Medical factoring is a flexible financing solution that allows healthcare providers to sell outstanding patient invoices to a healthcare factoring company in exchange for upfront capital.

Unlike traditional financing options such as a bank loan or a line of credit, medical receivables factoring does not involve your business borrowing money. Rather, it’s you getting paid for the service you’ve already provided, sooner.

Medical factoring companies like REV Capital can factor receivables for most healthcare services including medical service and goods invoices, patient invoices, insurance invoices, other third-party payer invoices, and more.

Generally, the rates for healthcare factoring fees range from 1% to 5% of the invoice value. Some healthcare factoring companies may also charge late payment fees or service fees on top of the factoring fee. However, the exact value depends on your signed agreement.

If a healthcare client fails to pay the invoice after factoring, either you or the medical receivable financing company will assume the loss depending on your agreement.

In a recourse factoring agreement, your healthcare business must buy back any unpaid invoices. In non-recourse factoring, healthcare factoring companies assume the risk and you will therefore not be asked to repay the uncollectible invoices.