Want to provide emergency medical services? Here's the detailed budget.

emergency medical service (EMS) profitability

What's the cost of establishing an emergency medical service (EMS) organization? What are the core expenses to focus on? Can you start with a limited budget, and are there any costs to skip?

This guide will provide you with essential information to assess how much it really takes to embark on this journey.

And if you need more detailed information please check our business plan for an emergency medical service (EMS) organization and financial plan for an emergency medical service (EMS) organization.

How much does it cost to provide emergency medical services?

What is the average budget?

On average, starting an emergency medical service (EMS) organization can require an investment ranging from $100,000 to $1 million or more.

Let's break down what impacts this budget the most.

The type of EMS service offered is a major cost determinant. For instance, a basic life support (BLS) service will cost less compared to an advanced life support (ALS) service, which requires more specialized equipment and trained personnel.

Equipment such as ambulances, medical supplies, and communication devices represent significant expenses. An ambulance can cost between $50,000 to $200,000 or more, depending on its capabilities. Medical equipment like defibrillators, stretchers, and oxygen tanks can add tens of thousands to the budget.

Additionally, the location of the EMS organization affects costs. Operating in a metropolitan area may incur higher expenses due to higher property and operation costs compared to a rural setting.

Training and salaries for qualified personnel such as paramedics and EMTs also contribute significantly to the budget. These costs vary depending on the level of expertise and the number of staff required.

Insurance and liability coverage are essential for an EMS organization and can be costly, depending on the coverage level.

Licensing and certification fees, which vary by region and service type, are also necessary expenses to operate legally.

Can you start an EMS organization with minimal funding?

Yes, but it requires a strategic approach. Let's discuss the very minimum to start an EMS organization and how it would look.

Starting with a single ambulance service focusing on basic life support can reduce initial costs. Opting for a used ambulance in good condition could cost around $20,000 to $50,000.

Investing in essential medical equipment and minimizing advanced life support tools can keep the budget within $30,000 to $70,000.

Operating from a modest facility or sharing space with another healthcare provider can save on rent and utilities, potentially reducing costs to a few thousand dollars monthly.

Hiring a small, skilled team and offering training can balance personnel costs. Salary and training expenses might range from $40,000 to $100,000 annually, depending on the team's size and qualifications.

For marketing and community outreach, using social media and local partnerships can be a cost-effective strategy, requiring only a few hundred dollars.

In this minimal scenario, the initial investment could range from $100,000 to $250,000.

This approach may limit the scope of services and operational capacity. As the organization grows, reinvesting profits can fund expansion and enhance capabilities.

Finally, if you want to determine your exact starting budget, along with a comprehensive list of expenses customized to your project, you can use the financial plan for an emergency medical service (EMS) organization.

business plan ambulance service

What are the expenses to provide emergency medical services?

Please note that you can access a detailed breakdown of all these expenses and also customize them for your own project in the financial plan for an emergency medical service (EMS) organization.

The expenses related to the location of your emergency medical service (EMS) organization

Should an EMS organization have a physical location from the start?

Starting an Emergency Medical Service (EMS) organization involves deciding whether to establish a physical base or operate primarily mobile units. This choice impacts various aspects of the service, from operational efficiency to community presence.

Having a physical base offers several benefits. It provides a central hub for staff, equipment, and administration, which can streamline operations. A physical location also establishes a tangible presence in the community, potentially fostering trust and familiarity. Furthermore, it can serve as a training and coordination center for EMS personnel.

However, there are drawbacks to maintaining a physical location. The costs for renting or purchasing a space, along with ongoing expenses like utilities and maintenance, can be significant. A fixed location also might limit the service's reach, as resources are concentrated in one area.

Conversely, a mobile-focused EMS organization prioritizes ambulance and emergency units over a central office. This approach can increase response flexibility and reduce overhead costs related to property management. However, it may face challenges in areas like staff coordination, equipment storage, and establishing a community presence.

Below is a summary table comparing these two approaches.

