Should I charge for a dedicated van by the hour or per trip?

By the hour, day, or month. The facility is reserving a van and driver for its own use, so your costs run by the hour whether the van carries six riders or none. A per-trip price puts every slow day on you. When the rides are free to the facility's patients, the safe harbor at 42 CFR 1001.952(bb) also bars paying drivers or arrangers per beneficiary transported, which a block price avoids.

Do I have to pay the driver while the van sits at the facility?

Usually. A driver kept near the van for the next run is engaged to wait under 29 CFR 785.15, so the time counts as work. A gap stops counting as work only when the driver has no duties at all, knows when to report back, and has a long enough break to spend on personal business (785.16). Meal breaks follow the same logic: typically half an hour or longer, free of every duty, including watching the van (785.19).

What minimum should a dedicated van contract have?

Set it so the fixed costs are covered on a slow day. The van payment and insurance cost the same each month whatever the hours, so a facility that uses half the planned hours doubles their share of each hour. A daily minimum of half a shift, or a monthly minimum equal to the planned hours, keeps the rate you quoted intact.

Who insures a facility's van if my company only supplies the driver?

The facility's own auto policy comes first. Under the standard business auto form, coverage is primary for autos the policyholder owns, and anyone driving a covered auto with the owner's permission is an insured, so your driver is covered under the facility's policy. If your own policy covers non-owned autos, it sits behind as excess. Write down who pays for damage to the van.

Can a hospital run a free shuttle with my van?

Yes, if the shuttle fits the safe harbor. Under 42 CFR 1001.952(bb), a shuttle runs a set route on a set schedule, keeps every stop within 25 miles of a stop where care is given (75 miles for a rural stop), is advertised only by posting its route and schedule, and is paid for by the hospital without billing any payer or rider. Drivers cannot be paid per beneficiary carried.

Dedicated vehicle contracts: pricing a full-time van

In a dedicated vehicle contract, a facility stops buying trips and buys capacity: one van and one driver reserved for its use for set hours, paid by the hour, day, or month. The arrangement suits hospitals moving patients between campuses, senior living communities, day programs, and residential treatment centers, once their own rides fill most of a van’s day. The contract is simpler than per-trip work in one way, since the facility pays for the block whether the van is full or empty. It is harder in another, because every hour you quote has to carry the driver’s wage, the van’s cost, and the risk of a slow month. For per-trip facility accounts, start with how to get NEMT facility contracts.

When a dedicated van makes sense

A dedicated van fits when a facility’s rides would keep a van busy for most of a shift, at predictable times, from one base. Ask the facility for a month of its ride requests by hour of day. If most of them fall inside one weekday window, such as 8 a.m. to 3 p.m., and would fill several hours of driving, a reserved van can cost the facility less than paying per trip with wait charges, and it is steadier work for you.

The trade-off is control. With a dedicated van, the facility decides what the van does inside the block, and your earnings stop depending on how many trips you squeeze in. Track revenue per vehicle hour on the account to see whether the block rate beats what the same van would earn on per-trip work.

Why the facility pays for idle time

A dedicated driver is on the clock for the whole block, gaps included, so the facility’s rate has to pay for them. Under 29 CFR 785.15, a driver held near the van between runs is engaged to wait, which federal wage law counts as hours worked. The wait time guide explains where waiting stops counting as work. Inside a dedicated block that exception rarely applies, because the facility can call for the van at any moment.

The one gap that usually comes off the clock is a real meal break. Under 29 CFR 785.19, a bona fide meal period is ordinarily 30 minutes or more, and the driver must be free of every duty while eating. If lunch means sitting with the van or picking up dispatch calls, the driver is still on the clock. Take a meal break out of the paid hours only when the driver really gets one.

Long blocks bring overtime. Federal law sets 40 hours as the most an employee can work in a week before overtime starts (29 CFR 778.101), and overtime hours are paid at no less than time and a half of the regular rate (778.107). As an example, a van reserved from 7:30 a.m. to 6:00 p.m. on weekdays, with no unpaid meal break, is 52.5 hours a week. One driver on that van works 12.5 overtime hours, and at a $20 regular rate the overtime premium adds $125 a week. Either price the overtime into the rate or split the block between two drivers. The driver overtime guide covers regular-rate math and state daily overtime.

Building the hourly rate

Build the hourly rate from the bottom: the driver’s cost per paid hour, then the van’s fixed costs spread over the hours the facility commits to, then running costs, overhead, and margin. The figures below are assumed, for one wheelchair van reserved eight hours a day, 22 weekdays a month (176 hours):

Driver wage: $20.00 an hour. For scale, the May 2025 BLS wage survey puts the national median for its shuttle drivers and chauffeurs occupation at $17.93 an hour, with the 75th percentile at $21.97.
Social security and Medicare, employer share: $1.53. That is 7.65 percent of wages (6.2 percent social security, 1.45 percent Medicare) under IRS Publication 15 for 2026.
Paid leave, unemployment tax, and workers’ compensation: $2.50 (assumed).
Van payment: $8.52 (an assumed $1,500 a month over 176 hours).
Commercial auto insurance: $3.69 (an assumed $650 a month over 176 hours).
Fuel and maintenance: $5.50 (assumed).

