Every year for the next 18 years, 4 million baby boomers will turn 60. By 2030, 20% of the population will be over age 65.

There will be major implications for the health care industry, to be sure. Yet even as we debate who pays for what, the bigger question is who will physically take care of nearly one-fifth of our population in the future?

There aren’t enough health care workers to go around now. Even worse: A study by the University of Illinois College of Nursing showed that the number of caregivers will decrease by 40% between 2010 and 2030.

You can profit from this trend by owning two stocks that are in the business of staffing the health care industry. I expect these two stocks to return 20% annually for the next five years.

Health Care Stock #1 – AMN Healthcare (AHS)

AMN Healthcare (AHS) is the largest health care staffing company in the U.S., with 10% of the market. That’s just about twice the market share of its closest competitor, CHG Healthcare Services (CHGH).

Now I don’t normally like to buy companies that are already leaders in their field, because I generally find these stocks are already fairly valued or even overvalued. But AMN Healthcare is an exception.

The health care staffing industry is so highly fragmented that I see plenty of opportunities for growth ahead for AMN. In fact, in this case being a leader in a highly-fragmented industry gives AMN an advantage. The company can grow both internally and through acquisitions.

Over the years, AMN has expanded to a point where it can now fill almost any kind of health care staffing vacancy, whether it is in acute-care hospitals, physician practice groups, rehabilitation centers, dialysis clinics, pharmacies, home health service or ambulatory surgery centers.

Now AMN has not escaped this recession without some wounds. In its most recent quarterly report, AMN reported earnings of $4.4 million or 13 cents per share, a 48% drop from the $8.5 million, or 25 cents per share, earned in the same period last year.

But, that’s only part of the picture. The good news is that Wall Street analysts expected earnings of just 6 cents per share, and AMN more than doubled that.

Also encouraging, the company’s focus on cost-cutting boosted gross margins from 25.6% in first quarter to 27% in the second quarter. By comparison, that’s about double the average gross margin for the health care staffing industry.

Even better: AMN has taken significant steps to improve its balance sheet since the beginning of the year. The company reduced its outstanding debt by $56.3 million, to $90 million, and doubled its cash position from $11.3 million to $23.5 million.

Now AMN is not out of the woods yet. The company is forecasting a 15% decline in sequential revenue for next quarter, because many medical providers are reluctant to add staff until they are assured the economy is indeed, on its way to recovering. Additionally, the uncertainty of the various health care proposals making their way through Congress is hindering hiring.

I am not worried about that. I strongly believe that once the economic recovery is a given, we will see an absolute boom in this sector. And I think that now — while the healthcare staffing business is hitting the trough of this depressed economic period — is the time to buy into the sector.

It may be early, but I believe the risk of any significant drop in the stock is small. And as the economy improves, we will be there to reap the big rewards.

Health Care Stock #2 – Cross Country Healthcare (CCRN)

My second favorite health care staffing stock is Cross Country Healthcare (CCRN), which is in the same business as AMN, but benefits from a couple of additional growth areas.

CCRN is the third-largest temporary health care staffing company in the U.S. Its services include temporary physicians, travel nurse staffing, travel allied health professional staffing and per diem nurse staffing.

In addition to temporary staffing, CCRN also offers clinical trial services, including contract staffing, clinical research outsourcing, drug safety monitoring and regulatory consulting services to pharmaceutical, biotechnology and medical device companies, as well as to contract research organizations.

CCRN has a good track record of expanding through acquisitions. In the past decade, the company has acquired 12 competitors, the latest of which was in the third quarter of 2008, with the acquisition of MDA, a specialist in physician staffing in 50 states.

Like AHN, CCRN’s second quarter-results suffered due to the soft economy. Net income fell to $2.3 million, or 7 cents per share, from the $6.4 million, or 21 cents per share, in last year’s second quarter. Revenue declined 13%, to $149 million.

But like AMN, Cross Country also beat analysts’ estimates — in their case, by 2 cents per share. In fact, that made three quarters in a row that CCRN beat the forecasts.

The company has also maintained excellent cash flow, which has allowed it to substantially reduce its debt — by $24.4 million during the quarter — even in these tough times.

The company expects continued pressure on earnings for the third quarter, projecting earnings per share of 0 to 2 cents per share on revenues of $130 to $133 million.

But once we get through the third quarter, which ends in just a month, watch out! Management says it is already seeing a turnaround, with nurse and allied staffing demand more than doubling since early June.

Once the economy gets back into full swing, I expect this health care segment to become one of the fastest-growing sectors in the economy over the next few years.