Medical transportation companies can help people get to medical centers and meetings. Due to an older population and a greater need for medical transportation, the global non-emergency medical transport business is expected to grow by more than 40% by 2028.
Starting a healthcare transportation service could be a great way for you to help people while still making a living. But before you hit the road, you must first learn how to start and run a business.
This step-by-step guide has all of the information you need to start building a profitable medical transportation business.
Step 1: Find Out if this is the Right Business for You?
To be clear, the business in question is a non-emergency medical transportation (NEMT) service. An ambulance, which is sometimes called an emergency medical delivery company, is a totally different service that requires a lot of medical knowledge.
There are pros and cons to think about before deciding to start a medical transportation service.
Positives Vs Negatives
| Essential Service: Do something of great value for people who are in need. Flexible: You can run your business from home. Earn good money by charging base rates plus travel costs. | Wheelchair-accessible cars or buses are expensive. Lots of waiting—Spend a lot of time waiting for clients and meetings. |
Industry Trends
- The worldwide non-emergency medical travel market will be worth almost $8.1 billion in 2022, up from 7% the year before.
- The non-emergency medical transportation market is expected to grow by 40% worldwide by 2028.
Cost of Starting Medical Transportation Business
Medical transportation companies can help people get to medical centers and meetings. Due to an older population and a greater need for medical transportation, the global non-emergency medical transport business is expected to grow by more than 40% by 2028.
Starting a healthcare transportation service could be a great way for you to help people while still making a living. But before you hit the road, you must first learn how to start and run a business.
Investment Items:
- Vans or other vehicles with ramps for wheelchairs
- First aid kits
Is Medical Transportation Business Profitable?
Medical transportation costs $5 per mile on top of the standard fee of $40, so you can make $75 per trip. Medical transportation brokers, who arrange payment terms with insurance companies in exchange for a fee, are likely to get your business. When working alone, your profit margin should be around 80% after you take out the cost of gas.
In your first year or two, you might make 20 trips a week and make $78,000 a year. Taking the 80% edge, this would amount to a $62,000 gain. As your customer base grows, you may need to make 70 trips every week. At this point, you would hire more people and buy more cars, dropping your profit margin to around 30%.
With a yearly income of $273k, you would make a nice profit of $82k.
Entry Barriers
- Cost of a car that can be accessed by a wheelchair
- Meeting your state’s license and certification standards
Step 2: Create a Strategy
Identify a Gap
Check out the services, prices, and customer reviews of medical transportation companies in your area and online. You want to fill a need in the market. For example, there may not be enough NEMT services for Medicaid recipients or NEMT companies that work with a certain long-term care center on the local market.
This could get people talking about you again and bring you new business right away.
Solutions
You will be able to drive patients to and from medical visits, long-term care homes, and other medical facilities. You could also test for COVID and give medications.
Pricing
In addition to the normal charge of $40 per trip, hospital transportation costs about $5 per mile. After gas and exchange fees, you should try to make a profit margin of 80%.
Once you know how much you’re spending, you can use our Step-by-Step profit margin tool to figure out your rate and final price points. Keep in mind that your shipping prices should be able to change when the market calls for it.
Target Market
Your target market will include transportation providers, places for older people to live, and people who need help. You can get in touch with agents and houses through LinkedIn or call them after finding them on Google or Yelp.
Location
You might decide to start your business from home to save money. But as your business grows, you may need to rent an office area and hire people for different jobs. You can find local office space for sale on Craigslist, Crexi, and Instant Offices.
When looking for a place for your business, keep these things in mind:
- The place is convenient and easy to get to with public transportation.
- The place is big, bright, and has good air flow.
- As your business grows, you can continue the lease.
- It works perfectly and doesn’t need any big fixes.
Step 3: Write a Business Plan
A strategy is essential for any organization. This will assist you in guiding your new firm through the launch process while keeping your major goals in mind. A business plan also assists potential partners and investors in better understanding your company and its goals:
Following the completion of the plan, a brief overview of the entire marketing strategy should be created.
- Business Outline: An overview of the business, its vision, mission, ownership, and objectives.
- Services and Products: Describe your services in detail.
- Analyses of rivals: Create a list of the benefits of your services by analyzing the strengths and shortcomings of your primary rivals.
- Marketing and sales: Analyze your company’s unique selling propositions (USPs) to develop sales, marketing, and promotion tactics.
- Supervisory team: Outline of the supervisory team, detailing their roles and expertise, coupled with a corporate order.
- Plan of Operations: This section includes your company’s operational plan’s procurement, office location, critical assets and equipment, and other logistical data.
- Plan for finances: Three years of financial planning, covering initial expenses, return on investment analysis, benefit and loss gauges, income, and accounting report.
- Appendix: Include any additional documents pertaining to business or finances.
Step 4: Create a Marketing Plan
Some of your business will come from people who walk by or find you online, but you should still spend money on advertising. For new businesses, getting the word out is especially important because it will bring in more customers and raise brand recognition.
Connect your website to your social media accounts once it’s done. Social media is a great way to promote your business because you can post fun updates and sell your goods.
- Facebook is a great place for paid ads because it lets you target specific groups, like guys under 50 in the Cleveland area.
- Instagram has the same benefits as Facebook, but it is used by a different group of people.
- Website: Search engine optimization (SEO) will help your website rank higher in appropriate search results, which is a key part of making more sales. Check your website for clear calls to action. Changing the size, color, and placement of calls to action like “Book Now” could bring in a lot more customers.
- Google and Yelp: Putting your business on Yelp and Google My Business can help people find you and buy from you.
- In-Person Sales: Tell transportation agents about your medical transportation services.
- Email promotion/bulletin: Send regular messages to customers and potential clients. Make them special to you.
- Start a blog and update it often. Change up your content and send it out through many platforms.
- People who bring in new customers should be paid.
- Paid social media ads: Choose sites where your target audience hangs out and run ads that are relevant to them there.
- Pay-per-click marketing (PPC): You can improve your search engine results by using Google AdWords. First, find out as much as you can about your keywords.
- Testimonials: Talk about how your medical transportation services helped happy customers.