The Detroit Medical Center isn't investing enough into capital improvements or medical research, which, along with ongoing concerns about quality, led an oversight board for the private for-profit system to raise "serious concerns about the apparent decline in the public perception of DMC as the institution responsible for Detroit's medical safety net."

The report was issued by the Legacy DMC board. The board was formed in 2010, when now-Detroit Mayor Mike Duggan, then the CEO of the nonprofit DMC, brokered a deal to have private for-profit Vanguard Health Systems of Nashville, Tennessee, buy the health system.

The deal was made in part to help get money available to pump into DMC to improve it. DMC had struggled for years with finances, including needing a $50 million bailout from the state in the early 2000s.

As part of the deal, Vanguard made a series of written promises around spending, quality of care and support for medical education for the first 10 years after the sale. The Legacy DMC board was formed to provide oversight of those covenants. It issues an annual report to the Michigan's Attorney General, who posted this year's report Monday.

In 2013, the public for-profit company Dallas-based Tenet Healthcare Corp. bought DMC from Vanguard. Tenet agreed to keep the agreements made by Vanguard.

This year's report is full of worry about the DMC going forward, particularly whether Tenet is making enough investment into the system, which is the safety net hospital system for those in Detroit who can't pay for medical care.

"Legacy's concerns for DMC's future success, however, have increased since last

year's report," this group says this year. "Recent developments are negative and have received extensive media coverage. The hospitals have performed poorly on basic patient safety and quality inspections, the long-standing relationship with the WSU (Wayne State University) School of Medicine is fracturing, there have been allegations of negative patient outcomes resulting from staff reductions, and, this week, additional layoffs have been announced.

"Less public concerns include inadequate support of research activities, which, over·

time, will jeopardize DMC's ranking as an academic medical center. Importantly, Legacy has frequently requested DMC to demonstrate its financial support of research and DMC has not presented a credible case that it is in compliance with the commitment to support research. Outcomes for academic medical centers previously owned by Tenet provide no reason for optimism. Nor do the widely circulated reports concerning the debt levels disclosed in Tenet's balance sheet and the high level of executive turnover at Tenet.

"As noted in previous reports, DMC's annual capital investment since 2015 remains at or below the low end of the acceptable range for the existing hospitals jeopardizing the progress from initial facility and equipment improvements."

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In 2017, Tenet fulfilled an $850-million promise to renovate and upgrade the once-struggling hospital system, including a new addition to the Children's Hospital of Michigan in Midtown Detroit.

In response to the report, the DMC wrote a letter to the Legacy board, saying it had gotten its conclusions wrong. For the past two weeks, DMC has been running periodic full-page ads in the Detroit Free Press and News touting its investment in Detroit.

DMC CEO Anothony Tedeschi also sent an email to his staff on June 10, reiterating those points.

"While we respect the Legacy Board and its interest in assuring that the DMC continues to deliver the service that the people of Detroit deserve, the Legacy Board report does not accurately reflect the DMC's achievements, including the fact that the DMC has met or greatly exceeded all obligations under the agreement in connection with the acquisition.

"Our investments have been focused in areas where the dollars can make the most difference to front-line patient care and to the construction, expansion and renovation of our hospital facilities and are targeted to benefit our patients and dedicated health teams."

The letter didn't sway the board. In a response back, the board said it had been asking for years for more information from the DMC and hadn't received it. It said it stood by its concerns.

Contact David Jesse: 313-222-8851 or djesse@freepress.com. Follow him on Twitter: @reporterdavidj