University Medical Resident Services, P.C. - Page 8

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          assigned to the appropriate hospital.  The Consolidation Contract             
               The parties recognize that, due to the fact that the                     
               employment of the * * * [residents] is ancillary to the                  
               primary purpose of graduate medical and dental                           
               education, the selection, credentialing, academic                        
               instruction and supervision of the * * * [residents]                     
               is, to a large extent, uniquely within the province of                   
               * * * [the University] and * * * [the Consortium],                       
               subject to the legal obligations of the respective                       
               Teaching Hospitals to supervise professional practice                    
               and other matters within their respective facilities.                    
               Accordingly, it is contemplated that * * * [UMRS] and                    
               * * *[UDRS] would have limited input into the process                    
               selecting the individuals comprising the Housestaff                      
               * * *.                                                                   
               The Consolidation Contract also states that petitioners have             
          the power to “hire and fire” residents.  The affiliated teaching              
          hospitals, however, supervise the residents and have the right to             
          refuse to accept the assignment of a particular resident.  The                
          Consortium and the affected teaching hospital have the right to               
          discipline residents.  The Consolidation Contract provides that               
          petitioners are not legally liable for lawsuits resulting from                
          such disciplinary actions.  The Consolidation Contract further                
          states that each hospital must provide medical malpractice                    
          insurance for the residents working at its facility and must                  
          indemnify petitioners for all liability arising out of alleged                
          malpractice on the part of residents.                                         
               Once a resident is selected and allocated to a member                    
          hospital, the relevant petitioner assumes responsibility for the              
          payment of all wages, benefits, and related payroll taxes and                 

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Last modified: May 25, 2011