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Traveling doctors feel gas price pinch

Personal Finance. By Katherine Vogt, amednews staff. Sept. 19, 2005.

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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.