| On November 22, 2006, the Detroit Medical | | | | DMC and WSU. A small number of the residency |
| Center (“DMC”) and Wayne State | | | | programs will be solely sponsored by either DMC |
| University (“WSU”) announced a | | | | or WSU, provided the new solely sponsored |
| temporizing resolution to a long-standing | | | | programs are able to obtain ACGME |
| contractual dispute. This dispute threatened both | | | | accreditation. Additionally, after June 30, 2008, |
| the future of the DMC/WSU jointly sponsored | | | | either DMC or WSU may apply for sole |
| residency programs and patient access to quality | | | | sponsorship of a number of residency programs |
| care in Michigan. The resolution, in the form of a | | | | not strictly tied to the Hospital sites. |
| legally binding “Memorandum of | | | | - DMC will pay WSU up to $8.8 million in |
| Understanding,” provided basic provisions to | | | | performance bonuses and recruitment support. |
| serve as the framework for a final, definitive | | | | - DMC and WSU agree to focus on their |
| agreement between the parties in the future. | | | | partnership for 18 months, and not “pursue |
| This article will address the dispute between DMC | | | | new competitive activities that would disrupt the |
| and WSU from the perspective of resident | | | | partnership.” However, the WSU Physician |
| training (also known as “graduate medical | | | | Group is permitted to partner with Oakwood |
| education”); the current status of the DMC | | | | Health System to open an ambulatory care |
| WSU jointly-sponsored residency programs as | | | | center in Troy, Michigan. See Memorandum of |
| defined by the Memorandum of Understanding; | | | | Understanding, DMC/WSU 2006. |
| and the residents’ role in effectuating a | | | | The Memorandum of Understanding was a critical |
| resolution of the dispute between DMC and WSU. | | | | step, which was recognized by the ACGME, which |
| The Dispute and Effect on Resident Training | | | | subsequently granted a two-year institutional |
| DMC and WSU, working in partnership, have | | | | reaccreditation. While this secures some degree |
| enjoyed a rich tradition of providing physician | | | | of stability for the DMC/WSU residency |
| training for decades. Roughly 1000 residents in | | | | programs, it should be noted that the typical |
| nearly 70 accredited specialty and subspecialty | | | | renewal of accreditation occurs every four to five |
| training programs have the opportunity to receive | | | | years. Also, the ACGME issued several citations |
| university-based residency training from the | | | | and identified issues that needed to be addressed |
| renowned faculty of WSU, while providing clinical | | | | in a progress report by DMC/WSU, including a |
| services to meet the challenging medical needs of | | | | statement of institutional commitment to the |
| the patient community seen in the Detroit DMC | | | | residency programs. This report has been |
| hospitals. This DMC/WSU resident workforce | | | | submitted and will be evaluated in April 2007. If |
| provides a significant contribution to primary | | | | the progress report is inadequate, or if other |
| healthcare within Detroit and plays a vital role in | | | | additional areas of concern evolve, the DMC/WSU |
| the health care safety net for the uninsured and | | | | residency programs may be subject to an |
| underinsured. | | | | additional ACGME review before the scheduled |
| While partnership has clear benefits for medical | | | | timeframe, with accreditation again placed at risk. |
| education and clinical service, disputes between | | | | While the Memorandum of Understanding does |
| DMC and WSU arose surrounding multiple issues. | | | | demonstrate progress, it does have noticeable |
| Areas of disagreement included the payment | | | | shortcomings. This document, which is thirteen |
| structure for medical training and clinical care | | | | pages (including signatures and attachments), does |
| provided by WSU physicians, the ability of the | | | | not articulate many of the details of the |
| parties to work together under non-exclusive | | | | anticipated final contract. As in the interpretation |
| arrangements, and control of various resident | | | | of any contract, DMC and WSU could interpret its |
| training programs which have historically been | | | | provisions differently, which may impede |
| co-sponsored between the institutions. | | | | negotiations as the parties make efforts to enter |
| Casualties of this conflict were first announced in | | | | into a formal final agreement. As of this writing, |
| April 2006, when inability to achieve contractual | | | | no finalized contract between DMC and WSU |
