Medical Factoring

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Medical factoring is defined simply as payments owed to health care providers and health-related manufacturing companies by insurance or government entities. Medical  receivable factoring  (also called medical receivable financing) allows you, the payee, to receive immediate cash for billings to 3rd-party payers. These 3rd-party payers include insurance companies such as Blue Cross/Blue Shield and PPO’s, as well as government agencies like Medicare and Medicaid.

Medical receivables factoring helps you to maintain proper cash flow to keep up your high level of care, meet payroll, make mortgage or rent payments, expand your business, etc.  This stable cash flow helps you to deal with the uncertainty and delays that are frequently associated with receiving payments from insurance companies and government agencies. Seascape Capital will always facilitate your medical receivables factoring in a professional and courteous manner.

Basically, medical factoring involves us paying you within 48 hours of you sending out a batch of invoices. You would receive a certain amount of that invoice up front (typically 75-85%) and the remainder when the invoice is paid, less the fee that we have agreed upon. Factoring is available for almost any size of company but is typically most cost effective for those companies billing out at least $100,000 per month or, if smaller, in a high growth mode.

Whether you are a leader of a hospital, small clinic, durable medical equipment (DME) supplier, or other medical-related business, we can assist you.   If you are growing rapidly or need more working capital than your current cash flow provides, please contact us.

  The benefits for you include:

  • Creating solid, dependable cash flow
  • Getting assistance with collections
  • Maintaining your credit rating by paying bills promptly and improving your balance sheet (no increased debt)
  • The option of offering your customers better credit terms

 

How Much Does It Cost For You

The fees charged for providing you with advance funding of your receivables differ based on such items as:

  • Number of days from purchase until payment received
  • Monthly volume (dollars)
  • Total number of billings per month
  • Average size of each claim

 

 

   The Process

While the process will vary based on individual circumstances, a “typical” scenario entails:

  1. You submit an application and we (the  underwriter, you, and us) then teleconference to review your situation, answer questions, etc.
  2. We conduct our due diligence, which includes a review of your documentation. This is the most time consuming part of the process and generally takes 1-2 weeks.
  3. You receive an advance of, typically, 75-85% of the net value of your accounts receivable.
  4. Your payers send their bill payments to a lockbox established just for this account. As payments are received, you are reimbursed the remaining amount less the agreed upon fees. You continue to receive advance cash on your receivables on a weekly or monthly basis.

Complete our Factoring Application for more info.

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