Mayo Clinic and a division of UnitedHealth Group Inc. are partnering on a new system for managing hospital revenue in Rochester, including everything from price estimates before people get care to collecting payment from patients afterward.

Neither Mayo nor UnitedHealth's Optum division, which is based in Eden Prairie, released financial terms for the agreement.

The business unit, which is called Optum360, is an important part of the lineup at Optum, which features health IT and other technology services, said Ana Gupte, an analyst with Leerink Partners.

"They're trying to make headway in that market," Gupte said, noting that large investor-owned hospitals have divisions that compete in what's called the revenue cycle management market.

It's an important area for hospitals, because the growth of high-deductible health plans means medical centers must communicate more clearly with patients about what share of the medical bill patients must cover.

Optum360 helps hospitals with a broad range of functions, including the upfront documentation of care, and billing patients and insurers on the back-end, said Todd Gustin, senior vice president and general manager of the business.

With better documentation of care through medical codes, hospitals can "optimize" or receive appropriate payment for the services they provide patients, Gustin said.

"Within Mayo Clinic, we're going to be deploying our technology platform," he said in an interview. In a statement, Gustin said their services also can "increase timely and accurate payment for services and decrease administrative costs."

The work on hospital revenue is distinct from the two-year-old partnership between Mayo and Optum on a high-profile health care research project called OptumLabs, said Dr. Sandhya Pruthi, medical director for patient experience for the Mayo Clinic in Rochester.

Patients should benefit by better understanding what they owe for care, and what their insurance company will cover, said Pruthi.

"Wouldn't it be nice if we could use computer technology to help estimate the cost of a procedure, factoring in the patient's insurance," Pruthi said. "Not only what they would owe, but also what their insurance would cover and what would be their copay."

Christopher Snowbeck • 612-673-4744

Twitter: @chrissnowbeck