Hidalgo County EMS, a privately owned company that provides ambulance service to parts of Hidalgo County, filed for bankruptcy Tuesday.
Chapter 11 bankruptcy would protect Hidalgo County EMS from creditors while the company attempts to restructure debt.
“This voluntary filing was determined to be in the best interest of the company at this time, and we want to assure the public and our clients that Hidalgo County EMS and South Texas Air Med remain operational with the same and highest standard of care that our clients, and the public, deserve,” company owner Kenneth B. Ponce said in a statement. “All services, including 9-1-1 ambulances and air ambulances, will remain in full force.”
Hidalgo County EMS provides ambulance service to rural Hidalgo County, the city of Pharr, the city of Edinburg, the city of Peñitas and Sullivan City.
In the city of Mission, where Med-Care EMS is the primary ambulance service provider, Hidalgo County EMS provides backup ambulance service.
The company employs 350 people, including paramedics and registered nurses, according to the Hidalgo County EMS website, which states the company serves “90 percent of Hidalgo County residents.”
Hidalgo County EMS owed about $907,000 to the company’s top 20 unsecured creditors on Tuesday, according to bankruptcy court records.
The company owed $260,000 to Pennsylvania-based Med Claims, which provides billing services; $105,000 to California-based Life-Assist Inc., a provider of medical supplies; and $100,000 to Dallas-based Assured Benefits Administrators, which provides employee health insurance.
Other unsecured creditors include Lone Star FC, the company that owns the RGV Toros soccer team, which is owed $49,000 for a sponsorship; Hacienda Ford of Edinburg, which is owed $22,000 for vehicle parts; and the law firm of Atlas, Hall & Rodriguez, which is owed nearly $6,300 for professional services.
Documents filed Tuesday didn’t list the company’s secured creditors or assets.
Hidalgo County EMS estimated the company had 200 to 999 creditors and liabilities of $1 million to $10 million, according to bankruptcy court records, which provided ranges for each category. The company also had assets valued at $1 million to $10 million.
Providing ambulance service in Hidalgo County is a tough business.
About 31 percent of Hidalgo County residents lacked health insurance coverage in 2017, according to U.S. Census Bureau data. Nearly 32 percent had a household income below the federal poverty level.
The majority of local governments contract with privately owned ambulance companies to respond to 911 calls. Local governments, however, typically don’t pay the ambulance companies, which bill insurers and individuals to cover their costs.
Med-Care EMS, which competes with Hidalgo County EMS for ambulance contracts, filed for Chapter 11 bankruptcy last year.
The bankruptcy didn’t appear to impact day-to-day service provided by Med-Care EMS. It emerged from bankruptcy in April.
Hidalgo County EMS will request court approval for Omar Romero, who owns a consulting company called Government Asset Services, to serve as chief restructuring officer.
Romero is also the city manager of Peñitas.
With approval from the bankruptcy judge, Romero would be assisted by Corpus Christi-based law firm Jordan Holzer & Ortiz, which would serve as bankruptcy counsel, and McAllen-based accounting firm Burton McCumber & Longoria.