Ambulance authority struggles with difficult financial problems

Operating an effective ambulance service is not an inexpensive undertaking, particularly when that service covers an area with a limited and declining population. It is simple economics: operating costs do not go down when the number of people served declines. The cost per person, in fact, increases. At the July meeting of the Washington County Emergency Medical Services Authority (WCEMSA) concerns were raised about the long-term viability of the authority because of delays in payment by MaineCare, Medicare and insurance companies and increased operating costs.
Lubec is considering the option of operating its own ambulance service. This possibility was confirmed on August 2 by William Daye, chair of the selectmen, at the Lubec town meeting.
Earl Small from Eastport, who served as an interim director of the authority in 2009 and has continued to assist the board, says Eastport is "examining all options." If such an action is taken by either municipality, the cost-per-capita is an open question. However, it will likely rise, according to Daye and others. If the ambulance authority should stop service, hard questions would arise about service to towns such as Meddybemps with a population of 162 or Crawford with a population of 112.
Training and licensing needed to maintain a legal ambulance service by administering emergency medications and billing MaineCare, Medicaid and private insurance companies are costly. As those costs continue to rise, they effectively eliminate volunteer squads. Add to that the cost of acquiring and maintaining the vehicle itself, providing a ready staff and replenishing medical supplies and fuel, and the plight of the WCEMSA becomes apparent. Current funding methods were established before the City of Calais withdrew from the group, which resulted in diminished call volume and burdening the remaining municipalities with the long-term debt. This has led to a situation where the service operates in a deficit mode. According to Small, the deficit is "between $120,000 and $140,000 annually."
Meeting on July 26, the authority's board elected new officers. Daye, the outgoing chairman, opened the meeting, which included representatives from fewer than half of the 15 towns served by the regional ambulance service. The incoming team includes Chairman Dean Preston, who represents the Unorganized Territories, Vice Chair Michael Cummings from Eastport, Secretary John Sutherland of Lubec, and Treasurer Linda Pagels-Wentworth of Baileyville. This is the team that must solve the funding challenge.
Following the election, the only item on the agenda was the organization's financial situation. Funding for ongoing operations includes stipends paid by the individual towns served by the authority as well as payment for emergency and patient-transfer services that are billed on a case-by-case basis. Claims for individual services are presented to MaineCare, Medicaid and private insurance companies. Reimbursement rates and payment schedules vary but generally cover less than half the costs. Part of the difference is made up by contributions from the towns.
The authority covers much of eastern Washington County and operates from three central locations, Baileyville, Eastport and Lubec. It employs 47 individuals with a weekly payroll of approximately $17,000. The three locations respond to about 1,450 calls annually. Authority records show that, as of July 19, nearly $570,000 was due the organization from the three primary sources, an amount which Pagels-Wentworth has described as "inflated" due to administrative problems that "have been resolved." According to Small, this sum also includes the accumulated unpaid balance of claims that have been paid. This amount exceeds the total of long- and short-term debt. Debt service costs the authority nearly $100,000 annually under the current structure; this includes long-term debt and a revolving credit line, which has been largely used. Accounts payable total $52,718.51, of which 24.6% has been outstanding over 90 days.
In an interview, Pagels-Wentworth observes, "It's been five years since the stipends have increased, and in that time everything else has gone up." In a discussion about the operating deficit, Preston pointed out, "No private [company] is in here trying to take over this business." Several town representatives questioned whether the stipend schedule is equitable on a town-to-town basis, comparing population and service levels with the annual fee paid for coverage.
Daye, speaking in his role as the outgoing chairman, said, "If you want an ambulance service, somebody has to step up to the plate." He observed, "A lot of the towns have become complacent about coming to this meeting." Each town served by the authority is invited to send a representative, typically a member of that town's board of selectmen.
A working subcommittee has been established to "identify holes" in the funding and to make recommendations regarding adjusting the stipends paid by each town. This group has been asked to present their findings at the next meeting, set for late August.