If you’re a physician or a healthcare professional who accepts insurance as reimbursement for your services, you’ll be all too familiar with the slow and repetitive rate at which the payment cycle is completed. The healthcare practitioner may have to wait up to four months for the transaction to be completely finalized and completed.
In the meantime, you’ll need to have enough working capital on hand to pay employee salaries, equipment, and miscellaneous expenses, not to mention rent and electricity. Even if you have a sizable cash balance, the unacceptably long periods it takes for the payment cycle to properly complete will rapidly reduce it to near-critical amounts.
Medical factoring is a straightforward solution to your problems. Using this healthcare factoring companies service, you will be able to free up the cash you are legally permitted to, ensuring that the company’s financial health is protected at all times and that you are not faced with the logistical problem of a last-minute cash crunch.
- One of the most remarkable and obvious advantages of using medical factoring is that the entire insurance payment processing method is greatly improved, resulting in significantly decreased downtime, which is oftentimes additive.
- You will get your insurance payments as quickly as possible when you use medical factoring.
- This method of business financing is much more straightforward and effective than obtaining a bank loan that needs more requirements.
- By using medical factoring service, you can also secure your fixed assets as collateral even you run out of them.
- The medical office, or a member of staff working on its behalf, would be allowed to send the patient’s claim to the insurance provider.
- The factoring company receives a copy of the insurance claim that has been sent by insurance company and uses it for record-keeping and recovery of money owed.
- The healthcare factoring companies will provide a defined amount of the balance of the claim to the medical office after receiving a copy of the insurance claim.
- When the insurance provider pays out, the factoring company will take the entire amount of the settlement and release the funds owed to the medical office, after reducing their service charge.