Transportation feature — Going places
Transportation often is an overlooked area of operations. But investing in the right vehicles makes good business sense.If nursing home providers could rank top-of-mind issues, transportation likely would fall somewhere deep in the order – after those pertaining to residents and staff – but probably before the needs of the resident dog.
Given today's pressing concerns related to staff shortages, limited government funding, and resident care, tinkering with transportation generally is not a provider's top priority. But that doesn't mean it should be neglected, especially when it comes to reasons of cost.
Choosing the right vehicle, maintaining it properly and operating it efficiently might mean a difference of thousands of dollars. And when it comes to insurance costs, what a provider does with the company wheels is well worth a little thought.
Let's be honest. You probably use vehicles more than you realize. Whether it is taking residents to medical appointments or outings, giving rides to family members, or shuttling employees to work, vehicles are an important part of the business.
"Transportation seems to be the last thing facilities want to look at, but it seems to be an extensive part of the overall operations," observes Jim Bishop, CEO of the Bus Group of Taylor, MI, a distributor of all brands of buses.
Because of current economic conditions, it could be a good time to reconsider the vehicles you drive, experts say. Increases in gas prices in part have influenced the rise of the minivan, one of the latest trends in long-term care transportation. A few years ago, small buses or full-size vans were the vehicles of choice for nursing home providers to use for non-emergency medical visits and recreational outings for residents. But with higher fuel prices, it no longer may make sense to operate such gas guzzlers, experts say.
"A small minivan can get 25 miles per gallon versus a bus, which is eight or 10," says Bill Flynn, co-owner of Atlantic Turtle Top, of South Grafton, MA. "I see that vehicle becoming much more popular in a nursing home-type situation."
A minivan also costs several thousand dollars less than a paratransit bus.
Based on minivans from the major automakers — Ford, General Motors and DaimlerChrysler — paratransit minivans are lower floored side- or rear-entry minivans that can carry up to two wheelchairs and up to four ambulatory people at the same time.
Three such vans on the market are the Entervan made by the Braun Corp., the Autovan manufactured by Autovan LLC of Taylor, MI, and the Amerivan from Eldorado National Co.
Peter Beren, president of Mid America Coach of Kansas City, MO, which sells the Entervan, said that he no longer is doing a brisk business selling full-size raised top vans. Instead, he says his long-term care customers have turned more toward minivans, which are smaller.
Jim Bishop, who also is CEO of Autovan, said sales of his minivan have expanded dramatically in recent years. Autovan manufacturing recently has moved to a 250,000-square-foot facility from a 70,000-square foot facility because of the growth in demand.
The fuel savings between a full-size van and the minivan are substantial. (See sidebar for more.)
Beyond gas prices, a minivan may make more sense in terms of efficiency.
"A lot of times these nursing homes or assisted living communities may own a bus, which holds 12 passengers and two wheelchairs, but they're using that to take one person to the doctor, which is a waste of fuel," Flynn says.
Fitting to size
Still, some nursing homes may need the space of a bus. Dave Brown, president of Mobility Transportation Services, Canton, MI, said he has noticed that the trend among his customers, which include long-term care facilities, is toward buses and away from full-size vans, which have had rollover problems in recent years. Even though gas costs are higher, buses can accommodate more riders.
Knowing what you need the vehicles for and how much use they're going to get are key.
"You have to size the vehicle to the type of need for the community," Beren says. "If it is a retirement community and you have lots of activities, you can get by with a larger piece of equipment than a nursing center. If you're a nursing center, it's silly to have a great big bus when most of the time you're handling one wheelchair."
Another allure of the minivan is anyone on the staff can drive it. The vehicle makes a lot of sense for facilities today, says Sheldon Walle, senior vice president and general manager of Eldorado National Co.
"It doesn't require any kind of a commercial driver's license, your insurance is less because it's not considered a bus-type product and it's very maneuverable," Walle says.
Maintain, maintain, maintain
No matter what you drive, regular, preventive maintenance is another sure way to shave off some excess expenses, experts say.
"Most nursing facilities don't do it," Beren notes. "And so, when [the vehicles] do go down, it tends to be expensive."
