Invoice Factoring for Healthcare Companies

You’re in the business of saving or changing lives. Your mission doesn’t change whether your receivables are paid within five days or 50. And yet, slow payments make it much more challenging to ensure your patients or the medical teams you support receive the treatment they deserve. Invoice factoring for healthcare companies eases the strain by accelerating payment from large payors such as Canadian Medicare, private insurance companies, and other business entities, so you can focus on the essential work you do.

Medical providers that bill Canadian Medicare, private insurance companies, and other large payors may wait weeks or months after providing care before the bill is paid. Meanwhile, the facility must continue paying employees, covering overhead, purchasing supplies, and managing various other expenses related to delivering quality patient care. It’s a difficult spot to be in, and something as simple as an uptick in the cost of supplies, influx of patients, or unexpected bill can make it impossible to make ends meet.

Factoring eliminates your wait for payment by providing you with immediate payment. You’re in control of which invoices you factor and when you factor. As the need arises, you just send your unpaid invoice to your factoring company. They’ll send you a lump sum for most of the invoice’s value right away. When the payor takes care of the balance, you receive the remaining cash minus a nominal factoring fee.

Just about any medical provider that bills the government or large companies can use invoice factoring. A few common examples include:

As a business supporting the medical industry, you rely on prompt payments to continue your important work. Yet, medical providers are often slow payers, and many have long invoice approval processes on top of it. This means you might wait months for an invoice to be paid even though you have your own payroll and operating expenses to keep up with.

Invoice factoring for the healthcare industry can help you too. If you’d like to accelerate payment on any of your receivables, just submit the unpaid invoice to your factoring company. You’ll get most of the invoice’s value right away. When your client, the medical provider, pays their invoice, you’ll receive the remaining sum, minus a small factoring fee. 

Approval for factoring largely depends on your clients’ creditworthiness, so most healthcare-related businesses that serve strong and established businesses are approved. A few examples of businesses that leverage healthcare factoring include:

Medical providers that bill the following provincial healthcare programs may qualify for factoring:

Invoice factoring works differently than any other funding solution, so the benefits your business receives are unique too.

There are no rules on how you spend your cash, so you can apply it wherever it makes the most sense for your business. Businesses in the medical industry often use their cash for:

When you get a bank loan, any personal attention you receive is stacked at the front of the relationship. Once you’ve signed, your relationship is mostly just keeping up with your payments. Conversely, a factoring company is more like a long-term partner. When you work with an invoice factoring company specializing in healthcare, you’ll find that they become invested in your success from day one and can help ensure you have the resources necessary to grow.

The funding process is completely different with invoice factoring than with a loan. Some key differences you’ll notice include:

Another thing that distinguishes factoring companies from banks is their dedication to service. Depending on the factoring partner you select, you may be able to receive the following:

Your funding needs are likely to change over time and as you grow. Once you’re established with a factoring company, you may also qualify for the following:

If it sounds like healthcare factoring is your ideal cash flow solution, take the next step and get a free rate quote.