That comes to $41.74 an hour. An assumed 15 percent for dispatch, the office, and a share of a spare van brings it to $48.00. To keep a 12 percent margin, divide by 0.88: about $54.55, so quote $55 an hour, or $9,680 for a 176-hour month. Run your own numbers through the driver cost calculator.

Notice which lines are fixed. The van payment and insurance cost the same each month. If the facility uses the van 88 hours instead of 176, those two lines rise from $12.21 to $24.43 an hour, and the $55 rate stops covering the van. That is the case for a minimum.

Minimum hours, overtime, and extra charges

The minimum protects the rate you quoted. Write the planned hours into the contract, then set what happens when the facility uses fewer or more:

Daily minimum. A floor for any day the van runs, such as half the scheduled shift, so a day with one early appointment still pays for the driver’s call-in.
Monthly minimum. Planned hours times the rate, billed even if use falls short, with credit for days you could not supply a van.
Hours past the block. A higher rate after the scheduled end time, covering the overtime you will owe.
Holidays and weekends. Either excluded or priced separately.
Rate reviews. A yearly adjustment tied to a price index. BLS advises using the U.S. City Average CPI in escalator clauses, calls seasonally adjusted figures inappropriate for them, and notes that annual adjustment is the most common interval.

Exclusive or shared van

Decide in writing whether the van is exclusive. An exclusive van serves only the facility during the block, can carry its name, and is billed for every hour. A shared van lets you use gaps for other customers, which supports a lower rate, but the facility will want its requests to come first and a promise about how fast the van returns.

Either way, say what happens when the van is in the shop. A dedicated contract needs a substitute vehicle of the same type, a time limit for getting it there, and whether the facility pays full rate for a substitute. Do the same for the driver: name the regular driver and the backup in the contract.

Who runs the schedule

Settle in writing who decides what the van does each day. Three models work:

The facility runs it. Facility staff hand the driver a daily list and add rides directly. Simple for the facility, but you lose sight of what the van is doing and when the driver can take a break.
Your dispatch runs it. The facility sends requests by a set cutoff, and your dispatcher builds the van’s day, including breaks and fuel stops.
Shared. Your dispatcher builds the day from requests made the day before, and the facility can add same-day rides when the van has room.

Whichever you choose, write down the request cutoff, how same-day changes are made, who handles a rider who isn’t ready, and the driver’s right to refuse a ride the van isn’t equipped for.

When the facility offers rides for free

When the facility gives patients or residents the rides at no charge, it will want the program to fit the federal safe harbor for free local transportation, 42 CFR 1001.952(bb). Fitting it is the facility’s job, but three of its conditions shape your contract. Drivers and anyone arranging the rides cannot be paid per beneficiary transported, which an hourly or monthly price satisfies. The facility must carry the cost itself, without passing it to any federal program, other payer, or the rider, so you cannot also bill Medicaid, a broker, or the passenger for those rides. And no one may market health care services during the rides.

Rides arranged for individual patients have their own limits on who qualifies and how far they go, covered in the anti-kickback guide. The second form of the safe harbor matters more for a dedicated van: the shuttle. The rule defines a shuttle as a vehicle that runs on a set route on a set schedule, and a shuttle does not have to limit riders to established patients. Every stop must be within 25 miles of a stop where care is given (75 miles for a rural stop), and the facility may post the route and timetable but not otherwise advertise it. A van looping between a hospital’s campuses on a fixed timetable can fit this form.

Insurance when a facility hires your van and driver

On a dedicated contract your business auto policy covers your van first, and the facility’s hired auto liability coverage, if it has any, sits behind it. ISO’s business auto coverage form (CA 00 01) makes a policy primary for autos the policyholder owns and excess for autos it does not own. It also counts anyone liable for the conduct of an insured as an insured, up to the amount of that liability, which reaches a facility held responsible for your driver. Since the facility is already an insured through that wording, many insurers decline to add it as an additional insured on an auto policy and attach the designated insured endorsement (CA 20 48) in its place. Ask the facility early whether it accepts that.

Two more points from the same form matter here. The facility’s hired auto physical damage coverage does not apply to a vehicle hired with a driver, so damage to your van falls on you and your own physical damage coverage. And when the facility owns the van and you supply only the driver, the order flips: the facility’s policy is primary for its own van, your driver counts as an insured while driving it with the facility’s permission, and your policy, if it covers non-owned autos, is excess. The glossary entry on hired and non-owned auto coverage explains that part of a policy.

What to add to the agreement for a dedicated van

The facility transportation agreement template covers the general terms. For a dedicated van, add:

The days, hours, and vehicle type reserved for the facility, and whether the van is exclusive.
The hourly, daily, or monthly rate, the minimums, and the rate after the scheduled hours.
Substitute vehicle and backup driver, with a time limit.
Who builds the daily schedule, the request cutoff, and same-day changes.
Whether riders pay nothing for the rides, and the facility’s written promise that it covers them itself.
Insurance limits, how the facility is named on your policies, and who covers a facility-owned van.
A monthly invoice showing hours reserved, hours used, and any extra hours.
The annual rate review and the notice period for ending the contract.

Running a dedicated van in HealthRide

A dedicated van is easiest to bill when the hours are already on record. In HealthRide, the van’s driver works a set shift on the board, the facility can request rides from its own portal, and the timecard report shows each driver’s hours on duty for the month. See reports.

Dedicated vehicle contracts with facilities: pricing a full-time van, minimum hours, and who runs the schedule