Medical Clinics Business Loans

Learn How a Business Loan Can Help with Collections for Medical Clinics

One of the challenges for any medical clinic is to receive payment for services rendered. This task becomes even more complex as health insurance providers include high deductibles and more patient co-pays. Clinics must find ways to increase cash flow while improving the processes for collections.

Provide Multiple Payment Options

In the past, you had the option to pay with cash or check when you went to a doctor or other healthcare provider. Most clinics today accept credit and debit cards as well. Consider other payment options to help ensure timely receipt. 

One option for collections is to present any returned checks on specific days for a higher chance at payment. In the past, the check would automatically be returned the next day, which means the account probably still doesn’t have the funds. Now, some systems will hold a check until a certain day. You can select a date like the first or end of the month to increase chances of funds being available. 

Online payments also make it easier for a patient to pay their bill on time. Instead of mailing payment which may not still be available, the patient can go online and use a credit or debit card to make a payment that will come out of the account immediately.

Ask for Advance Payment

Some clinics are choosing to ask for a higher payment upfront when services are rendered. If they need a procedure, it is paid for before being scheduled. This ensures the patient can focus on recovery and the clinic doesn’t waste resources trying to get paid for a procedure they have already provided.

For those procedures which are even more costly, some clinics are creating accounts for prefunding. The patient can pay in over a period of weeks or months until it has been paid in full. The clinic may even offer a discount for pre-payment as an inventive. The clinic still comes out ahead because they don’t waste money trying to chase down payments.

Improve Collections Processes

One of the best ways to reduce the timeline for receiving payments is to review current processes with billing and collections. It’s not uncommon for the patient to receive a bill months after the procedure, which makes it less likely they will make the payment. 

Instead, reduce the timeline and start sending out invoices quickly after the services have been rendered for the patient’s portion of the bill. Use new technology to automate as much of the process as possible, which will also contribute to shorter timelines. 

Offer e-statements and other electronic methods of invoice delivery to reduce the time it takes to receive payment. Automated services help increase the percentage of payments made and decrease the time it takes to receive them. 

Even as you implement new strategies to reduce the time it takes to receive payment, you will still have instances when payments will be delayed. A clinic must continue to be able to function and pay its own bills even when cash flow is restricted.

Have a Contingency Plan in Place

Even as you implement new strategies to reduce the time it takes to receive payment, you will still have instances when payments will be delayed. A clinic must continue to be able to function and pay its own bills even when cash flow is restricted.

It’s important to have a contingency plan in place for cash when accounts receivable is behind. A healthcare business loan can help a clinic or medical practice meet expenses until invoices have been paid. 

Alternative lenders that offer small business loans can provide financing in a short time frame. Instead of taking days and even weeks to get approved for a traditional bank loan, Fast Track Lenders can approve financing in less than 24 hours. Once the application has been approved, the loan may be funded in one or two business days

This strategy allows you to wait until the last minute on invoice collections and to request only the amount needed for expenses. As you improve your collections methods, you’ll discover that you need fewer loans to help keep operations moving smoothly. 

Even though medical practices and clinics provide a service to patients, they must think like a business. Collections is an integral part of the success of a clinic, and it’s also necessary to have a backup plan when invoices are not paid on time. Medical practice loans can take the stress off until collections’ practices are successful.

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