Aspect Physical Base Mobile-First Approach
Central Coordination āœ”ļø šŸš«
Community Presence āœ”ļø šŸš«
Equipment Storage āœ”ļø šŸš«
Training Facility āœ”ļø šŸš«
Higher Costs āœ”ļø šŸš«
Response Flexibility šŸš« āœ”ļø
Initial Investment āœ”ļø šŸš«
Operational Efficiency āœ”ļø šŸš«
Wider Service Area šŸš« āœ”ļø
Lower Overhead šŸš« āœ”ļø
Community Trust āœ”ļø šŸš«
Staff Collaboration āœ”ļø šŸš«

If you decide to rent the space for your EMS organization

Estimated budget: between $2,000 and $7,000

Renting a space for an EMS organization typically involves higher costs than other businesses due to requirements for space and accessibility. Costs include security deposits and the first month's rent.

Security deposits usually amount to one or two months' rent. For a monthly rent of $700, anticipate an initial outlay of $2,100, covering the deposit and first three months' rent.

Understanding the lease terms, including duration and conditions for rent increases, is crucial. Legal consultation for lease agreements may cost between $500 and $1,000.

Real estate broker fees, if applicable, are often covered by the landlord.

If you decide to buy the space for your EMS organization

Estimated budget: between $75,000 and $500,000

Purchasing property for an EMS organization varies greatly based on location, size, and facility needs. Prices can range from $40,000 (for smaller, rural facilities) to $250,000 (for larger, urban centers).

Closing costs, including legal fees, title searches, and loan fees, range from $3,500 to $20,000.

Renovation costs, particularly for medical facilities, should be allocated at about 15-20% of the purchase price, or between $11,250 and $100,000.

Professional assessments may cost up to $5,000.

Property taxes and insurance are also significant, with taxes ranging from 2% to 10% of the property value, and insurance costs varying widely based on location and facility size.

Equipments, furniture and interior design

Estimated Budget: at least $150,000

For an emergency medical service (EMS) organization, your primary investment should be in ambulances and medical equipment. The effectiveness of your service largely hinges on the reliability and capability of these assets.

Standard ambulances, equipped with essential life-saving equipment, can cost between $50,000 to $120,000 each. The price varies depending on the vehicle's size and the complexity of medical equipment installed. For a more advanced setup, such as a Critical Care Transport ambulance, prices can rise to $150,000 or more.

Inside the ambulance, critical equipment includes heart monitors/defibrillators, which can range from $10,000 to $30,000 each, and ventilators costing between $5,000 and $15,000. The high cost of these devices is justified by their crucial role in patient care and survival.

Other necessary equipment includes stretchers, costing approximately $2,000 to $10,000, depending on their features and durability. Oxygen delivery systems, vital for respiratory support, can range from $1,000 to $3,000. Investing in high-quality stretchers and oxygen systems ensures patient safety and comfort during transport.

For drug storage and administration, a secured drug safe and medical supplies (like IV kits, bandages, and medications) are essential. A good drug safe may cost around $500 to $2,000. The initial stock of medical supplies might add another $2,000 to $5,000 to your budget, varying with the range of services offered.

Communication equipment, crucial for coordinating with hospitals and other emergency services, includes radios and GPS systems. A set of advanced communication devices may cost between $1,000 to $5,000.

Now, for some optional but beneficial additions.

A power load system for stretchers, costing about $10,000 to $20,000, can significantly reduce the risk of injury to staff by automating the lifting and lowering of patients. While expensive, it can be a worthwhile investment in staff safety and efficiency.

Investing in additional medical devices like portable ultrasound machines (around $20,000 to $50,000) or specialized trauma kits (around $500 to $2,000) can enhance your service's capability but are not immediately essential.

In prioritizing your budget, focus on reliable ambulances and essential life-saving equipment like defibrillators and ventilators. These are the backbone of your operations and critical for patient care.

Opt for quality and reliability in these to minimize downtime and costly repairs. For other items like stretchers and communication equipment, good mid-range options can be sufficient. However, beware of the cheapest options as they may lead to higher maintenance costs and decreased reliability.

Starting an EMS organization requires balancing your budget with the quality and capability of equipment. It's often better to start with essential, high-quality items and then expand your equipment list as your service grows and generates revenue.

