Worcester Business Journal

www.wbjournal.com March 2, 2015 • Worcester Business Journal 13 With thanks to our generous sponsors: Keynote Sponsor: Lead Sponsor: Media Sponsor: Patron Sponsors: Featuring Keynote Speaker: Take advantage of networking opportunities, visit exhibitor tables, and attend sessions focusing on: • Visioning Your Future • Starting Your Own Business • Achieving Financial Success • Becoming a Resilient Leader • Creating an Online Presence Don't miss this opportunity to be inspired by television personality, motivational speaker, and business owner, Amy Roloff. Register today at www.empowering-women.biz Only $25 to attend (light dinner buffet included ) Thursday, March 26, 2015 Starting at 2:00 P.M. at Nichols College Center Road, Dudley, MA Amy Roloff See additional sponsors on our website Read more at www.empowering-women.biz "Succeeding as the Entrepreneur of YOU" 2101NC15__EWIB_WBJad.qxp_Layout 1 2/19/15 2:58 PM Page 1 >> H E A LT H C A R E Hospitals keep an eye on Par tners E dward Moore, president and CEO of the Harrington HealthCare System, has been keeping a close eye on developments with Partners HealthCare, the enormous and fast- growing eastern Massachusetts health care system. And, while Partners recent- ly scaled back its latest expansion effort, dropping plans to acquire South Shore Hospital under pressure from state Attorney General Maura Healey, Moore is not letting down his guard. "We don't have our head in the sand, thinking that con- solidations won't continue to happen," he said. Moore said Harrington is determined to stay an "inde- pendent, nonprofit, commu- nity health care system." Every word in that description is important, he said, and the number of hospital systems that can be defined that way is declining. Some have merged with, or been acquired by, other systems and others have gone bankrupt. Harrington and other remaining independent hospital systems in Central Massachusetts are facing the consolidat- ing market head-on. They've found ways to work together with each other, and with the larger systems around them, to stay competitive. Partners' expansion efforts, and the way they've been partially thwarted, show just how fraught the issue of consolida- tion can be. The system was created in 1994 through the merger of Brigham and Women's and Massachusetts General hos- pitals. Since then, it's acquired other hos- pitals around eastern Massachusetts and become the largest private employer in the state with 60,000 workers. Brigham and Women's and MGH also charge some of the highest rates in the state for medical procedures, and gain- ing more market share could allow them to raise prices even more. Last year, then-Attorney General Martha Coakley reached a deal with Partners to allow the system to acquire South Shore, as well as two hospitals operated by Hallmark Health. The plan included some restric- tions on price hikes and further expan- sion, but some observers warned that might not be enough. Some projected that the consolidation might lead to higher prices and hospital closings. When Healey took over from Coakley in January, she essentially nixed the deal. Partners has now dropped the idea of taking over South Shore, though it may continue with the Hallmark acquisition. Affiliations with bigger players Partners doesn't directly compete against any Central Massachusetts hos- pitals, but independent medical centers here have been working to make sure patients have access to the sort of spe- cialized services that larger systems provide. Harrington partners with another big Boston hospital, Beth Israel Deaconess Medical Center, to read its radiology images. It also works closely with Central Massachusetts' own big health care system, UMass Memorial Health Care. UMass specialists can monitor Harrington patients remotely through the system's eICU, and UMass oncologists serve Harrington's cancer center. Aside from forming part- nerships with larger systems, Harrington also works with Heywood Healthcare, which runs hospitals in Gardner and Athol, collaborating on some information systems to keep costs down. "We look at those as win- wins so we can continue to stay independent and sup- port the local community," Moore said. At one of the only other remaining independent hospitals in the region, Milford Regional Medical Center, President Edward J. Kelly said it's been relatively easy to resist absorption by a bigger system because its coverage area straddles the line between eastern and central Massachusetts. "It would be hard for us to be solely with one system because of our geogra- phy," he said. Like Harrington, Milford works with some of the big guys, including UMass and Boston Children's Hospital. It also runs a cancer center in partnership with Dana-Farber and Brigham Women's. Impact on the books Beyond operational considerations, hospital consolidation affects the finan- cial side of health systems as well. One of the arguments against Partners' expan- sion is that larger systems have more leverage to pressure insurers and gov- ernment payers such as Medicare to accept high prices. Moore said it's true that small systems such as Harrington have more trouble in fee negotiations. "Are we paid adequately for what we do? No. We would like to be paid better," he said. "But I would be the first to tell you, it's a complicated issue." Teaching hospitals with specialized services have bigger expenses, and the costs tend to be spread out over all the services they provide, driving fees up. UMass Memorial Medical Center in Worcester is the most technically BY LIVIA GERSHON Special to the Worcester Business Journal In an era of consolidations, smaller independent providers stay their course >> Continued on Page 14 Edward J. Kelly, president of Milford Regional Medical Center, says geography works in the hospital's favor.

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