Many members of the healthcare community, be they physicians, practice managers, hospital administrators, etc. may not be familiar with how accounts receivable financing can be a strategic business option to remedy cash flow issues. The following is intended as a brief explanation of common questions asked. Please contact us at Asset Based Capital Healthcare (ABCH) if you have any further questions.

1.  What is medical accounts receivable Financing?

A. Medical accounts receivable funding is the sale and purchase of an asset at a discount.  Instead of waiting 60 – 90 days, for 3rd party payors (insurance carries, government, etc.), medical accounts receivable is a financial tool that allows you to sell your accounts receivable for cash now.  Unlike other methods of financing your medical business, you incur no debt on your balance sheet.


2.  How does the purchase of your medical accounts receivable resolve your cash flow problems?

A. You receive payment immediately and therefore are able to use the cash in ways that will strengthen your business: i.e. advertising, purchasing new equipment, bringing in personnel, etc.


3.  What will it cost me?

A. As one might expect, the cost can vary depending on a variety of factors including the average size of the receivables, average turnaround time, volume financed, etc. the only reliable approach to learning your specific costs is to complete a no obligation application and allow us to determine your cost based on the particular circumstances of your operation.


4.  How is the benefit of having my accounts receivable purchased better than taking out a loan at the bank?

A. A significant difference is that a loan at your bank is reflected on your balance sheet as debt, whereas having your accounts receivable purchased is a prudent use of your assets. In addition, while incurring debt at your bank requires repayment of the debt with cash, accounts receivable financing requires no repayment and no cash drain. Each successive week generates new receivables which we continue purchasing, thereby providing you with a reliable stream of cash.


5.  If I were to sign on as a client, how long until my cash flow problems disappear?

A. Once approved (including the due diligence period), generally you can get a wire transfer of funds into your business account within hours of our decision. This amount would be an immediate infusion of cash. The subsequent funding would then occur on a time table that works best for you on a weekly, bi-weekly, monthly basis or even a seasonal basis, thereby providing you with a regular stream of cash.


6.  Is the purchase of accounts receivable considered a short or long term solution?

A. It could be both depending on how it is used. It provides an immediate infusion of cash, which solves the immediate crisis of poor cash flow and provides for regular cash flow throughout the course of the year.


7.  Why is ABCH the preferred choice when considering the purchase of my accounts receivable?

A. Unlike other companies, ABCH through their affiliates can offer a variety of financing programs. Verses a take it or leave it approach a specific company may offer. Our interest is keeping you as a long term relationship for your Medical / Healthcare Financing source.


8.  What size practices do you fund?

A. We are able to assist practices that have $10,000 – $100,000,000 in net monthly collections. Because of  ABCH affiliates we are able to offer the best pricing for your practice.


9.  Is there a downside to purchasing accounts receivable?

A. More of a tradeoff than a downside. What occurs is that you gain the quick influx of cash and pay for it with a slight loss in the total accounts receivable collected over the long term. The ability to use the funds while otherwise waiting for payment from third party payors, places you in position to better pursue improvements to your practice–be they additional personnel, increased advertising, taking advantage of cash discounts, improving your credit rating, etc. All these steps would be impossible without the cash realized from this process.


10. What is your turnaround time?

A.  Typically, as little as 15 business days following our receipt of the completed application. We are committed to getting an answer back to you as quickly as possible. If an arrangement is delayed, often it is due to additional time to get information to us. The sooner we receive the required information, the sooner we can act upon it. An on-site due diligence visit is required prior to the final decision being reached. This is to confirm the information submitted in the application as well as to perform other due diligence activities.


11.  Who do you provide financing for in the Medical / Healthcare Industry?

A. ABCH focuses strictly on providing financing options to the medical / healthcare industry, meaning physician private practices, group practices, clinics, DME providers and other providers within the medical/healthcare arena.


12.  How long of a commitment does this represent?

A. One year typically. Frequently, two to five.


13.  How quickly can you provide a preliminary indication regarding our working together?

A. We are committed to responding within 48 hours to those who complete an application.