Do a couple of drain and fills w/Toyota T-IV or Castrol Multi-vehicle import. It's very easy to do on this car; there's a drain plug and a fill plug, they're both pretty visible. Drain it in neutral after shifting through the gears and you'll get out about 3.75 to 5 qts (total capacity is only 7.X qt). Measure what you took out and put the same amount in, then check the fluid level while warm. It probably wouldn't hurt to try a couple of drain and fills first.
My guess? The solenoids in the valve body are clogged. The hard parts on this transmission are quite durable, but the screens on the solenoids in the valve body can get clogged if you never change the fluid. While Ford won't rebuilt it, most indy transmission shops will, and there's actually an upgraded valve body kit available. 220K on the factory fill? I'd say you got good life out of it. The engine in this car will certainly go another 220K with minimal maintenance, so it's probably worth it to fix it if the rest of the car is in good condition.