Collecting on past due accounts is one of the biggest challenges that medical providers face. Whether you’re a dentist, doctor, optometrist or podiatrist, the story is often the same: You come to the end of the month only to discover that dozens of your patients have not yet paid for their medical services.
Unfortunately, tracking down this owed money is no easy task. Many clients simply don’t want to pay. They don’t make it easy on your staffers who, frankly, would rather be performing their other duties.
Fortunately, there is a solution: medical receivable factoring.
This is actually quite a simple arrangement for medical providers. You simply sell at a small discount your receivables to an outside factoring firm that specializes in the medical arena. The factoring firm then handles the work of collecting the money that your clients owe. Because the factoring firm once it collects keeps the full face value of the receivables it bought from you at a discount, it makes a profit. Meanwhile, you get at least most of the cash that your clients owe you. This makes your medical office far more liquid, and makes paying your own bills an easier task.
Yes, you will lose out on some of the money you are owed when you sell your receivables at less than face value to your factoring company partner. But by taking this cut, you are saving yourself an immense amount of frustration and wasted time. You also eliminate the stress of worrying over whether your office is financially liquid enough to meet its monthly financial obligations.
The next time, then, that you struggle to collect from a client who is simply unwilling to pay, consider investigating medical receivable factoring. It just might be the best business decision you make this year. Find out more information about accounts receivable factoring.
