A 214-count federal indictment against a Calais ambulance service and its owner was unsealed Thursday, alleging a widespread, complicated scheme in Down East Maine to defraud the Medicare and Medicaid health-benefit programs out of close to $ 1 million.

In a matter described by U.S. Attorney Jay McCloskey as the “largest health-care fraud case” in Maine, Dana Eugene McGovern, 36, of Calais and his business, McGovern’s Ambulance Service Inc., allegedly billed the federal programs for ambulance transportation services not actually performed or not allowed under program rules.

McGovern and his ambulance service also are charged with obstruction of two federal audits and with money laundering.

In addition, the indictment seeks forfeiture of assets of McGovern’s Ambulance Service as well as other assets of the business and of Dana McGovern.

The indictment alleges McGovern billed Medicaid and Medicare for:

. Ambulance services when a wheelchair van was used instead.

. Oxygen when no oxygen was administered.

. Taking people to hospitals when they actually were taken to doctors’ offices.

. Evacuating people to emergency shelters during the Great Ice Storm of 1998, and billing as though the people had received advanced life support services and were taken to a hospital.

With regard to wheelchair van services, the indictment alleges that McGovern’s Ambulance and Dana McGovern submitted claims to Medicaid for miles driven when the Medicaid recipient was not in the vehicle; billed for transportation of a client who was not wheelchair-bound; and billed for transportation for other than medical purposes.

McGovern faces the possibility of decades in prison and $1 million in fines if convicted of all counts handed up in the 53-page indictment. He will be summoned to appear at a federal court hearing in Bangor, according to a court official.

The indictment was handed up in secret Wednesday, then unsealed a day later. The secret indictment was necessary in order to obtain a court order to freeze McGovern’s assets, McCloskey said.

The ambulance company is based in Calais and serves numerous towns in Washington County.

The document details a variety of billing schemes in which Medicaid and Medicare were allegedly bilked out of $912,664.23 over several years.

In one instance, McGovern allegedly submitted an ambulance transportation claim to another insurance company, NYLCARE Health Plans of Maine Inc., after one of his ambulances took him from a Bangor hospital to his home in Calais following a vasectomy and circumcision.

“The allegation is there was rampant fraud committed by the defendant and his company in billing Medicare and Medicaid,” McCloskey said in a telephone interview Thursday.

Under Medicare regulations, an ambulance cannot be used for routine transfers to and from a doctor’s office or if other less-expensive and appropriate means are available.

The indictment alleges money obtained in this scheme was used to pay for business expenses, including employee costs. The money also was used to buy ambulances and wheelchair vans, mailing expenses and to pay for fuel and maintenance costs as well as for courier and computer services and telephone costs.

The investigation was conducted by U.S. Department of Health and Human Services’ Inspector General’s Office, the FBI and the Medicaid Fraud Control Unit of Maine’s Attorney General’s Office.

Dana McGovern’s lawyer, Leonard Sharon, said late Thursday that he was not aware that his client had been indicted.

“We knew he was being investigated. I didn’t know how far along the United States was in the investigation or how close they were to an indictment. It’s no surprise. I’m not happy about it, but it’s not like, ‘Where did it come from,”‘ the Auburn lawyer said.

Sharon said he planned to request a copy of the indictment. “We have to take a look at the evidence and see what they are alleging has violated the act and then be better able to assess exactly what’s happening,” he said. He said he would be meeting with Dana McGovern in the next couple of days.

Dan Lacasse, the lawyer for McGovern Ambulance, said he also was unaware of the indictment. “The next step is to look at the indictment and determine what he was indicted for, and Mr. Sharon will enter a plea,” the Calais attorney said.

“Dana has continually protested his innocence and he is entitled to that presumption,” Lacasse said.

McGovern did not return a telephone call Thursday evening.

Problems for Dana McGovern became evident last year when federal agents swooped down on the company office on Union Street and removed business records, including copies of Medicaid and Medicare billings.

At the time, the agents, including some from the FBI, offered no explanation, but they told Lacasse that it was part of a Medicaid and Medicare investigation.

In answer to questions from the Bangor Daily News at the time of the raid, a spokesman for the federal officials said that such investigations were usually based upon allegations that may have stemmed from a tip from a Medicare carrier that pays a bill, a tip from a beneficiary or from an employee of a service provider.

During 1999, the Health and Human Services’ Inspector General’s Office successfully prosecuted ambulance companies across the country and achieved a range of fines. In New York, the largest ambulance service provider in the United States agreed to pay $9.5 million to resolve allegations against it. A Massachusetts ambulance company paid the government $120,000 to resolve allegations concerning improper billing practices.

Meanwhile, at McGovern’s Ambulance, a company spokesman earlier this week said the service was attempting to resolve a cash-flow problem that delayed last week’s employee paychecks.

In the past, McGovern provided 24-hour ambulance service to most communities in Washington County, and typically services were paid through the patient’s Medicaid, Medicare or insurance coverage. But the company cited skyrocketing costs in charging the communities it serves an annual fee, while others that already paid an annual fee saw those fees increase.

The fees ranged from a low of $341.25 for smaller communities to $15,500 for Calais.

Lubec was hardest hit when McGovern hiked its annual fee from $14,760 to $91,000 per year. Lubec voters raised the additional money during the town’s annual business meeting in August. The town has paid the fee on a month-by-month basis while searching for alternatives.

Last week, the ambulance company notified the town that the Lubec division was running a monthly deficit of nearly $5,000, and as a result service would be canceled as of Feb. 8.

McGovern also has encountered legal troubles with his former partner. In September, former business partner John Wentworth sued McGovern and their partner, Nancy Gillis, on grounds that McGovern had “mismanaged” their health-care corporation and left no profits for shareholder distribution.

The three owned and operated Calais Home Care Inc., a medical supply provider.

Gillis and McGovern filed a countersuit, claiming “gross malpractice” against their former accountant and partner.

In addition to his financial problems, McGovern has had his run-ins with the law in the past few months. In October, McGovern was charged with assaulting his wife. He was freed on $250 unsecured bail.

In August he was charged with criminal trespass and refusing to submit to arrest or detention after he refused to leave a Main Street bar. He pleaded guilty to the two charges and was fined $250.

But it hasn’t always been bad times for the businessman. McGovern was a teen-ager when he went to work as a part-time driver for Gene Newell, who owned and operated the city’s ambulance service. He later became a full-time driver.

In 1991, McGovern bought the business, which at the time served only Calais with two ambulances and 16 part-time employees. McGovern built the company into a business with more than 100 full- and part-time employees that provided ambulance service all over Washington County and Charlotte County in neighboring New Brunswick.

In 1996, McGovern was one of seven people, out of more than 5,000 eligible recipients, to receive the 1996 Special Merit Citation awarded by the Maine Emergency Medical Services Board. Maine EMS is the state agency that coordinates and licenses emergency medical services and personnel.