Wednesday, November 16, 2011

Factoring For the Medical Industry

One of the biggest challenges for providers in the medical industry is waiting to get paid by 3rd party medical insurance companies (or government insurance companies). This creates can flow problems which affect small and medium size medical providers, nursing homes, DME's that can't afford to wait because they have limited resources.

One way to solve this problem is to use medical factoring. Medical factoring accelerates your revenues due from insurance claims, providing the cash flow you need to meet your operational expenses and grow the business. And as opposed to conventional business financing solution which are difficult to qualify for - factoring is relatively easy to obtain. The biggest requirements are that:
  • Your company needs to work with credit worthy insurance carriers (or Medicare/Medicaid)
  • Your company needs to be free of legal and tax problems
  • Your company needs to have solid billing practices
One advantage of medical factoring is that it's very flexible - the financing line grows with your business. This makes it an ideal solution for medical providers whose growth is being constrained by cash flow problems.