April 07, 2020

Indicted ambulance service owner to close business

CALAIS – More than two dozen Washington County communities were left scrambling to replace ambulance service Thursday after the current provider announced operations would cease next week.

Months of uncertainty about the future of McGovern Ambulance Service came to an end when owner Dana McGovern announced that his business would close its doors at 4 p.m. on Dec. 7.

“McGovern Ambulance will be discussing the provision of regular ambulance service by another provider during the next week, and we are hopeful that a suitable arrangement may be obtained,” McGovern said in a Thursday afternoon press release. “Barring such an arrangement, ambulance service will be terminated on December 7, 2000.”

McGovern Ambulance serves 30 eastern Washington County communities from Wesley to Danforth and administers both the Pleasant River Ambulance Service in western Washington County and the Northern Washington-Southern Aroostook Regional Ambulance Service.

The decision to close the 9-year-old ambulance service comes less than two weeks after McGovern’s 214-count federal indictment on charges that he attempted to defraud Medicaid and Medicare of close to $1 million.

McGovern will be arraigned on those charges today in federal district court in Bangor.

Also, late Wednesday afternoon, McGovern filed an emergency petition in U.S. bankruptcy court seeking permission to reorganize his company.

McGovern’s attorney, Daniel Lacasse of Calais, said the bankruptcy petition was necessary to insure that the company had the equipment and payroll to continue operating through the next week. The filing prevents creditors from moving against McGovern Ambulance while the company attempts to reorganize, Lacasse said. Despite that attempt, however, Lacasse acknowledged that the firm doesn’t have enough funds to operate beyond Dec. 7.

The petition, which is a preliminary filing, estimates the number of company creitors to be between 50 and 99. Because of the format of the filings, estimated assets are listed in a range of between $100,001 and $500,000 and the estimated debt was listed in the same range.

Lacasse said he doesn’t have final figures, but is certain that the company’s assets are worth much more than $100,000 and that creditors are owed far less than half a million.

McGovern Manager Ham Robbins said he and other central office staff learned that McGovern had filed for reorganization bankruptcy at 5 p.m. Wednesday.

“It was a bit of a surprise to us here in the office,” Robbins said. “We’ve been living with a great deal of uncertainty, but we just kept forging ahead.”

Robbins said central office staff had been going over the books for weeks trying to find enough money to continue the service through the end of the year. Wednesday, it became apparent that there was only enough money to carry the company another week, but staff went over the books again on Thursday morning, he said.

“The major reason for picking Dec. 7 is that we’re unable to pay insurance on our vehicles and personnel after that date,” Robbins said. “The policies cancel at midnight.” Robbins characterized the company’s discussions with a replacement ambulance service as “very active,” but declined to identify the company other than to say it isn’t located in Washington County and that its operations are “further inland.”

“There’s a 98 percent chance that someone will be picking up the service very quickly, if not immediately,” Robbins said.

Most towns that have contracts with McGovern pay by the quarter, with the next payment due Jan. 1. The towns will lose that money that was to cover service between Dec. 7 and the end of the year, Robbins said.

Pleasant River Ambulance and Northern Washington-Southern Aroostook Regional Ambulance Service own their equipment and have their own staff, but will have to find someone other than McGovern to provide dispatching, bookkeeping, insurance and billing services, he said.

Robbins said McGovern Ambulance makes about 3,000 runs a year. About two thirds of those calls are non-emergency, such as transports between hospitals, he said. The company employees 90 people, 30 of whom are full-time. Som part-time staff work only occasionally, he said.

Calais interim city manager Jim Porter said Thursday’s announcement wasn’t unexpected, but is a big loss for Calais, both in terms of the company and the number of people who are losing their jobs.

Porter said Calais is pursuing a number of options including contracting with another ambulance company or operating it’s own service with rented equipment and city employees who are trained in emergency services.

Eastport City Manager George “Bud” Finch said the city has been working for several months with a number of other eastern Washington County towns to find an alternative to McGovern Ambulance.

The regional effort began in June when McGovern notified some Washington County towns that the company was raising its annual fees, Finch said.

“This has come a little sooner than expected, but we’re not going to leave people without emergency medical services,” he said. “We’re interested in working with anyone who can help us solve this problem.”

Lubec saw its contract fee with McGovern go from $14,760 to $91,000 as of July 1 and the town is actively pursuing its own ambulance service, according to Town Administrator Nancy Matthews.

“We have an urgent need grant application into the Community Development Block Grant program and we should have an answer on that by Dec. 7,” Matthews said. “We can have the equipment here, but what we need are volunteers.”

Matthews said the volunteers will be paid for training and when they go out on an ambulance run, but, to date, there aren’t enough people coming forward. Lubec responds to ambulance calls from Whiting and Trescott and residents of those communities need to become involved as well, she said.

Jay Bradshaw, the director of Maine Emergency Services – the state bureau that licenses ambulance services and ambulance personnel – said his bureau has been working with McGovern Ambulance and some of the affected communities since June.

Bradshaw said he is “saddened” by the news that the company is closing and Maine Emergency Services will work hard to remove any obstacles to getting a new service licensed as quickly as possible.

“Our role is to be a resource and to help put people in touch with each other,” he said. “But it is up to each community to decide what they want to do.”

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