Traveling doctors feel gas price pinch

Energy prices have gone way up, and it is bringing some people down. Record-setting oil and gas prices are squeezing the wallets of most American consumers while threatening to put even more of a chokehold on people who must travel as part of their jobs, including some physicians.

The trend is unprecedented, with the national average price for a gallon of regular unleaded gasoline breaking records in the wake of the Hurricane Katrina disaster, according to the travel club AAA. At the beginning of this month, several markets were approaching $4 and even $5 per gallon. At the same time, oil surged past $70 a barrel -- more than twice the going rate two years ago -- and natural gas prices have reached near highs, causing fears that winter heating bills will set their own records.

For Bahram Elami, MD, these factors could translate into thousands of extra dollars in business expenses for his practice. The internal medicine and geriatrics specialist said he puts about 22,000 miles on his SUV each year traveling to see patients at their homes and in assisted living facilities around several towns in southwestern Michigan.

Getting about 19 miles per gallon, Dr. Elami would need to buy nearly 1,158 gallons of gas each year to visit patients. At old prices of about $2.20 per gallon that meant about $2,500. But with recent hikes sending the regional price to $3.40 per gallon, he might now need to spend nearly $4,000 per year on gas.

Combined with the increased winter heating bills he expects for the office he keeps, the difference could mean a couple thousand dollars. And while that doesn't seem like a large figure to everyone, the pinch will be noticeable for physician practices like his that have been squeezed by declining reimbursements.

"To be perfectly honest, if you add it up over the course of the year and think $4,000 versus $2,500, it's not that much money," Dr. Elami said. "But when it's the difference between $52 to fill versus $75 to fill in the long run, the way things are going, it is going to affect [my cash flow] a lot more."

"I'm not getting paid more for what I do, but I have to pay more for everything else. And I certainly have to factor this in," he added.

Constance Row, executive director of the American Academy of Home Care Physicians, said higher travel expenses threaten to make the field of home care less attractive to physicians, exacerbating a shortage of physicians who are willing to spend their time making house calls.

"None of the expenses that are associated with the travel component [get covered] and as a result the physicians are in a situation where a significant practice expense is not covered. It certainly has made it less attractive for physicians to make house calls," she said.

For Tom Cornwell, MD, the rising price at the pump potentially has significant consequences. The family physician spends his days driving around three counties in northern Illinois calling on patients at their homes. He tries to plan his visits in a way that makes sense geographically, but seeing 10 patients still might mean 50 miles in the car.

Like other home care physicians, Dr. Cornwell and his partners have felt the grip of financial pressures in recent years, and were forced to limit their services. Paying more at the gas pump adds insult to injury.

"We are already losing money, so anything that makes us lose more money is concerning. And with the looming Medicare cuts, it all affects the bottom line," he said. "We're not doing this to get rich. We really want to impact peoples' lives. It is a struggle. and anything that adds to our costs increases our struggle."

Higher costs for all

Even physicians who don't have to drive to see patients likely are noticing the difference thanks to prices that are nearly $2 more per gallon than they were a year ago and mark the highest prices AAA has recorded since it began conducting price surveys in 1974.

Geoff Sundstrom, an auto club spokesman, said the typical personal vehicle consumes about 600 gallons of gas per year, so at recent average prices most motorists will spend more than $1,500 on gas each year.

This figure, combined with expected spikes in home and office heating costs for the months ahead, could be a drain on household and practice-related expenses.

To help ease the burden, Sundstrom said consumers can start by finding simple ways to conserve energy and save on fuel such as keeping their cars properly maintained and removing excess weight from the vehicles. Additionally, switching to more fuel-efficient vehicles and energy-efficient home heating systems may produce noticeable savings.

But beyond help from changes such as those, most consumers will simply have to suck up the higher costs because of a reliance on energy.

"For most people, driving is a nondiscretionary activity," Sundstrom said. "They have to drive to and from work, they have kids they have to take to school. So they're much more likely to stop discretionary spending on other things to offset rising fuel prices."

If economists' predictions are correct, those spending changes may need to stay in place for a long while. Though many expect prices to moderate in coming months, there is also much speculation that prices could level off at a much higher level than historic norms.