He throws out a few simple procedures that will make a big difference: regular oil changes, tire pressure checks, and servicing the air conditioning before the temperature turns 110 degrees outside.
"It's a lot easier to do them in advance than when it's broken down on the side of the road," he noted.
Brown, of Mobility Transportation Services, agrees. He said he receives seven or eight calls a year of buses blowing up due to lack of oil changes.
"We put orange stickers on dashboards and it still happens," he says. "Getting their employees to do the maintenance is an ongoing issue. They don't treat it as their own."
Atlantic Turtletop's Flynn emphasizes the importance of routine maintenance such as cycling the wheelchair lift once a week to make sure it works and running through a daily checklist of seven different items to keep the vehicle in excellent condition.
Of course, vehicles do have limited life spans. So when it comes to making a purchase, there are some helpful nuggets to keep in mind as well.
Flynn underscores the importance of making intelligent buying decisions – especially when purchasing through the Internet. For example, don't be tempted by the "throwaway bus," he says.
Such a bus is cheaper than a premium bus. Facilities might use it for two years, rack up 200,000 miles, and then discard it. But a premium bus product, which could run about $45,000, may last 10 to 15 years. Buses with good safety equipment alone are worth a few extra dollars, he says.
"Yes, they cost a little bit more, but it's less costly than a lawsuit," Flynn says.
If buying a vehicle is not in your budget, there are other options now, such as leasing. Some leases provide maintenance, too, says Walle of Eldorado National.
Buying used may be another option. Bishop, of Fleetworks, said that it's now possible to buy minivans from Ford, DaimlerChrysler or Toyota with 10,000 miles on them but in good condition. That could mean a savings of $6,000 to $12,000.
"So purchasers can get the same vehicle with a warranty on it for a lot less money," Bishop says.
Some companies such as Ford offer incentive programs to nursing homes to reduce the cost of a purchase, Flynn says.
There's no question that owning a vehicle has become more expensive in recent years. That is due, in part, to rising liability costs.
Because of exposure to risk, in some cases owning a vehicle simply may not be worth the trouble financially, notes Dan Palumbo, chief operating officer of South County Senior Services, a nonprofit transportation service in Orange County, CA.
"If you look at risk and due diligence, you can't just have the driver taking nursing home patients to a medical appointment without a certified nurse aide, depending on their condition," Palumbo says. "You have to be very careful. Sometimes that's too much risk for the facility to bear."
One solution is training CNAs to be drivers, he says. That way, a facility does not need both a driver and a CNA for a routine trip to the doctor. And the provider knows it has staff with the resident at all times.
Buying a vehicle entails a host of expenses, including fuel, routine maintenance and insurance, emphasizes transportation expert Halsey King, president of Halsey King & Associates, Carlsbad, CA.
"When you're going to get buses, you're going to be in the bus business," he says.
Want that vehicle but can't afford it? Looking to get the most out of your vehicles? Here are some interesting ways to earn a few extra dollars with your transportation:
- To raise money for that new vehicle you are yearning for, sponsor a fund-raiser. Residents or a local civic organization may want to donate.
- To make your vehicle investment go further, consider making your vehicle available to organizations in the community, such as the Lions Club. Spreading your vehicle around also will result in good PR for the facility.
- Consider using your vehicle for family visits. Such a service could go a long way toward fostering goodwill among families and upgrading the image of your facility in the community.
- Need some extra wheels? Consider contracting with a nonprofit transportation provider or a private company. They may provide transportation more cheaply than having to buy a new vehicle.
- To find out if you are getting the most you can financially from doctors' visits, refresh yourself on Medicaid reimbursement for non-emergency visits. Reimbursement levels vary by state.
The following chart shows savings with an Autovan minivan, compared to costs with a full-size van with comparable ADA equipment*:
Cost of gasoline:
$2.75 per gallon
Number of miles driven per year: 20,000 miles
Number of vans in fleet: One
SAVINGS = $5,500
Cost of gasoline: $3 per gallon
Number of miles driven per year: 30,000 miles
Number of vans in fleet: One
SAVINGS = $9,000
*raised roof, raised doors wheelchair lift, etc.
Source: Autovan LLC