| agreement at that time resulted in a nine month | | | | exists. |
| contract extension. This extension was unable to | | | | DMC/WSU Residents Played A Key Role in |
| rectify core differences between the parties, | | | | Effectuating a Resolution |
| which led to the discontinuation of the orthopedic | | | | As noted above, achieving the temporizing |
| surgery residency program. This program was | | | | agreement in the Memorandum of Understanding |
| the second largest orthopedic residency in the | | | | was the result of influence from multiple parties. |
| Midwest and had received national recognition for | | | | The DMC/WSU residents played a particularly |
| their contribution to trauma surgical care. At the | | | | important role in effectuating a resolution to the |
| DMC’s discretion, the state and federal | | | | dispute between their co-sponsors. |
| funding paid to them for resident training was not | | | | Early in the process the DMC/WSU residents |
| released to follow these residents to new | | | | realized that they were very important |
| programs, despite Michigan State Medical Society | | | | stakeholders in the outcome of the negotiations, |
| and the American Medical Association positions | | | | as apparent from the potential jeopardy placed on |
| urging such temporary transfer of funds upon | | | | their continued training in an ACGME accredited |
| residency program closure. As a result, | | | | program. Notably, the completion of an |
| twenty-four DMC/WSU orthopedic residents were | | | | ACGME-accredited residency program is a |
| forced to seek other accredited programs that | | | | condition for medical board eligibility. However, |
| would be also willing to incur the cost of their | | | | loss of institutional accreditation would have likely |
| training, and relocate by July 2006. These | | | | resulted in the discontinuation of DMC/WSU |
| residents, who initially chose to pursue their | | | | residency programs altogether. With their |
| medical training in Detroit in good faith, were | | | | training at risk, residents felt that they should be |
| ultimately dispersed throughout the state and | | | | afforded an opportunity for input in the |
| country. | | | | negotiation process. |
| Several months later, it became clear that there | | | | Once it appeared that contract negotiations |
| was little progress in contract negotiations, | | | | between DMC and WSU had stalled, residents |
| jeopardizing the remaining residents who relied on | | | | employed several means to communicate their |
| both sponsors for their continued resident | | | | positions to DMC and WSU. This began with |
| training. This was recognized by the accrediting | | | | formal letters to institutional leadership defining the |
| body for graduate medical education, the | | | | resident role as a neutral third party in contract |
| Accreditation Council for Graduate Medical | | | | negotiations, with support for the continuation of |
| Education (“ACGME”), which mandates | | | | their current co-sponsored graduate medical |
| that all residency programs demonstrate | | | | education. These correspondences continually |
| adequate institutional support for resident training | | | | emphasized the risk to their own training, as well |
| in an environment conducive to medical education | | | | as to those patients who required their medical |
| and clinical care. | | | | services. They involved the media, had a press |
| Throughout months of interaction, the ACGME | | | | release, and held rallies attended by an estimated |
| requested documentation detailing how resident | | | | 400 residents and medical students, to articulate |
| education and well-being was to be preserved, | | | | the need for a DMC and WSU agreement to the |
| and held an onsite review of the institution to | | | | institution as well as the public. |
| evaluate the long term stability of the institutional | | | | Additionally, the residents obtained independent |
| agreements to date. If these conditions were | | | | legal counsel of Wachler & Associates, P.C. |
| not satisfactory, the ACGME was empowered to | | | | The residents and their legal counsel provided the |
| withdrawal accreditation at special meeting held in | | | | Governor’s appointed mediator, Mr. Fink, |
| the end of November 2006. Had the DMC/WSU | | | | position papers and additional information regarding |
| institution lost ACGME accreditation, all DMC/WSU | | | | the residents’ legal rights afforded to the |
| residency programs likely would have been | | | | residents through the resident contract with the |
| discontinued, resulting in the mass relocation of | | | | DMC/WSU. Notably, all residents are afforded |