Category Estimated Cost
Primary Investments at least $150,000
Ambulances $50,000 - $150,000+
Heart Monitors/Defibrillators $10,000 - $30,000
Ventilators $5,000 - $15,000
Stretchers $2,000 - $10,000
Oxygen Systems $1,000 - $3,000
Drug Safe $500 - $2,000
Medical Supplies $2,000 - $5,000
Communication Equipment $1,000 - $5,000
Optional Additions Varies
Power Load System $10,000 - $20,000
Additional Medical Devices Varies
business plan emergency medical service (EMS) organization

Marketing, Branding and Communication

Estimated Budget: $20,000 to $50,000 for the first months of operation

In the critical arena of emergency medical services (EMS), branding, marketing, and communication are not just beneficial, they are essential for public awareness and trust.

Branding for an EMS organization is about embedding trust and professionalism into every aspect of your service. It's more than the emblem on the vehicles or the uniforms of the paramedics. It's about the assurance of quality care, the speed and efficiency of your response, and the competence and compassion in every life-saving action taken.

Do you want your EMS to be perceived as cutting-edge and technologically advanced, or community-focused and nurturing? This branding identity influences everything from the design of your ambulances to the tone of voice in your community outreach programs.

Marketing for an EMS is your lifeline to the community, informing them about the essential services you provide. People don't seek out EMS services casually. Your marketing efforts need to educate the public about when and how to call for help, and the critical role you play in emergency healthcare.

Effective marketing for an EMS might involve informative posts on social media about first aid tips, community engagement through health fairs, or partnerships with local organizations for emergency preparedness workshops. A strong online presence is important too, ensuring that when someone searches for "emergency medical services near me," your organization appears first.

However, avoid overextending your budget with broad, non-targeted campaigns. Focus on building a strong connection with your local community and healthcare providers.

Communication in EMS is crucial. It involves not only the interaction with patients during emergencies but also the ongoing dialogue with the community. Whether it's through educational programs, feedback surveys, or regular updates about your services, effective communication builds trust and reassures the community about your readiness and competence.

For an EMS organization, the marketing budget is a significant portion of your operating costs, typically around 5% to 15%. As a new service, investing more initially to establish your presence and gain trust is advisable.

Allocate your budget wisely. Invest in high-quality training videos, a robust and informative website, community outreach programs, and perhaps public awareness campaigns. It's important to adjust your budget as your service grows, focusing more on areas that increase community engagement and public trust.

Remember, in EMS, successful branding and marketing can mean the difference between life and death. It's not just about being known, it's about being trusted and relied upon in emergencies.

business plan ambulance service

Staffing and Management

Estimated Budget: $50,000 - $100,000 for the first month

When opening an emergency medical service (EMS) organization, staffing is a critical component and requires substantial investment, particularly due to the specialized nature of the roles involved.

Let's delve into the essentials.

Running an EMS operation is a complex task that demands a diverse team of highly trained professionals. It includes paramedics and emergency medical technicians (EMTs) who are on the front lines, providing lifesaving care. Additionally, a support team is needed for operations management, dispatch, and logistics.

Key positions in an EMS include paramedics and EMTs, who are essential from day one. Their expertise and rapid response capabilities are the backbone of your service. You will also need dispatchers who coordinate the emergency calls and manage the logistics of sending units to the scene. For larger operations, a fleet manager to maintain vehicles and equipment is crucial.

As your EMS organization expands, roles such as administrative staff, HR personnel, and specialized medical staff, like advanced life support technicians, may become necessary. These roles typically emerge as the demand for your services grows and your operational complexity increases.

Regarding compensation, EMS professionals should be paid competitively from the start. Delaying compensation can negatively impact morale and retention in a field where skilled professionals are in high demand.

Beyond salaries, budget for additional expenses such as taxes, insurance, workers' compensation, and benefits, which can increase total staffing costs by 20-30% above base salaries.

Training and continuous education are vital in the EMS field. Initial training might include advanced medical protocols, emergency response techniques, and equipment handling. Ongoing education is also necessary to keep staff updated with the latest medical advancements and compliance requirements. Budgeting several thousand dollars for initial and ongoing training is advisable.

This investment not only ensures compliance with health and safety regulations but also elevates the quality of care provided, ultimately enhancing the reputation and reliability of your EMS organization.

Job Position Average Salary Range (USD)
Emergency Medical Technician (EMT) $30,000 - $45,000
Paramedic $40,000 - $60,000
EMS Dispatcher $28,000 - $42,000
EMS Supervisor $50,000 - $75,000
Flight Paramedic $60,000 - $80,000
Emergency Physician $150,000 - $300,000
EMS Director $80,000 - $120,000

Please note that you can access a detailed breakdown of all these expenses and also customize them for your own project in the financial plan for an emergency medical service (EMS) organization.

