Plop, plop - fiz, fiz

Wednesday, June 30, 2004

YARMOUTH, Maine - Some HME providers believe the answer to rising gas prices could lie in smaller, more fuel-efficient delivery vans, but Rick Perrotta isn’t one of them.
Rising gasoline prices have put the squeeze on providers, spurring them to come up with new strategies to help contain fuel costs.

In fact, the president of New Medical Supply addressed his company’s fuel costs several years ago. That’s when the Charlotte, N.C., company traded in its conventional gas vans for diesel-powered vehicles. The new Freightliner vans cost roughly $30,000 - about $10,000 more than their gas predecessors - but get two-and-a-half times the gas mileage. The strong, durable diesel engines last 300,000 to 400,000 miles compared to 100,000 to 150,000 for the average gas guzzler. Freightliners also include twice as much cubic feet of storage space. (The same can’t be said for smaller, more fuel-efficient gas vans, which carry less equipment and could create new routing challenges, noted one provider.)

“The cost of your vehicle is the difference between what you pay for it and what it is worth at the end, plus your fuel and maintenance cost,” Perrotta said. “The way we calculate it, it costs us half as much using these Freightliners.”

With gas prices averaging $2.07 a gallon nationally mid May, 55 cents higher than a year ago, providers have taken a number of steps to contain fuel costs. That includes scheduling tighter routes, making greater use of UPS and other delivery services and reminding customers to keep closer track of their supply needs.

“We are asking our customers for non-emergency deliveries - additional supplies or oxygen tanks - to plan farther in advance of their needs,” said David Chestnut, owner of Pennyrile Home Medical in Cadiz, Ky. “When they get down to two weeks supplies, call us. That way we can ship it out or schedule it on a route and not have to make an emergency delivery.”

At Total Home Health in Elgin, Ill., Vice President Alan Kirk and company have investigated buying more Venture HomeFill transfilling concentrators as a way to cut down on home deliveries of oxygen.

“It is a painful thing because you have to invest up front, but over the course of our year we can reduce deliveries,” Kirk said. “You can’t let anyone go because you will be growing, but you can push off the time when you will have to hire a new employee.”

To cope with the rising fuel costs, Majors Mobility in Topsham, Maine, this spring began adding a surcharge to service calls outside its coverage area. Customers pay a $50 an hour surcharge. Noncustomers, patients who did not originally buy the equipment from Majors, pay $80 an hour.

The company also may start charging a delivery fee for some products, said President Tyrrell Hunter.

“We have never done it before, but we are looking at it,” Hunter said. “We are looking at everything.”