Critically ill babies born in the Intermountain Region will no longer be transported to Utah hospitals by a world-renowned air ambulance team employed by the University of Utah Hospital unless an agreement under negotiation between the U. and Intermountain Health Care can be reached by Friday.

The proposed agreement, U. officials said, would allow the U.'s 12-member Neonatal Transport Team to be employed by the U.'s Department of Medicine and yet be compensated through that department by Primary Children's Medical Center, an IHC facility.U. hospital spokesman John Dwan said Wednesday that the concept of the agreement has been approved. Lawyers, however, were deadlocked over legal and financial details.

Dwan said that attorneys for both hospitals specifically were trying to determine if members of the neonatal transport team can be employed by one medical facility and paid by another without violating federal antitrust laws.

Meanwhile, members of the U.'s Neonatal Transport Team were in a state of shock Wednesday night when an agreement had not been reached. The long-term contract between the U. and Primary Children's involving the team expired at midnight Wednesday.

A member of the transport team, who wished to remain unidentified, said nurses were told Wednesday that Bill Evans, an attorney representing the U. in the attorney general's office, had issued a letter stating that the proposed agreement was not workable - and could well be in violation of antitrust laws.

"We therefore have been given two days to decide if we want to be IHC employees or look for other employment," the nurse said. "We are extremely depressed. You are looking at employees who have worked for the U. for 10 to 15 years and have accumulated a large number of benefits."

The nurse said the U. has offered them jobs in the hospital. Meanwhile, Primary Children's is creating its own neonatal transport team - which could include some of the personnel from the U. if they choose.

Dwan said that since the late 1960s, the U.'s neonatal transport team - an arm of AirMed - has had the contract to transport babies. Primary Children's Medical Center has maintained a pediatric trauma transport unit for older children. However, even though the U. team was doing the transporting, the majority of the babies have gone to Primary Children's, Dwan said. "Eighty-five percent have historically gone to Primary simply because that's where the personnel and services were to fill their particular need - particularly pediatric anesthesiologists and surgeons," he said. "We would get the overflow when Primary was full. That doesn't happen now because it (Primary) has expanded its capacity."

According to Dwan, 1 1/2 months ago the U. Hospital made a business decision to get out of the neonatal transport business. Area neonatologists - the doctors throughout the Intermountain Region who decide where babies are treated - wanted to consolidate the neonatal transport team at the U. with the pediatric transport team at Primary "so they could be cross-trained and more efficient," he said.

"The U. Hospital decided to go along with that proposal, because if we had decided to keep that team we frankly wouldn't have had any business. We really had no choice," Dwan said. "We would have probably have had to lay off the nurses because we wouldn't have had anything for them to do."

But, Dwan said, the neonatal transport team wanted to remain U. employees to keep U. benefits.

"Most are long-term U. employees and the benefits are good. So we came up with an arrangement to take care of the nurses," he said. "If we hadn't done it we would have ended up with a transport system with nothing to do."

Dwan said it's impossible to determine if more babies will go to Primary in light of the proposed new transport agreement.

"They will still go where they will get the best care," he said. "The public should be aware this is an administrative reorganization. The patients are still going to get the highest quality of care."

For several months, the attorney general's office has been investigating whether agreements between the U. Medical Center and IHC, Utah's largest health-care conglomerate, may violate antitrust laws.

Jonathan A. Dibble, private counsel appointed to represent the U. Hospital during the investigation, said Wednesday night he had not studied the proposed agreement. He said he, therefore, could not issue any legal opinion regarding it until meeting with U. officials Thursday. A meeting with the attorney general's office has also been scheduled next week, he said.

Arthur M. Strong, chief of the fair-business enforcement unit of the attorney general's office, acknowledged he has received a copy of a proposed agreement relating to neonatal transport services historically provided by the U. Hospital.

"We are not going to be giving an opinion to the U. or Primary on the antitrust complications. Mr. Dibble is counsel to the U. on this matter. But we are planning to meet with the U.'s attorney's next week to explore our concerns," Strong said.

The proposed agreement, obtained by the Deseret News, was signed by members of the U.'s Neonatal Transport Team. It was also signed by Dr. August Jung, director of the U.'s Division of Neonatology, and by Dr. Michael A. Simmons, chairman of the U.'s department of pediatrics and medical director of Primary Children's Medical Center.

But other doctors said the agreement raises further concern about possible antitrust violations between Primary Children's and the U. Medical Center.

The agreement, they say, could also mean that even more critically ill babies will be transported to Primary Children's newborn ICU, at a time when the U. hospital is crying financial woes - which hospital officials once said was caused by a decreased census in the facility's newborn intensive-care unit. In an Aug. 30 administrative memo, U. Hospital Administrator George W. Belsey told hospital service directors that since Primary Children's moved to the U. campus this year, substantially fewer babies have been treated in the U.'s newborn intensive-care unit.

Because of the decreased census, Belsey said it was essential that the U. Hospital raise patient rates by 5 percent to "offset the losses incurred resulting from the reduction in the neonatal area."

Dwan now says that memo was incorrect.

"It's the general consensus among management that the memo that went out earlier was a mistake; it wasn't a full and complete explanation of why we had to raise our rates," he said.

"Loses in the neonatal unit weren't a major factor in why the U. had to raise rates. In discussions of that, there were varied factors - what was happening in the neonatal unit was not a major factor. One of the major problems is lack of reimbursement from Medicaid and Medicare."

Dwan said the U. is getting more of "these patients and getting paid less for them. That is why our costs are going up."