Is EMS Recession Proof ?????

[crotchitymedic1986]

Recently had a conversation with an old friend who owns a private ambulance service (and a very profitable one), and we started talking about the US economy. He painted a very bleak picture for the ambulance industry in 2009. Although he has perfect credit, his lenders are telling him that he may have to delay scheduled purchases (ambulances) because the bank may not have the millions to loan him, that they normally do.

He went on to theorize that many private services would be going out of business in 09, because even if they have perfect credit, the bank may not be able to loan them the money, much like his situation; but the reality is, many services are barely getting by, and DO NOT have perfect credit, and will not be able to get a loan from any bank.

Many may not know that ambulance services rely on lines of credit to meet payroll, as Medicare and Medicaid reimbursements are unpredictable, but payroll comes every two weeks. From this conversation, I am going to make some predictions about 2009, but I hope they do not come true:

PREDICTIONS FOR 2009:

1. AMR will close its doors for good.

2. Many private services will go under, leaving 911 services to run non-emergencies.

3. Due to falling tax revenues secondary to home foreclosures (loss of revenue on those properties, and then the effect of foreclosures is that they drive down the values of homes around them, which again lessens the revenues into a municipality), many municipalities will have to cut back their Fire/EMS operations: Delaying equipment purchases, not filling vacant positions, offerring early retirement, witholding pay raises, running less trucks, or changing the schedule of trucks, or they may even have to lay-off employees.

4. The last remaining hospital-based services will also fold, there are very few hospitals making a profit at this time, and hospital-based EMS is usually a financial drain on the hospital.

5. Also note, that many municipalities are already over-levereged, and will not be able to float bonds as they usually do --- see California. If you are working for a major urban city or state, you should really be concerned.

I hope none of this happens, but if you are working for a municipality that is struggeling, or you work for AMR, a hospital-based provider, or a private service that is barely getting by now, you should really start thinking about a Plan-B. Which isnt to say that it is time to get out of EMS, but ask yourself, if my OT money dried up, could I pay my bills ? If the private service I work part-time at goes under, could I pay my bills ? If I work for AMR or a struggeling hospital, how would I survive if I were told that I would be out of work in two weeks ?

I think we are about to see some difficult times in our industry.

[spenac]

I made a topic on this about a month or two ago. Surprising some thought they were a required service so they felt job was secure. :roll:

[crotchitymedic1986]

I was one of the guilty ones, who thought a well-run EMS was recession-proof, but I am not so sure now.

[Richard B the EMT]

Nobody is recession proof, as even my own FDNY is trying to cut costs while not eliminating jobs.

The FDNY had announced they were going to "close" 4 engine companies between 6 PM and 9 AM. All of these (pumper) engine companies are both considered "low response call volume", and share quarters with a (ladder) truck company. The residents of the neighborhoods where these night time closures are to occur are understandably upset.

In support of one of these engine companies, they are in the newspapers this week, as, at 4 AM, some woman went into the water off of City Island in the Bronx, and the engine company that responded got her out successfully. If this company had already been closed for the overnight, it would have been at least 10 minutes for the next due engine to arrive. Speculation is, she would have died either of drowning or hypothermia had the engine not been there to respond.

(I will not be addressing WTF the woman was doing on a pier at that hour)

[HEAD inj]

well this is what I think will happen....First off , Most agencies are down in collections, Citys are hurting, If the fuel costs go up again most tax based services will be doing large cut backs....so the pvt. will have to pick up the slack so there will be a shift in 911 responce back to the pvt ambulances to do those calls so upper management needs to watch for this to happen here very shortly

[crotchitymedic1986]

only the best privates will survive with no credit to rely on, I think it is 911 that will have to start doing granny totes.

[spenac]

well this is what I think will happen....First off , Most agencies are down in collections, Citys are hurting, If the fuel costs go up again most tax based services will be doing large cut backs....so the pvt. will have to pick up the slack so there will be a shift in 911 responce back to the pvt ambulances to do those calls so upper management needs to watch for this to happen here very shortly

Actually privates will be hit hardest first. Plus privates can not survive transporting people with no ability to pay.

[Dustdevil]

PREDICTIONS FOR 2009:

1. AMR will close its doors for good.

Interesting to see someone else predicting this. I don't recall who it was, but I was speaking with someone in the chatroom just a couple of days ago and I made that very same prediction. They bit off way more than they can chew, and the cycle is about to conclude. And I am no AMR-hater, by any means. I'm just reading the writing on the wall.

4. The last remaining hospital-based services will also fold, there are very few hospitals making a profit at this time, and hospital-based EMS is usually a financial drain on the hospital.

Unfortunately, this is also something I have observed. I don't know the numbers regarding how many hospital-based systems there are today, and what kind of shape they are in. But just in my own local experience, I have witnessed the rise and fall of many hospital-based EMS systems in Texas, so it does seem to be a trend. On the other hand, I would think that there are many hospital-based systems that are well funded through an operational subsidy that allows them to operate without a loss. Then, of course, you have New Jersey, where without the hospital-based systems, there would be no paramedics at all. It would require major change in NJ for that to happen, and frankly, I don't think NJ is capable of change.

[mrmeaner]

First, anyone who believes that their job cannot be cut either works in the upper levels of government or is naive (although both are possible).

As with any type of company, the weak will fall with the declining economy (I don't know enough about AMR to say if they are weak or not). However, I think the rest of your predictions would require a very, very bad 2009 for that to happen. You do have some good points and I hope you are wrong, as I'm sure you do.

[Just Plain Ruff]

I do not see the last remaining hospital based ambulances closing.

I do see maybe a re-organization of services to decrease the number of staff.

Where I am now, we are hospital based. We have reorganized and are decreasing staffing. The ambulance and the ER have split into separate services for budgetary reasons and staffing reasons.

I don't see our hospital cutting back much more.

But those hospital based services who run maybe 2-3 calls in a 24 hour period I can see them being taken over or branching out to a combined service with another county.

It may be that we will do that too but I'm not to optimistic that will happen.

We've been hospital based for over 30 years and it's not going to change any time soon.

MAybe smaller hospital based services will close but in my opinion no private service can provide the services and people that we bring to the table. I'm pretty proud of where I work so I'm biased.