capital Markets. Please go ahead.

Thanks so much. I know it's late. I'll just ask one. If we're expecting bill rates to continue to go down sequentially, I may be putting words in your mouth, but how would you be able to maintain the bill rate spread, what should we be expecting over the next few quarters?

Well, again, there the rates - bill rates some waiver tied to pay rates and so that - that's what we've been really thoughtful with our clients and making sure we do this in a methodical way and don't have big jarring changes in the rates and to kind of work - we'll work our way down. And I think most clinicians understand that they - the higher they saw at the peak of the pandemic, were very unique to the situation. And so we saw a very compelling proposition for clinicians beyond just pay as well. And So I think as long - as long it's done in a - it's kind of thoughtful way over a period of time, it will likely see - we expect to see spreads improve because as we've talked about even on the prepared remarks, we were taking a lower margin on the higher bill rates during the time very deliberately. And So as you started renormalize back to more reasonable bill rates, pay rates will come down, the spreads actually improve a little bit as well.

Okay, that makes lot of sense. Thanks so much.

Thank you. Your next response is from Mitra Ramgopal with Sidoti. Please go ahead.

Yes, hi again. Just one quick question from me also, I was just curious if you take a longer-term view in terms of the growth opportunities that the pandemic has resulted, as it relates to your MSP relationships, they'd be accelerating clients and maybe change in their mindset in terms of being more willing now to come on board, so to speak.

Yes, I think I mentioned earlier, we definitely have seen a strengthening in relationships that we have but also those organizations that perhaps didn't have a strong managed services partner and some of the help them not just through the crisis, but now to think ahead about how they're going to tackle the longer-term shortages and challenges. We've seen some of those dialog emerge and opportunities in the pipeline for potential new client relationships that you - gives us a lot of kind of positive optimism about the future and how we can continue to build our client base. But in addition to new clients, we have actually a greater opportunity just to continue to partner with our existing clients and find opportunities to help them in areas where we might not already be. So if we have an MSP client where we have Nurse and Allied services, we can bring in the language services solutions, so that we can help them to consolidate and save dollars and have a more consistent experience around their language interpretation services. We can bring in locums. We can bring in our executive leadership businesses. So there's still a lot of opportunity for us to cross-sell and add and expand many of our existing relationships.

Okay, thanks for the question. Congrats again on the great quarter.

Thank you, Mitra.

Your next response is from Sam Kusswurm with William Blair. Please go ahead.

Hey guys, thanks for taking the question here. I just had a quick clarifying question. I think you mentioned in prepared remarks that only 5% in the second quarter revenue expected to be from really the pandemic. Would that only for physician leadership? And if so, can you share what you're expecting for the company as a whole here?

No, that is correct. That was specific to the physician and leadership segment. And really, it's - that's the area, where we're able to provide that type of color. It's very difficult for - in Nursing and Allied, like you mentioned it's not every order it gets tagged in a certain way and it was that the hospitals are able to move the RNs around where needed during this time. So it's very difficult to isolate that. I mean, I think we're - it's - as you think about the second quarter, the majority, I'd say that the pure pandemic-related demand is dissipated, right. The majority of what we're seeing now is based on just the hospital volumes and their - and their staffing levels they need in meeting that as well. So I don't have the percentage, but I think we would look at it is a very low percentage of our second quarter guide would be related to - now we did mention the vaccine related projects, I guess you could - you could say that in the partly related to vendetta but we will isolate that project forward looking more, and we provided that number. But outside of the outages, the normal recurring business revenue and the guide is the vast majority of it is we look at as more normal operations.

Got you. No, that's helpful. Thanks and best of luck in quarter here.

Thank you. Operator There are no further questions in the queue at this time.

Wonderful, well, thank you everyone, for joining us today. We truly are so grateful for all the contributions that so many people and organizations are making during this critical time. We have brighter days ahead for sure and you can rest assured that the AMN team is focused on always evolving and making a positive impact, not just through our business, but in our communities and through all issues that I think, any good organization should be focused on. So thank you everyone.

Thank you for joining us today. This concludes today's conference call. You may now disconnect.