How to Finance your Medical Office, Medical Supply or Medical Testing Company, Management : iPedia

Although many experts speak of gloom and doom in the medical industry, the fact is that this industry keeps growing by leaps and bounds. Every year, the demand for medical services, medical testing (e.g. MRI Centers, Testing Centers, etc) and medical supplies keeps getting stronger. This trend is expected to continue as the population ages.

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This creates a financial “perfect storm” for medical industry companies. On one hand, you are getting paid less and waiting longer for your money. On the other hand, your operating expenses remain the same or perhaps are higher. You still need to pay your employees and your suppliers. In almost all cases, this limits your ability to pursue new opportunities and grow your business. In some cases, it may even threaten your ability to continue to operate your business.

If your business’s main cash flow problem is not being able to afford to wait 30 to 90 days to get paid by insurance companies and Medicare, then factoring your invoices could be the right solution for you.

The factoring proposition is very simple. Factoring is a way of financing, in which a factoring company provides you with advance payments based on your outstanding accounts receivable (or invoices). You get funding as soon as you invoice. The factoring funds it and waits to get paid until the insurance companies or Medicare pay the invoices.

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The process is fairly simple. Once an agreement is established with a factoring company, it works as follows:

1. Your office submits your weekly (daily or monthly) billings to the insurance company and to Medicare/Medicaid. (note: sometimes this task can be handled by the factor on your behalf)

3. The factoring company advances you up to 85% of Net Collectables within 48 hours. Funds are sent by wire or direct deposit. The remaining 15% is called a “reserve” and used to settle billing discrepancies at time of payment. This is returned to you once the invoices are paid.

4. The factoring company waits to be paid by the insurance company or Medicare/Medicaid.

5. Once the factoring company is paid, they settle out the transaction and rebate you the remaining 15%, less their fee.

Factoring is ideally suited for medical offices and testing centers that are growing quickly and cannot afford to wait the usual 30 to 90 days that it takes to be paid by insurance companies or Medicare. It can provide you with ongoing financing, streamline your cash flow, and most of all, relieve the stress of not knowing when you’ll be paid.

Invoice Factoring Group Invoice Factoring Group (http://factoring.qlfs.com) can provide you with a free medical and doctor office factoring quote. Marco Terry, the president, can be reached at (866) 730 1922.

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How to Finance your Medical Office, Medical Supply or Medical Testing Company

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