 "Photo: South End file photo")
Wayne State’s School of Medicine and the Detroit Medical Center signed a new five-year contract Feb. 10, which will gives DMC sole sponsorship of 50 residency-training programs, according to the SOM.
This contract replaces the previous cosponsorship of the programs signed in a 2006 term sheet set to expire in June.
“It was not really a contract,” said Kenneth Lee, vice dean and business affairs executive director at the SOM. “The intent of the term sheet was to develop and finish out a contract.”
He said that although the two were operating under the term sheet, they had negotiated before and since its signing.
Lee said he worked closely with Valerie Parisi, dean of the SOM, in negotiations with the DMC to arrive at an arrangement.
“When anybody would look at the contract, I think that they would see it’s very even-handed on both sides,” Lee said.
He said hospitals have a limited number of resident slots that are government funded. Universities alone cannot own these slots, so there are many sole-sponsorship residency models around the country. Since SOM doesn’t own these slots, Medicare provides the DMC with funding.
“So the actual sponsorship of things just puts it over in the hospital’s hands where they actually own the Medicare slots for the residents anyway,” Lee said.
Sole sponsorship, he said, means that the DMC takes on an increased administrative role in the residency programs and pays the residents’ stipends to cover such costs as textbooks and boarding.
Graduate Medical Education, an administrative arm of the Congress-authorized Council on Graduate Medical Education, will now be under the DMC.
“So those are really the only internal changes that you’ll see,” Lee said. “Everything else pretty much remains the same.”
Teaching the residents still falls under the SOM’s responsibilities. Lee said this ensures that residents get a WSU diploma.
Floyd Allen, general counsel of legal affairs at the DMC, said the residents are employed by the DMC but interview with WSU because they are required to be students in the program.
As part of the agreement, the SOM will receive a reduction in its compensation from the DMC over the next three years.
“It depends on how you look at it,” Lee said. “But an actual overall reduction in the next three years contract-to-contract is about 25 percent.”
But Allen said the DMC would not really be losing or saving money in the new contract.
“It’s probably going to be cost-neutral,” he said. “There may be some costs that are more expensive than others. But, basically, those would have been costs that the DMC was already paying to Wayne State.”
The new contract is also automatically renewable and is expected to be more stable.
“It’s automatically renewable because every year you’ve got, at least, the length of the residency and one year added on to the contract,” Lee said.
It’s called a five-year rolling horizon because five years is the maximum length of a residency program, Lee said. If a breach of contract were to occur, any residents in the program or applying to the program for the next year would not be affected.
Allen also spoke about a common mission. He said WSU and the DMC are training residents to be future doctors in the community who are, at the same time, providing clinical care as a part of their training process.
“So they’re providing the hospital care … We’re providing the clinical physician care. So it makes logical sense that we would cooperate together. I don’t think that’s changed,” Lee said. “We’re both here to support Detroit, and we’ve got to work together to do that. That’s the bottom line.”
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