As a business owner in healthcare, you know how important it is to manage your working capital. Simply put, working capital is current assets minus the current liabilities. Working capital is the money on hand that keeps you in business. It is cash to pay bills, purchase inventory and pay employees.
If you don’t have enough money coming in, it can become difficult to pay employees, maintain inventory levels, pay your operating expense and other monthly obligations you have.
There are numerous reasons that contribute or cause cash flow interruptions –seasonality insurance payment issues, patients not paying bills on time, or an unexpected pandemic that interrupts the entire world. As a medical practice owner, you’ve most probably experienced a cash flow interruption – and you know how stressful and harmful it can be to your business.
At Hippo Lending, we understand that cash flow is vital for any healthcare practice –we are here to help businesses get through these difficult periods of cash flow interruption. A few ways to optimize and improve your working capital so you can thrive during uncertain times in your business.
Stay on top of your billing and reimbursements from insurance companies.
Waiting on insurance companies to pay claims submitted can be long, and delays can impact your working capital. If insurance companies are taking too long to process claim payments, there’s a chance that your cash flow will be affected. This puts you in a less-than-ideal situation due to the strain on your working capital.
To reduce reimbursement delays, make sure your billing staff is well trained in claim preparation and submission. Diagnosis codes can be complicated, submitting accurate information to the insurance company will minimize payment delays. Billing mistakes prolong the reimbursement process and affects your working capital. If claim issues arise, they should be addressed, corrected and resubmitted as soon as possible.
With insurance plans today patients will often have a co-pay, a deductible to meet or will pay out-of-pocket for services. If this is the case, collecting payment at the time services are rendered is a best practice. However, it may not be possible for the patient to pay in full at the time of the visit. Setting up a payment plan can be an option for large deductibles or self-pay patients. Clear communication with the patient and prompt billing will encourage prompt payments from the patient.
Keep your inventory is stocked and up-to-date.
When you think of working capital, adequate inventory might not be the first thing that comes to your mind. Keeping appropriate levels of supplies such as gloves, masks, syringes, sanitization products, and other office essentials can be a drain on working capital. Don’t forget about technology and equipment updates, these are high dollar investments that require maintenance and upgrades to provide optimum care and service to your patients.
If your working capital is stressed vendors may offer discounts and payment arrangements, especially if you are a long time customer, they want to keep your business and will most likely work with you to get the supplies your practice needs.
Work with a lender to get financing
Running a business is hard work, yes a medical practice is a business. Everyday causes, pandemics, supply shortage, seasonality, whatever the reason your working capital is stretched too far Hippo Lending has financing products to see you through this cash flow situation. Our loan advocates are here to help you understand options available to you and walk you through each step.
The Hippo Lending financing process is simple. Visit www.hippolending.com and provide some basic information, one of our Customer Service Advocates will reach out to you. Or visit www.hippolending.com and complete and application to start the process.
Four easy steps will make sure you get what you need:
- Hippo customizes your loan to fit your budget
- You share your information with us
- Your approval is ready within a few days
- You can access your funds in as little as one week
Once you complete the loan process, you can get back to what matters most: running your business and helping your patients. If you are ready to start the process, click here to fill out an application.
Hippo Lending represents the convergence of medicine and finance. While we may not be saving lives, the underlying principles of the Hippocratic Oath closely align with our values: a commitment to service and treating our customers as people, not just a loan. We ensure privacy and always act from a position of unity and humility. Your dreams inspire our work, we are champions for those, who at one time, may have felt like an underdog but today are dedicated to caring for others, we invest in people.