The healthcare industry provides one of the most important services that people need. If you run your own medical clinic, you have the privilege to care for people and restore them to good health. Unfortunately, in the healthcare industry, it takes an unbelievably longtime for you to actually get your fees from the insurance companies. And that’s why medical accounts receivable financing is so important—and all too common.
Obtaining Funding with Your Accounts Receivable
As every healthcare provider knows, Medicare, Medicaid, and private insurance companies take quite a bit of time to cough up the money to pay for your services. These institutions (especially insurance companies) are much more adept in receiving money from clients instead of paying out claims. This delay can truly have some terrible consequences for your clinic.
Accounts receivable financing is one way to solve this. Instead of waiting for an interminable amount of time to get your fees, the finance company can forward a percentage of the accounts receivable to you immediately. You can then get as much as 90% of the value of the invoice right away. The rest of the money will be sent to you by the finance provider once the insurance company has finally paid in full. The company takes a small percentage from that payment.
Advantages of Accounts Receivable Financing for Healthcare Providers
So why should you consider accounts receivable funding? There are several notable advantages:
- The application process is very easy and quick. You can get the financing you need even if you are just starting up your company. The approval rate for this kind of financing is much greater than getting a loan from a bank. Your credit doesn’t affect your chances of getting your money.
- This financing does not involve getting into debt. Thus, it doesn’t have any further effect on your credit rating.
- You can use the money for a lot of things for your clinic. You can use the money to cover your payroll. You can use the cash to hire more people or renovate your clinic. You can buy more equipment so that you can improve or expand the services you provide.
- You can use the finance company’s services as a way to solve many of your collection problems. You won’t have to hire personnel to deal with insurance companies to get your fees. Instead, the finance company can do that service for you. They have the skills and the experience for that sort of job.
So if you want to improve your amount of ready cash for whatever need you have for your clinic, a traditional bank loan may not be your best option. With medical accounts receivable financing, you can get exactly the amount of money you need by using your invoices as a means to get funding.
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