| nearly 20 percent of Michigan’s resident | | | | rights pursuant to their individual residency |
| workforce out of a single health system. This | | | | agreements. Pursuant to the standard DMC |
| relocation would have been at the personal, | | | | WSU residency agreement for the 2006-07 |
| professional, and financial expense of each | | | | academic year, the DMC/WSU institution has a |
| individual resident. However, there would have | | | | contractual obligation to provide all co-sponsored |
| been a higher cost to the community, which is | | | | residents with a jointly sponsored, |
| comprised of many who are already medically | | | | ACGME-accredited training program. Breach of |
| underserved and depend on the DMC for | | | | the DMC/WSU residency agreements would have |
| provision of care. | | | | resulted in substantial damages to the DMC/WSU |
| The Resolution | | | | residents, potentially including lost wages (both |
| The fear of the termination of DMC/WSU | | | | current and future earnings), relocation costs, |
| partnership and their cosponsored residency | | | | emotional damages, etc. Based upon their |
| programs invoked active involvement from | | | | communications with the negotiation mediator, the |
| numerous parties, including the Wayne State | | | | DMC/WSU residents were able to lend their |
| University Board of Governors, the Detroit Medical | | | | insight and concerns to the negotiation process. |
| Center Board of Trustees, DMC/WSU residents, | | | | Further, the residents’ communications with |
| WSU School of Medicine students, medical | | | | DMC and WSU leadership ultimately led to the |
| societies representing both Wayne County and | | | | institutional recognition of the residents’ |
| the State of Michigan, Detroit Mayor Kwame | | | | rights. For example, during and subsequent to |
| Kilpatrick, and Michigan Governor Jennifer | | | | the contract negotiations between DMC and WSU, |
| Granholm, among others. David Fink was | | | | the DMC/WSU residency programs worked to |
| appointed by Governor Granholm to mediate the | | | | substantially revise the standard residency |
| negotiations in early November. | | | | agreement that the DMC/WSU residency |
| The outcome of this concerted effort was | | | | programs routinely entered into with residents. |
| realized at a press conference called by Governor | | | | Although several changes to the standard |
| Granholm on November 22, 2006, where DMC | | | | residency agreement were enacted for the |
| and WSU announced that they finally had reached | | | | 2007-08 academic year, DMC/WSU reaffirmed |
| agreement in the form of a binding Memorandum | | | | their support for residents by expressly including |
| of Understanding, which became effective January | | | | that the institutional responsibilities included |
| 1, 2007. This document provided an outline of | | | | providing ACGME-accredited educational training |
| the main provisions that the parties would finalize | | | | programs. Thus, DMC/WSU is contractually |
| at a later date in an executed final contract. | | | | obligated to the DMC/WSU residents to provide |
| Pursuant to the Memorandum of Understanding, | | | | medical education and clinical exposure in |
| which addresses the teaching, clinical, and | | | | substantial compliance with ACGME requirements. |
| administrative arrangements between DMC and | | | | In summary, though the intermediate solution to |
| WSU, the initial term of the agreement between | | | | the dispute between DMC and WSU may be |
| DMC and WSU is for 3-1/2 years. Following this | | | | imperfect, the Memorandum of Understanding as |
| 3-1/2 year initial term, the contract will be | | | | adopted by the parties provides a framework for |
| automatically extended for an additional year, | | | | the future relationship between the DMC and |
| unless either party gives 18 months’ notice of | | | | WSU. However, it is essential that the DMC |
| intent not to renew. Other key provisions of the | | | | WSU institution take the necessary steps to |
| agreement include the following: | | | | provide adequate support to the existing DMC |
| - DMC will allocate and pay to WSU $76 million per | | | | WSU residency programs, as defined by the |
| year for clinical, teaching and administrative | | | | ACGME. To achieve this end, and meet the |
| services. | | | | contractual obligation to its residents, it is |
| - All of the 68 current graduate medical residency | | | | imperative that DMC and WSU enter into a final |
| programs will be continued until at least 2009. | | | | written agreement enacting the terms of the |
| Notably, however, not all of these residency | | | | Memorandum of Understanding. |
| programs will remain jointly sponsored by both | | | | |