Professional Services

Starting with a lawyer, for an emergency medical service (EMS) organization, the focus is beyond basic business setup.

A lawyer will be instrumental in guiding you through the specific regulations and compliance standards necessary in the healthcare sector, such as HIPAA compliance for patient data protection and employment laws related to medical staff. They can also assist in drafting contracts with hospitals, insurance companies, and local government entities. Expect to spend approximately $3,000 to $7,000 initially for these specialized legal services.

Consultants for EMS organizations are invaluable, especially for those new to the healthcare sector.

They offer expertise in areas such as ambulance fleet management, emergency response protocols, and efficient patient care systems. They can also guide you on securing certifications and meeting state and federal emergency health standards. The cost for a healthcare industry consultant might range from $100 to $300 per hour.

Banking services for an EMS organization are crucial for handling large transactions and funding for expensive medical equipment and ambulances. Besides a business account and loans, you'll need to consider the cost of financing for specialized vehicles and medical technology. Interest rates and fees will vary based on the bank and the scale of your operation.

Insurance for an EMS is critical and must cover specific risks such as medical malpractice, vehicular accidents, and worker's compensation. Given the high-risk nature of EMS operations, insurance costs can be substantial, potentially ranging from $5,000 to $15,000 annually, depending on the coverage and size of the organization.

Additionally, EMS organizations have ongoing costs for certifications and training. This includes regular staff training in life-saving techniques, equipment use, and compliance with healthcare regulations. These are not one-time expenses; continuous investment in training and certification is essential for maintaining operational standards and ensuring the safety of both staff and patients.

Service Description Estimated Cost
Legal Services Guidance on healthcare regulations, HIPAA compliance, contracts with hospitals, insurance companies, and local governments. $3,000 - $7,000 initially
Consultancy Expertise in ambulance management, emergency protocols, patient care systems, certifications, and health standards. $100 - $300 per hour
Banking Services Handling large transactions, funding for medical equipment and ambulances, business accounts, and loans. Varies
Insurance Coverage for medical malpractice, accidents, and worker's compensation. $5,000 - $15,000 annually
Certifications and Training Regular staff training in life-saving techniques, equipment use, and healthcare compliance. Ongoing cost

Ongoing Emergency Funds

Estimated Budget: $100,000 to $500,000

When you're establishing an Emergency Medical Service (EMS) organization, creating an emergency fund is absolutely essential.

Think of it as a lifeline when you're navigating the unpredictable challenges of providing critical medical care. You hope you won't need it, but it's indispensable for your peace of mind and the security of your EMS operations.

The specific amount you should allocate for your emergency fund can vary based on the scale and location of your EMS organization. However, a general rule of thumb is to have enough to cover at least 3 to 6 months of your operating expenses. In the context of EMS, this typically translates to a range of $100,000 to $500,000.

It's crucial to keep in mind that these figures can fluctuate significantly based on factors such as equipment maintenance, fuel costs, personnel salaries, medical supplies, and vehicle maintenance.

One of the primary reasons for maintaining this fund is the inherent unpredictability in the field of emergency medical services. You may encounter unexpected costs, such as vehicle repairs, replacement of medical equipment, or fluctuations in demand for your services. These situations can have a profound impact on your cash flow if you're not adequately prepared.

To mitigate these potential challenges, it's not sufficient to merely create an emergency fund; you must also focus on efficient financial management.

For example, overstaffing or underestimating demand for your services can lead to financial inefficiencies or missed opportunities. Regularly assessing and adjusting your resources and services based on community needs and response data is vital to avoid these pitfalls.

Furthermore, building strong relationships with your suppliers and medical equipment providers is crucial. They may be willing to offer favorable terms or discounts, which can help alleviate financial pressures during challenging periods.

Another key aspect is maintaining rigorous financial oversight of your EMS operations. Regularly reviewing your financial statements enables you to identify trends and address potential issues before they become substantial financial burdens.

Additionally, consider diversifying your revenue streams by offering training programs or public education initiatives related to emergency medical care. This can provide a more stable income source for your organization.

