San Francisco-based Dignity Health and Minneapolis-based Optum have created a new joint venture company, Optum360, that will focus on modernizing registration, documentation, billing, payments and other revenue cycle areas for other hospitals and providers.
Optum, a subsidiary of health insurer UnitedHealth Group, will have a majority stake in the new company, according to Dignity Health's most recent financial filing. Dignity Health, which has more than three dozen hospitals across Arizona, California and Nevada, agreed to contribute equipment and intellectual property to hold a noncontrolling minority stake. Under the master services agreement, Dignity Health will pay $250 million per year over 10 years to obtain the revenue cycle services from Optum360, and health system officials said they expect "to achieve gains" in both revenue and assets.
Overall, Optum360 will include 3,000 employees — 1,700 employees from Dignity Health and 1,300 from Optum.
Officials from Dignity and Optum, a subsidiary of health insurer UnitedHealth Group, said they wanted to create a revenue cycle initiative so billing could be simplified, thus making the hospital process better and less stressful for patients.
"Dignity Health has always been committed to simplifying the billing process and helping our patients understand their health benefits," said Michael Blaszyk, CFO of Dignity Health, in a news release. "With Optum360, we are taking these efforts to the next level by implementing Optum's proven technology. We are excited to bring these resources to the patients we serve as well as to the broader healthcare marketplace."
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