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Worcester Business Journal • www.wbjournal.com • 2017 Economic Forecast 25 H E A LT H C A R E Market disruption Next year will bring more upheaval to the regional healthcare industry I n an interview this fall, Massachusetts Health and Hospital Association President and CEO Lynn Nicholas said we're only seeing the tip of the iceberg when it comes to changes in Massachusetts health care. With hospital mergers, affiliations and expansions already on the table for a number of Central Massachusetts providers, Nicholas is almost certainly right. If 2016 was a bustling year for this industry, 2017 will at least keep pace and it may be even be more disruptive, as brewing plans come to pass. Here are some important topics to follow next year. Mergers & affiliations There are some major Central Massachusetts deals pending that will tighten the web of healthcare providers in the Bay State. HealthAlliance Hospital in Leominster and Clinton Hospital, both part of the UMass Memorial Health Care system, received preliminary approval to proceed with a merger last month. Meanwhile, Steward Health Care is vying for a simi- lar stamp of approval from the Health Policy Commission to acquire the 200-member Central Massachusetts Independent Physician Association, potentially bringing a big Boston player into the region. And a clinical affiliation expected to move forward between Framingham-based MetroWest Medical Center and Boston's Beth Israel Deaconess Medical Center, owned by Partners HealthCare, would add dimension to the provider mix. Community-based expansion Community-based health care will continue to grow. Providers are casting wider nets and looking outside the hospital to increase patient volume, and beefing up services in areas that have been historically underserved. For instance, Southbridge-based Harrington HealthCare, a relatively small player in Massachusetts, is weigh- ing building new offices in Northeastern Connecticut. And new urgent care centers have continued to open in and around Worcester, driving patient volume into healthcare systems. More risk For years, pro- viders have been heralding the coming of risk- based contract- ing as the new method for insurers to pay providers for their services. Encouraged by federal healthcare reform, risk-based contracts reward providers for taking care of patients on a budget. These arrangements are expected to become more widespread in Massachusetts, thanks to an overhaul of the state's Medicaid program, MassHealth. Experts have said that with MassHealth transition- ing to risk-based contracting, the balance may begin to tip toward this payment method, and away from fee-for-service payments, which have dominated until now. Harrington CEO Edward Moore ran over final details with the staff of the UrgentCare Express in Oxford in the week leading up to the healthcare system opening the location in November. UMass Memorial expands downtown Worcester presence UMass Memorial Health Care has added nearly 18,000 square feet to its new IT offices in the Mercantile Center in downtown Worcester. The addition expands the provider's footprint in the downtown building by 20 percent, according to Franklin Realty Advisors Inc., the developer. UMass Memorial spokesman Anthony Berry said in an email that the system will begin moving its IT depart- ment into the Front Street offices by the end of the month. The move is designed to centralize IT operations as UMass Memorial revamps its IT infra- structure, a $700-million project announced last year. Berry said the first phase of the move was expected to by complete by the first week of December, when UMass Memorial will occupy most of the sec- ond-floor of the building at 100 Front Street. There's more work to be done before the IT office move is complete. Berry said construction of the new offices is still underway, and the second phase is expected to be complete by the end of May, he said. When complete, about 500 employees will be housed in the new location. The UMass Memorial expansion announcement is part of a series of developments for Mercantile Center. Kelleher & Sadowsky Associates, Inc., the office-leasing agent for Mercantile Center, is moving its headquarters to 120 Front Street in early 2017. The firm will phase into 7,380 square feet over a three-year period, according to Franklin Realty. Sheehan's, the Rhode Island- based office furniture dealer, will take a portion of the KS space and will use the space as a working showroom for its products, while the Worcester County Registry of Deeds, located in 100 Front Street, is extending its lease for five years, according to Franklin Realty. P H O T O / N A T H A N F I S K E Top health care stories of 2016 BY EMILY MICUCCI Worcester Business Journal Staff Writer UMass Memorial - Clinton Hospital MedPost opened three clinics in Wayland, Northborough and Franklin this year. UMass is leading MassHealth's over- haul in Central Massachusetts. W Continued on Page 26 UMass Memorial is growing its presence outside of its North Lake Avenue location in Worcester.