Nonprofits challenge Maine’s decision to award $1B Medicaid rides contract to out-of-state company

By Erin Rhoda, Bangor Daily News Staff

Two organizations are appealing the Maine Department of Health and Human Services’ decision to award a potentially $1 billion contract to an out-of-state company, with a history of complaints, to arrange transportation for Medicaid patients who have no other way to get to doctor appointments, dialysis and cancer treatments.

Penquis Community Action Agency and Waldo Community Action Partners, nonprofit organizations that provide a range of services to low-income residents in much of eastern and midcoast Maine, are asking the state to reconsider its award to Modivcare Solutions LLC, the nation’s largest broker of non-emergency medical transportation services.

Kara Hay, Penquis’ president and CEO, said the organizations appealed to ensure the award was “based on accurate information” and “the best interest of the communities we serve.”

The nonprofits submitted bids last summer to continue providing transportation services in select regions of Maine, but DHHS did not pick them. Instead, the agency announced in October it would award the contract to Modivcare to provide services across the entire state, effectively ending Penquis and Waldo CAP’s role and eliminating revenue that they use to pay for the infrastructure for their wider range of transportation services. The state anticipated Modivcare’s two-year contract — with renewals for up to 10 years — would start July 1. 

The award is estimated at $750 million over the decade, Hay said. Being unable to provide Medicaid transportation services for that length of time would prevent Penquis from keeping its vehicles and systems that allow it to provide transportation, she said, making it too costly to resume offering the services in the future. 

The appeal hearing with DHHS will be held Wednesday and Thursday, Hay said.

Penquis currently provides transportation services for Medicaid patients in Penobscot, Piscataquis, Somerset and Kennebec counties. Waldo CAP serves Waldo, Lincoln, Knox and Sagadahoc counties, and the towns of Brunswick and Harpswell. 

Modivcare Solutions LLC, a wholly-owned subsidiary of publicly traded Modivcare Inc., headquartered in Denver, schedules rides for the rest of the state, subcontracting with other entities that do the driving.

Maine debuted the broker system in the summer of 2013, under the administration of former Gov. Paul LePage. Maine had long dealt directly with the organizations that provided the rides themselves — generally local community action agencies — but it made the switch after the federal government, citing administrative and oversight reasons, denied DHHS’ request in 2010 to continue its transportation system as it existed.

Penquis, Waldo CAP and Modivcare must ensure people on MaineCare, the state’s Medicaid program, can ride in wheelchair-accessible vehicles and make it to and from appointments, including check-ups, scheduled surgeries and medication pick-ups, according to the state’s request for proposals. 

Last year Penquis, which is both a transportation broker and provider, was on time for 92 percent of rides. Out of 672,339 trips, it logged only 107 complaints, something Hay described as “exceptional performance.”

“We are unwavering in our desire to provide this service because we know how much it matters to the people we serve, and it has to be high quality,” Hay said. “It saves their lives, whether they’re getting to treatment for substance use disorder or a preventive health appointment or mental health counseling. These are critically important appointments, and they don’t have access any other way without this service.”

Waldo CAP CEO Donna Kelley did not respond to requests for an interview.

In its award justification statement, DHHS said the proposals submitted by Modivcare represented “the best value” for Maine, and the strengths of Modivcare outweighed those of other bidders “through both their qualifications and experience as well as the services they intend to provide.”

Bidders had to submit separate proposals for each of Maine’s eight transportation regions that they wanted to cover. Four companies — EPICMD Technologies, Medical Transportation Management Inc., Modivcare and WellTrans Inc. — submitted bids to cover the entire state, while one company, Verida Inc., sought to provide services to three regions. Penquis bid for four regions, and Waldo CAP bid for one. 

DHHS gave Penquis’ bids mostly scores of 75 out of 100, according to the state’s scoring sheet. Waldo CAP earned a 91. All of Modivcare’s proposals received scores of 95.

(DHHS gave Medical Transportation Management’s proposals scores of 90; WellTrans was disqualified; and EPICMD Technologies received the lowest scores, in the 50s.)

Modivcare scored higher than other bidders because of its “detailed, comprehensive response describing how the proposed services would be met,” according to DHHS’ award statement. In its evaluation notes, DHHS wrote that Penquis did not address certain topics, such as its procedures for vehicles that are running late, how Medicaid members would not be billed for no-shows or scheduled changes, or how it would store records.

“We respectfully disagree with the scoring of the proposals, and we think that the evidence will show they ought to have been scored differently,” Hay said.

DHHS noted that Modivcare provides non-emergency transportation services in 50 states and “has a positive work history” in Maine. In 2022, it saved $1 million by increasing patients’ use of public transportation, coordinated more than 1 million trips and maintained a “complaint-free rating of over 99 percent,” DHHS wrote.

One former community action agency director, however, said the state is not taking into account what will happen long-term if local nonprofits lose their contracts for non-emergency transportation, and said Modivcare has not always served its clients and subcontracted drivers well. 

Shawn Yardley retired in 2022 as CEO of Lewiston-based Community Concepts, which served as a subcontractor to what was then Logisticare Solutions — which became Modivcare — to drive people to their appointments. Over time, the company worked with more subcontractors and gave Community Concepts less lucrative and fewer rides. Its rates didn’t keep up with costs, and the company was not responsive when he asked for improvements, Yardley said. The organization lost drivers, and the program became untenable to operate. 

Over his seven years with Community Concepts, Yardley said he heard from patients and medical providers who were frustrated with many missed rides. Modivcare has received more than 380 scathing customer reviews on the Better Business Bureau website since March 2021, with people describing how the company left them stranded, provided poor customer service, said a car was coming but never showed up, failed to provide wheelchair-accessible vans when requested and didn’t resolve complaints. 

Last year Modivcare agreed to pay $3.75 million to the federal government and state of Ohio to settle a lawsuit alleging it submitted false claims for payment to Medicare and Medicaid. 

Modivcare did not respond to requests for an interview.

Yardley questioned why the state would want to give a major statewide contract to an out-of-state, for-profit company because any extra money will go to investors rather than back into nonprofit programming. He worries about whether the company will ensure reliable and equitable service in more rural areas. And he believes that, with Penquis and Waldo CAP out of the way, Modivcare will have “a stranglehold on the entire state despite their very, very poor reputation in many circles in Maine,” he said.

Not receiving the contract would reduce Penquis’ ability to provide transportation to the wide range of people it supports, including those not on Medicaid who need to get to dialysis or cancer treatments, or for people who are housebound to go to the grocery store, Hay said. The large state contract for Medicaid patients helps support the vans, systems and staff that allow Penquis to offer transportation to others.

“We braid together all of the funding and services in a way that allows us to serve all those populations. If you pull non-emergency medical transportation out, it’s going to have a significant impact on the availability of transportation services for those counties,” she said.

While Modivcare was notified of the award, DHHS has not finalized a contract with the company, pending the administrative appeal, said DHHS spokesperson Lindsay Hammes.

“The Department is limited in commenting due to the pending appeal. We are committed to providing safe, reliable and high-quality transportation to MaineCare members that helps them to meet their health care needs,” she said.

Rhoda is the editor of Maine Focus and may be reached at

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