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Control of most city health care services returns to the Detroit health department today, two years after the department was dismantled amid complaints it was hopelessly mired in bureaucracy.

Health services such as immunizations, HIV/AIDS testing and tuberculosis treatment were turned over to the Institute for Population Health in September 2012, amid red tape and high employee costs that kept Detroit's Department of Health & Wellness Promotion from operating efficiently.

The Institute for Population Health is a private nonprofit that was set up by Mayor Dave Bing to administer tens of millions of state and federal health dollars that Detroit receives annually.

IPH hired medical workers and provided health services directly to residents at clinics around Detroit. Now, the city will contract nearly all of those services out to a variety of vendors, said Vernice Anthony, director of Detroit's Department of Health and Wellness Promotion.

Officials in the administration of Mayor Mike Duggan, who was CEO of the Detroit Medical Center before he was elected mayor, say it will be a smooth transition.

But critics complain too little time was set aside to prepare clients for the changes and dispute the city's contention that the move will improve and expand access to health services for residents.

"At this time, there's no plan to close any clinics," Anthony said.

"We're moving in a direction that is forward-looking in terms of policy. We will definitely support a strong communications plan so everyone knows where to go. Believe me, they will be very pleased when they see the kind of services they're getting there."

Institute supporters are more worried. Some clients will be served at new locations, and might not hear the news about today's changeover.

Notice of the changes was sent to stakeholders, including clients, last week, Anthony said. The changes were posted on the city's website on Friday. The shift is timed to coincide with the start of the 2014-15 fiscal year, according to Anthony.

Institute backers say transportation could be an issue for clients accustomed to former clinic locations, which were all near bus stops.

"I'm deeply disappointed," said IPH board member Barbara Murray. "There has not been any direct communication that I'm aware of with the mayor himself, and I would like to see that happen.

"I don't know how they plan to get these programs up and running that quickly."

IPH laid off about 120 employees this month as a result of the changes and expects to lay off about 30 more. About 80 former IPH workers have been rehired by the city's new health care vendors, Anthony said.

The institute will retain about $1.5 million in city contracts for restaurant inspections, hearing and vision testing, and lead poisoning prevention. It also will keep about $1.4 million for the Women-Infants-Children program and $175,000 for dental service, for three more months.

The city Health Department is staffed by about 25 employees. Five, including Anthony, are city employees, and the rest are contract workers. Anthony said the city will take on more contract employees to help manage the new workload, but couldn't say how many.

Detroit to use vendors

Under city management, most direct health services will be provided by vendors contracted by the city of Detroit. At issue is about $11 million in funding, including $4 million in federal funding for WIC services.

An $800,000 contract for children's special health care services, covering care for some of Detroit's sickest kids, was given to DMC Children's Hospital of Michigan. IPH also will lose $350,000 for emergency preparedness, $400,000 for immunizations, $175,000 for dental services and a $1.5 million federal block grant for maternal and child health.

"This is taking advantage of the highest level expertise in the city for one of the most vulnerable populations," Anthony said.

About $3.7 million will go to the Wayne State University School of Medicine to handle infectious disease testing and treatment.

Michigan Department of Community Health spokeswoman Angela Minicuci said the state will send the funding directly to the university at the city's request.

"The reason we are providing these services through Wayne State University now is because that is who the city of Detroit chose to provide the services," Minicuci said.

Anthony said Wayne State will be able to increase the number of residents screened for infectious diseases.

Immunization is the only health service the city will provide directly. Immunizations will eventually be integrated into the WIC food and nutrition service.

"This planning is already underway with the state," Anthony said. "The WIC programs are being rebid, and new vendors will take affect January 2015. Then, the integration can begin to be put in place."

Change surprises IPH

IPH officials said they were taken aback when the city issued a request for proposals from other vendors for their health services. A letter dated July 31 from Melvin "Butch" Hollowell, the city's corporation counsel, said IPH's contract, set to expire Sept. 30, had been renewed for an additional year. The bid notice was published in the legal news on July 28 and posted on the city's purchasing website, according to Anthony. But it didn't catch the attention of IPH leadership until after Hollowell's letter arrived.

Anthony admits "the letter should have indicated that the extension would not include all programs." Hollowell's letter, obtained by The Detroit News, did not include that caveat.

"The (request for bids) was published for all potential bidders more than 60 days prior to the end of the current contract," Anthony said when asked if IPH was directly told of the coming changes prior to issuing the notice.

The institute submitted bids for the services, but was not successful. Child health and dental services went to other vendors, and the city says it will rebid the WIC contract because too few qualified vendors submitted bids.

Alexis Wiley, chief of staff for Duggan, said the services had to be put out to bid to comply with state and federal requirements.

"Our law department contacted state officials to find out if we were compliant with state regulation," Wiley said.

"We were given a list of services that we needed to put out to bid."

"It did come as a bit of a surprise, even though we know grants come and go," said Loretta Davis, IPH president and CEO. "Our numbers have been good. We've been providing great service. We thought we'd get another year of providing these services, so this is a disappointment.

"We do have concerns about the transition. We want to make sure people know where to go, where services are so people don't fall through the cracks. We'll keep a close eye on that over the next few months."

kbouffard@detroitnews.com

(313) 222-2661

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