Lastly, never underestimate the significance of providing top-notch patient care and engaging with your local community. Satisfied patients and community partnerships can lead to strong support, referrals, and a steady source of revenue for your EMS organization.

Please note that you can access a detailed breakdown of all these expenses and also customize them for your own project in the financial plan for an emergency medical service (EMS) organization.

business plan emergency medical service (EMS) organization

What items can EMS organizations typically overspend on?

Managing expenses wisely is crucial for the success of your emergency medical service (EMS) organization.

Some costs can be unnecessary, others may be overspent on, and certain expenses can be delayed until your EMS organization is more established.

First and foremost, let's talk about unnecessary costs.

A common mistake in EMS organizations is overspending on state-of-the-art medical equipment right from the start. While having advanced equipment is important, it's essential to balance this with the actual needs of your service area. Opt for reliable, standard equipment initially, and upgrade as your service grows and your budget allows.

Another area for cost savings is in marketing. In today's world, there are more cost-effective ways to promote your EMS services.

Instead of costly traditional advertising methods, consider leveraging social media, developing a user-friendly website, and engaging in community outreach programs. These strategies can effectively raise awareness about your services without a hefty price tag.

Now, let's discuss expenses that EMS organizations often overspend on.

Stocking excessive medical supplies is a common issue. It's crucial to understand the demand and shelf life of medical supplies to avoid wastage and overstocking. Begin with essential supplies based on common emergencies in your area and adjust your inventory as you learn more about local needs.

Also, be mindful of staffing levels. While it's important to have enough trained personnel to provide timely and effective services, overstaffing can lead to unnecessary labor costs. Start with a core team of skilled professionals and expand your staff as demand for your services grows.

When it comes to delaying expenses, consider holding off on expanding your fleet of ambulances or upgrading to larger facilities. It's tempting to grow your physical assets quickly, but it's wiser to wait until you have a stable and growing demand for your services. Expanding too early can lead to financial strain and operational inefficiencies.

Another cost that can be delayed is the investment in advanced training programs and specialized equipment. Begin with essential training and equipment, then gradually invest in more specialized assets as your team gains experience and your organization's reputation grows.

Examples of startup budgets for emergency medical service (EMS) organizations

To assist in understanding the financial requirements for starting an emergency medical service (EMS) organization, let's explore the budget for three different types of EMS setups: a basic rural EMS service with minimal equipment, a standard urban EMS service with a moderate range of equipment and facilities, and a comprehensive EMS service with advanced equipment and capabilities.

Basic Rural EMS Service with Minimal Equipment

Total Budget Estimate: $50,000 - $80,000

Category Budget Allocation Example of Expenses
Equipment (Basic) $20,000 - $30,000 Basic life support equipment, stretchers, basic medical supplies
Vehicle (Second-Hand Ambulance) $15,000 - $25,000 Used ambulance, minor refurbishments
Training and Certifications $5,000 - $10,000 EMT training, CPR certifications, other essential training
Permits and Licenses $2,000 - $5,000 Health department permits, business license
Insurance and Legal $3,000 - $5,000 Liability insurance, legal consultations
Miscellaneous/Contingency $5,000 - $10,000 Unforeseen expenses, small equipment, uniforms

Standard Urban EMS Service

Total Budget Estimate: $100,000 - $150,000

Category Budget Allocation Example of Expenses
Equipment (Enhanced) $40,000 - $60,000 Advanced life support equipment, defibrillators, oxygen systems
Vehicle (New Ambulance) $50,000 - $70,000 New ambulance, equipped with essential EMS tools
Training and Certifications $10,000 - $15,000 Advanced EMT training, specialized medical certifications
Permits and Licenses $5,000 - $10,000 State and local permits, operational licenses
Insurance and Legal $8,000 - $12,000 Comprehensive liability insurance, legal retainer for compliance
Marketing and Outreach $5,000 - $10,000 Community outreach programs, online presence, promotional materials
Miscellaneous/Contingency $10,000 - $20,000 Emergency fund, additional medical supplies

