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.
How Healthcare Factoring Works
Invoice factoring is leveraged in many industries. In a traditional arrangement, the business sells its unpaid receivables to a factoring company at a slight discount. The business receives most of an invoice’s value right away. Then, when the client pays their invoice, the factoring company remits the remaining balance to the business minus a nominal factoring fee.
Healthcare factoring works essentially the same. However, because there are medical providers who receive payments from Canadian Medicare and private insurance companies, as well as businesses that support the healthcare industries that receive payments from medical providers, there are a few minor differences.

Invoice Factoring for Medical Providers
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.
Types of Medical Providers That Use Invoice Factoring
Just about any medical provider that bills the government or large companies can use invoice factoring. A few common examples include:
Invoice Factoring for Healthcare-Related Businesses
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.
Types of Healthcare-Related Businesses That Use Invoice Factoring
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:
Benefits of Invoice Factoring for Healthcare Companies
Invoice factoring works differently than any other funding solution, so the benefits your business receives are unique too.
How Healthcare Factoring is Used
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:
Bank Loans vs. Invoice Factoring for Healthcare Companies
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.
Healthcare Invoice Factoring is Different
The funding process is completely different with invoice factoring than with a loan. Some key differences you’ll notice include:
Leverage Value-Added Services to Strengthen Your Business
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:
Explore Additional Funding Solutions for Your Healthcare Business
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:
Request a Free Medical Factoring Quote
If it sounds like healthcare factoring is your ideal cash flow solution, take the next step and get a free rate quote.