Medical practice funding can come in many forms from a variety of sources.
If you’re considering whether to apply for medical practice funding, it’s important to understand the various ways different forms of funding can be used. Certain forms of financing are created specifically for activities like purchasing equipment or acquiring a medical practice, while others are more general and suitable for use as working capital.
Understanding ideal uses and knowing what you can use your funding for will help you decide which medical practice funding option best suits your needs.
Medical practices can use additional funding for a number of purposes. Here are 10 of the most popular uses:
1. Purchasing inventory
Medical supplies, including PPE, are a costly but necessary expense. Maintaining inventory can be challenging if cash flow is hampered by slow insurance payments or difficulty collecting client payments.
2. Purchasing or repairing equipment
Medical equipment often carries a prohibitively high upfront expense and can be costly to maintain and repair. Medical practices may need funding to help support these investments or cover unexpected repair costs.
3. Upgrading technology
Digitizing medical records improves efficiency by streamlining billing and patient communication, as well as making it easier to share information between physicians. New technologies can also help you offer more services and attract new patients. However, the upfront investment of upgrading and adjusting this new technology and software can strain your cash flow.
Slow-paying insurance companies, delays in Medicare and Medicaid reimbursements, or non-paying clients can all create cash flow concerns for medical practices.
Medical practices have different insurance needs from standard businesses, such as malpractice insurance and worker’s compensation for illness. This can make their insurance especially expensive. Medical practice funding can help you cover insurance payments and premiums when cash flow is limited.
6. Investing in real estate
Purchasing office space can lower your monthly expenses and expand your assets. Investing in real estate can also help you grow your practice to a new location or renovate your existing office to create a more comfortable environment for patients.
7. Acquiring another practice
Purchasing an existing practice from a retiring physician is a practical alternative to starting your own. It may also be an easier way to expand your practice by enabling you to serve new territories, offer new services, or acquire new patients without investing heavily in marketing.
8. Hiring staff
Adding more doctors, nurses, and support staff to your team allows you to take on more patients. However, finding talented clinical staff can be challenging for smaller practices without the budget to compete with the pay and benefits of larger organizations.
9. Boosting marketing
Whether you’re opening a new practice, expanding to a new one, growing your current patient roster, or offering new services, both traditional advertising and digital marketing methods can help you reach new patients and generate more revenue.
10. Improving patient services
Offering current and sought-after patient services like online booking and paperwork, real-time wait times, fast response time and free wifi, helps keep your practice competitive. However, these services can be costly to implement. Medical practice funding can help get you up and running—and earning more—without straining your cash flow.
Get the medical practice funding that’s right for you
Traditional lenders like the SBA and banks have the lowest rates and longest terms, but they are difficult and time-consuming to secure. Additionally, due to their strict requirements, many applicants are rejected. Alternative lenders have more flexible requirements, allowing them to approve more medical practice loans faster, with funds deposited in as little as 24 hours.
Several kinds of physician funding are available from alternative lenders like Greenbox Capital®, including merchant cash advances, online invoice factoring, alternative business credit, collateral business loans, and term loans, with funding from as low $3,000 up to $500,000 and no restrictions on how funds are used.
About the author
Alfredo Rosing is the Vice President of Marketing at Greenbox Capital®. With over 25 years of combined experience in marketing and financial services, Alfredo is an expert on innovative financial technologies with a passion for connecting consumers and businesses with socially responsible funding. Prior to joining the Greenbox Capital team, Alfredo launched an award-winning online lender that was recognized as the winner of the 2017 Fintech Awards US Firm of the Year for Lending Innovation Award. Alfredo is a graduate of Southern New Hampshire University with a BS in Marketing.