The century-old academic and clinical relationship between the Detroit Medical Center and Wayne State University is disintegrating.

The parent company of DMC, Dallas-based Tenet Healthcare Corp., informed Wayne State University Physician Group on Tuesday afternoon that it will terminate its longtime affiliation on May 15 when an 18-month contract expires.

In a letter to WSU faculty Wednesday afternoon, President M. Roy Wilson, M.D., said he received a call from a top Tenet executive to explain that DMC would halt negotiations and end the contract for clinical and administrative services May 15. A DMC source who requested anonymity said hospital advisory board members were also on the call and they were in full support of Tenet's decision.

"I am writing to inform you that despite making steady progress toward a new long-term agreement, Tenet Healthcare Corp. management in Dallas communicated to me that it has decided to end contract negotiations and dissolve the decades-long relationship between the Detroit Medical Center and Wayne State University, beginning with the Wayne State University Physician Group," Wilson said.

Wilson said Wayne State is disappointed but has agreed to work with DMC on a transition plan "that may take several years of hard work."

In a statement Wednesday afternoon from DMC, CEO Tony Tedeschi, M.D., blamed Wayne State leadership for threatening in a April 19 letter to end clinical and administrative services at the DMC.

But the Wayne State letter was intended to prompt DMC into completing the negotiations that had dragged on for months, WSU officials told Crain's. The intention of the May 15 deadline to complete the talks and sign the five-year contract was never to leave DMC without physician coverage, they said.

Tenet officials in Dallas were upset with the ultimatum, DMC sources said. As a result, Tedeschi said DMC was "forced ... on a path to protect access to care for our patients and seek alternative partnerships to sustain a world class academic health care system in Detroit."

Several high-level sources at DMC and Wayne State who are familiar with the talks and requested anonymity told Crain's that Tenet officials in Dallas have rejected proposals negotiated by DMC and Wayne State officials and that the 100-year-plus relationship is over.

WSUPG Chairman Jack Sobel, M.D., has said that in the event the partners couldn't reach an agreement by May 15 that "elective and non-emergency clinical services provided by UPG will cease to be provided."

A DMC source told Crain's that UPG doctors will be allowed to continue to see patients at DMC but they will not be paid by the hospital. However, UPG doctors will continue to serve DMC's residency and undergraduate medical student programs. Those teaching agreements are five-year "evergreen" contracts that have rolling one-year extensions and are required by physician accreditation programs.

Tedeschi said in his statement that DMC will continue to work productively with the medical school on residency and medical student teaching programs.

"Our relationship with WSUSOM leadership has become acrimonious, driven by WSUSOM leadership's transactional approach to discussions with the DMC and their lack of transparency about competing commitments," Tedeschi said.

Chuck Shanley, M.D., CEO of University Physician Group, said he is unclear why Tenet terminated the talks. "I thought we had a deal. We were very close. We negotiated in good faith for a long-term contract, a five-year deal," he said. "We never wanted to stop providing the safety net services we have always provided" at DMC.

Shanley said Wayne State's UPG doctors will continue to show up for work at DMC past May 15.

"We will continue taking care of patients," said Shanley, adding he doesn't know how long UPG doctors can work without pay.

"We will do it for a period of time, and we won't do it for free (forever), but we want to make sure all the services are covered — the stroke program, the neonatal program. Doctors do these services. You can't replace them with locum tenens (contract physicians)," he said.

More than 300 UPG doctors across every specialty and subspecialty take care of patients at DMC, he said. Services include most surgical specialties, obstetrics, nephrology, pathology, cardiology and oncology, among others, Shanley said.

Janis Orlowski, M.D., chief health care officer with the Association of American Medical Colleges, said it is highly unusual for a medical college to run into a dispute like this with a major academic medical center partner.

"This is a big deal where you have a faculty who is clinically responsible for patients, and they get notice their contract will expire in two weeks," Orlowski said. "This has happened before, but there was more time for a transition."

Orlowski said options include UPG faculty taking patients elsewhere to treat and bill for care or DMC hiring UPG doctors.

"They could figure out a way to bill instead of getting funding from DMC," she said. "Problem is, this is highly disruptive. If this is a bargaining chip (by DMC), it is a bad way to bargain because it involves patient care."