Local officials received a letter last week stating Owensboro Health Regional Hospital will not renew its contract to provide backup emergency ambulance services if the existing contract is terminated.
The letter came from Wyatt, Tarrant & Combs, LLP, a Louisville-based law firm representing Owensboro Health.
According to the notice sent to local officials, Owensboro Health will not be contributing to the $150,000 subsidy costs associated with the City and County’s new ambulance contract with American Medical Response (AMR), which will replace Yellow Ambulance as the county-wide ambulance provider on July 1.
The letter stated that although Owensboro Health was involved in a 1978 ambulance agreement, it was not involved in the most recent 2018 agreement where city and county governments awarded Yellow Ambulance an additional one-year contract. Owensboro Health contends officials did not ask the hospital to contribute to Yellow Ambulance’s $60,000 subsidy.
Owensboro Health last signed backup ambulance and financial service agreements in 2008. The three parties were obligated to develop and approve a takeover contingency plan in the event the primary ambulance service agreement was terminated within one year.
“No Takeover Contingency Plan was developed and put in place as contemplated by the 2008 agreement,” the letter reads. “Accordingly, under the language of the 2008 agreement, the referenced 1978 agreement controls the parties’ obligations until the City and County solicit bids and award a new contract.”
Because the City and County voted in approval of entering a new contract with AMR to take place the day after the contract with Yellow Ambulance ends, there will be no gap in coverage.
The annual termination date for the 1978 agreement is Sept. 18, 2019, and through the letter sent to local officials, Owensboro Health gave 90 days notice that it will not renew its agreement to provide backup ambulance services, terminating its duties and obligations.
Without an agreement with OHRH, it is currently unclear as to how City and County officials will move forward in selecting a backup ambulance provider for the 100,000-plus Daviess County residents.
Daviess County Judge-Executive Al Mattingly has been outspoken about his disappointment with Owensboro Health’s President and CEO Greg Strahan in his refusal to contribute toward the annual subsidy costs required in the new ambulance contract, especially in that the hospital serves the entire county as the primary provider for medical emergency services.
Moreover, City and County officials have said, Owensboro Health will reap the financial benefits of the ambulance services provided by AMR as many of its runs will be directed toward Owensboro Health’s Emergency Department, putting money in the pocket of the hospital, but without any payment from the hospital in return.
Strahan has never made public his exact reasoning for not paying subsidy costs or entering into the ambulance agreement as a third party, although he did mention at a Fiscal Court meeting that providing ambulance services for the entire county would be a financial burden on the hospital.
After receiving the letter from Owensboro Health’s counsel, Mattingly said he agrees with one thing Strahan has said publicly.
“I absolutely agree with the CEO of the hospital and stand ready to have a public conversation with him about the future of our community’s healthcare,” Mattingly said. “I don’t want to have any back-room conversation. I want this conversation to be public, and I’d like to hear what he has to say.”
At an April 24 Fiscal Court meeting, Strahan said while he wasn’t willing to sign into any ambulance agreements on the hospital’s behalf, we did look forward to working with local officials on other healthcare-related issues.
According to County Attorney Claud Porter, after the Attorney General’s Office determined the hospital to be a public agency, Circuit Court ruled in 2012 that the hospital was a private agency that couldn’t be controlled by Daviess County Fiscal Court.
“The hospital is still involved with the City and County — they just have a different meaning of the word ‘involvement’ than we do,” Porter said. “I’d argue that one of the community’s biggest health issues revolves around having a backup ambulance agreement. Having the hospital provide backup ambulance services is the most logical plan.”
Although OHRH can’t be controlled by local government entities, Porter said half of the hospital’s board is made up of City and County officials, which doesn’t mean the City and County have control, but they do have a level of involvement.
While a backup ambulance agreement isn’t legally required, Porter said the County would very much like to have an agreement in place.
“We always like to build in redundancies into that kind of plan,” he said. “We’d like to have a contingency plan in place so we know what options are available. How do we ensure the public has ambulance services regardless of what the situation is? That’s what the hospital is there for. With this letter, they’re saying, ‘We don’t think we want to do that anymore.’”
Mattingly told Owensboro Times on May 15 that he had no plans to file a lawsuit over Owensboro Health’s unwillingness to contribute financially and act as a backup provider for ambulance services. However, Porter said Fiscal Court could possibly ask a Daviess County Circuit Judge to review the 1978 agreement and take a look at the operations, maintenance and funding it entailed.
“Fiscal Court and the City will review all options, including but not limited to, a declaratory judgment action to determine the rights and obligations of the County, City and hospital,” Porter said.
City Manager Nate Pagan said the City will have outside legal counsel review the letter from Wyatt, Tarrant & Combs and all documents involved in past ambulance agreements before deciding whether to go forward with a friendly lawsuit against the hospital.
Owensboro Times reached out to Owensboro Health regarding the matter, but Marketing Director Brian Hamby said the hospital couldn’t comment on the situation at this time.