The Waterville Fire Department plans to hire a collection agency in New York to recoup debt owed by some who have used the city’s ambulance service. Above, fire Chief Jason Frost stands Sept. 18 with Waterville’s two ambulances. Anna Chadwick/Morning Sentinel file

WATERVILLE — The Waterville Fire Department plans to hire a collection agency to try to recoup about $500,000 in debt owed by some who have used the city’s ambulance service, officials said.

The Empire Credit & Collection Agency of Lindenhurst, New York, would receive 30% of any money it collects, and there is no cost to the city for the collection service, according to City Manager Bryan Kaenrath.

The City Council voted 6-1 last week to authorize the Fire Department to hire Empire, which will not try to collect from Waterville residents who have used the Fire Department’s ambulance service.

“If you’re a Waterville resident, we are not going to engage in collection activity on you,” Kaenrath said.

The $500,000 debt began building when the Fire Department began transporting patients to hospitals in 2020 after obtaining a license to do so. Prior to that, firefighters responded to emergencies with a rescue truck and treated patients at the scene. Delta Ambulance took patients to hospitals.

Fire Chief Jason Frost told the City Council on Nov. 19 that Quick Med Claims processes and bills out the department’s emergency medical service claims to insurance companies and private payers. If bills are not paid after 180 days, they come back to the Fire Department as uncollected debt.

The Fire Department put a request out to bid for collections agencies and chose Empire, which already works with Quick Med Claims, according to Frost. Some fire departments choose to write off such debt because it is difficult to collect, he said.

“We do not have the bandwidth to go after this ourselves,” Frost said. “It is a long, tedious process, so we looked at going with an agency to do it for us.”

Empire touts an 82% collection rate on accounts, according to Deputy Chief Everett Flannery of the Fire Department, who said it is likely not that high for medical-related bills. By the time the department receives the uncollected debt, it is already 180 days old, he said.

Much of the Fire Department’s debt is from unpaid co-payments, typically for MaineCare or Medicare patients, he said. A good amount of the debt is from people who are self-pay and not insured, he said. Some debt is from people for whom the department does not have an accurate address, or the billing company was unable to find an address, according to Flannery.

To put Waterville’s debt into perspective, according to Frost, the Augusta Fire Department is a bit larger than the Waterville Fire Department, but the number of emergency medical calls is similar.

“They write off about $1 million every single year,” Frost said. “They do not even try to go after it.”

Frost said he does not know if the collection agency would be able to recoup any of the debt, but he and other officials figured it is worth a try.

Flannery said Waterville residents make up about 47% of the uncollected debt.

Councilor Rien Finch, D-Ward 6, the lone dissenter in voting to approve hiring the collection agency, said he estimated that, in a best-case scenario, $146,000 would be collected, assuming Empire reaches an 82% collection rate and keeps 30%.

Most of those who owe, Finch said, are the most vulnerable people who are likely on MaineCare and Medicare or are self-pay and have no insurance. Finch asked what the average debt is per person.

“It’s as high as a co-pay of $100 to $2,000, so there’s a lot of variability in there,” Flannery said.

Flannery and Frost said they must have further conversations with Empire about a collection policy, and they would bring a proposed policy back to the City Council.

A document from Empire issued to the Fire Department outlines a typical three-phase process it uses to collect debt, which includes sending letters to debtors through the U.S. mail to try to resolve debts and if that fails, a lawyer tries to contact debtors, with 90% of cases resolved by this stage, according to Empire.

If that fails, the Fire Department would have two options: Close the cases and write off the balances as a loss, or continue with litigation using Empire’s attorney affiliates.