Running on Empty

Unless your ambulances are the horse-and-buggy type, you ve felt the painful increase of fuel costs this year. What affect has the cost of oil increasing to more than $65/barrel and the gas companies raising gas and diesel prices to record levels had on your 2005 budget? Have you made adjustments in your service delivery or charges? Here are some tips to consider before you get gassed at the fuel pump.

Consider the addition of a fuel surcharge: I recently heard that auto part delivery drivers were adding a fuel surcharge for deliveries to auto repair shops. This cost increase was being passed on to the consumer, resulting in higher repair bills. Now, many airlines and other companies affected by fuel costs are adding surcharges to their consumers bills to compensate for the dramatic increases in fuel costs. Perhaps your ambulance service should consider this method as a part of its fee schedule and budget.

Adjust your mileage fees according to fuel prices: Rather than predict your fuel costs in terms of a percentage increase or set amount increase, forecast your fuel costs for next year on the basis of a set dollar amount per gallon. For example, if you projected your fuel costs at $2.25 per gallon and the price of fuel goes to $3.50 per gallon, you ll need to adjust the mileage fee charged. Hopefully your fee schedule is flexible enough for you to change your mileage or fuel surcharge on a weekly, if not daily, basis.

Investigate an annual contract rate: Whether your service gets its fuel from a commercial provider or has its own bulk storage tank, you ll want to negotiate the best price possible for annual fuel use. With the current instability of prices, you may be able to get guaranteed prices on only a short-term basis. The amount of fuel you require may affect the contracted price.

Consider joint purchases with other agencies: If you re a single entity with a small volume of annual fuel usage, you may want to see if you can go in with other ambulance services or city/county agencies on annual fuel purchases. If other agencies buy in bulk and you can purchase your fuel from them, you can save in the long run. Another option is your local school district: If they re running a number of school buses, they would likely be open to joint fuel purchases.

Perform regular vehicle maintenance: Whether your vehicles are properly operating will affect your fuel mileage, so it s important for crewmembers to immediately report any problems so that vehicles are kept running at their peak performance level. Ensuring that vehicles are well maintained with regular checks and changes of oil, fuel and air filters will result in better fuel mileage. Tire pressures should also be checked on a daily basis to ensure proper inflation, because tire pressures can affect driving and mileage.

Limit miscellaneous driving: Some agencies allow crews to go anywhere within the assigned service area as long as the providers are available for immediate response. They can go to the grocery store or out to eat at a restaurant. Because of this miscellaneous driving, agencies can lose track of accurate fuel costs. If your ambulance crews have an actual base, you should limit the reasons they leave quarters except for calls or special events.

Review the type of vehicles purchased: Many agencies have bought medium-duty chassis ambulances in order to have bigger, longer lasting vehicles. But these vehicles don t typically get great gas/diesel mileage, and the increased costs to fuel these vehicles may be even more noticeable. It s important to do some calculation before your next purchase on the projected fuel expenses for a medium-duty vs. a type I, type II or type III ambulance. Those figures will factor into your decision about the kind of vehicle to purchase.

It s unlikely that fuel costs will drop significantly in the next year. Some economists are predicting fuel prices to reach as high as $5 per gallon in the coming months. For most agencies, that kind of spike would double their annual fuel costs. So be prepared, and take the necessary steps to manage these increased expenses. Don t get trapped by the rising costs of fuel next year; take action now to protect your agency.

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