Comprehensive EMS Service with Advanced Equipment

Total Budget Estimate: $200,000 - $300,000

Category Budget Allocation Example of Expenses
Equipment (State-of-the-Art) $80,000 - $120,000 High-tech medical equipment, telemedicine capabilities, advanced life support tools
Vehicles (Multiple, Advanced Ambulances) $100,000 - $150,000 Fleet of new, fully-equipped ambulances
Training and Certifications $20,000 - $30,000 Comprehensive medical and emergency response training, ongoing education
Permits and Licenses $10,000 - $15,000 Extensive regulatory compliance, specialized operational licenses
Insurance and Legal $15,000 - $20,000 High coverage insurance, legal advisory for complex compliance issues
Marketing and Branding $10,000 - $20,000 Professional marketing campaign, community engagement initiatives
Miscellaneous/Contingency $20,000 - $40,000 Contingency funds for unforeseen circumstances, advanced medical supplies
business plan emergency medical service (EMS) organization

How to secure enough funding to provide emergency medical services?

Securing enough funding for an emergency medical service (EMS) organization requires a strategic approach, considering the unique aspects of this type of business.

EMS organizations often rely on a combination of personal savings, loans from banks, and possibly government grants or subsidies. The reason for this is that EMS, being a critical service, might not typically attract traditional business investors like venture capitalists, who often look for high-growth, scalable businesses.

Grants and subsidies are more common in the EMS sector compared to some other businesses due to the essential nature of the services provided. These grants might be specifically aimed at healthcare, public safety, or community services.

In terms of securing a loan from a bank or obtaining grants, having a comprehensive business plan is crucial. This plan should detail financial projections, a market analysis, the unique value proposition of your EMS organization (what sets it apart from others), and a clear operational plan.

Demonstrating a thorough understanding of the EMS market, including demand, competition, and regulatory environment, is vital. Banks, grant committees, and other potential funders will want to see a well-thought-out plan for revenues, expenses, and cash flow management. They will also look for evidence of your commitment and capability to run the organization effectively, which could be demonstrated through your experience in the field or collaborations with experienced healthcare or emergency services professionals.

Regarding the percentage of the total startup budget you should contribute, it often helps to have about 20-30% of the initial funding. This shows your commitment to the project and can make securing additional funds easier. However, for an EMS organization, there might be more flexibility in this requirement due to the essential nature of the service and potential access to specialized funding sources.

The timing of securing your funds is critical. Obtaining financing several months before operations begin ā€” ideally around 6 months ā€” allows time for setting up operations, purchasing equipment, hiring staff, and managing other pre-launch expenses.

Expecting to be cash flow positive from the first month of operations is optimistic for most new businesses, including an EMS organization. It is wise to reserve about 20-25% of your total startup budget as working capital to cover operating expenses for the first few months until the business starts generating consistent revenue.

You might also want to read our dedicated article related to the profitability of an emergency medical service (EMS) organization.

How to use the financial plan for your ambulance service?

Many aspiring EMS organization founders struggle with presenting their ideas in a coherent and professionally appealing manner to investors or lenders. This often leads to missed opportunities in securing vital funding.

To turn your vision of starting an EMS organization into a reality, gaining the trust and confidence of potential investors or lenders is key. A critical step in this process is presenting them with a well-structured business and financial plan.

We have developed a user-friendly financial plan, specially designed for the unique needs of EMS business models. This plan includes financial projections for a three-year period.

Our plan covers all the critical financial statements and ratios necessary for a comprehensive understanding of the business's potential ā€“ including income statements, cash flow projections, break-even analysis, and a provisional balance sheet. We provide pre-filled data which covers a wide range of possible expenses, tailored to the EMS sector. You can easily adjust these figures to align perfectly with your specific project.

This financial plan is not only compatible with loan applications but is also extremely beginner-friendly. It requires no prior financial expertise. All calculations and formulations are automated ā€“ you simply input your data and make selections. We've streamlined the process to ensure it's accessible to all, regardless of your familiarity with financial planning tools like Excel.

If you face any difficulties or have questions, our team is available to provide assistance and support, free of charge. With our plan, you'll be equipped to present a convincing and professional proposal to your prospective funders, enhancing your chances of securing the necessary funding for your EMS organization.

business plan ambulance service

The content provided here is for informational purposes only and does not imply endorsement. While we strive for accuracy, we do not guarantee the completeness or reliability of the information, including text, images, links, or other elements in this material. Following the advice or strategies presented here does not assure specific outcomes. For guidance tailored to your individual circumstances, it is recommended to consult with a professional, such as a lawyer, accountant, or business advisor.

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