[Fundyman]

I know quite a few great factors who work with other industry types & are excellent at what they do.

For some strange reason, it appears I can't find a factor for medical receivables who won't charge $6,7,8000 upfront for some so-called costs!

The stupidest part about it is that after they collect the damn money, they find every reason in the book to decline the deal!!!

What's up with that? Has that been corrected in the industry yet? Does anyone know of a legit factoring company for medical receivables where there are no upfront costs, just like when working with other factoring companies that fund different industry types?

Please help~!

[CStewart]

Did you try Alleon?

[Kevin Henry-Seacoast]

I know quite a few great factors who work with other industry types & are excellent at what they do.

For some strange reason, it appears I can't find a factor for medical receivables who won't charge $6,7,8000 upfront for some so-called costs!

The stupidest part about it is that after they collect the damn money, they find every reason in the book to decline the deal!!!

What's up with that? Has that been corrected in the industry yet? Does anyone know of a legit factoring company for medical receivables where there are no upfront costs, just like when working with other factoring companies that fund different industry types?

Please help~!

Fundyman,

Medical receivables are tough to finance hence the reason we avoid the industry. Determining the dilution of the receivables is always the largest challenge. Most factors will charge some form of due diligence fees once a proposal is signed as there is cost for doing searches, legal, and documentation. $6K-8K seems excessive for facilities sub $5Mil unless they are requiring a field exam as part of the due diligence. A typical field exam can take a few days and most examiners are charging at least $1500/day plus expenses. This varies from firm to firm.

I cannot speak for the companies that fell down on your deals, as we don't know all the circumstances as to why. I can say that working with any financial institution that does a fair amount of heavy lifting before a proposal is issued always increases certainty to close a deal. Some complain about the amount of information that is asked upfront, but this makes for less surprises post proposal. I know that a very high percentage of proposals we close, we close on exactly what we proposed initially.

I am not sure who you have been working with i the past, but maybe reaching out to some members of the International Factoring Association might help.

Best,

kevin

[omegafund]

I know quite a few great factors who work with other industry types & are excellent at what they do.

For some strange reason, it appears I can't find a factor for medical receivables who won't charge $6,7,8000 upfront for some so-called costs!

The stupidest part about it is that after they collect the damn money, they find every reason in the book to decline the deal!!!

What's up with that? Has that been corrected in the industry yet? Does anyone know of a legit factoring company for medical receivables where there are no upfront costs, just like when working with other factoring companies that fund different industry types?

Please help~!

All the medical factoring we have funded the Factor does charge upfront fees, but 5-10k is not uncommon for $1M+ requests. Alleon is an option as mentioned above. If not email me and I have some others you can try

[Fundyman]

Did you try Alleon?

Check with Alleon what kind of fees they charge upfront.... That's the main reason I've asked this question. Alleon is the 1st med factoring company I've heard of, however, they wouldn't work unless they collected a few thousand upfront, which didn't work out after my client had just gotten burned for $7,000 by another random schmuck who claimed he did medical receivables factoring...

[Fundyman]

Fundyman,

Medical receivables are tough to finance hence the reason we avoid the industry. Determining the dilution of the receivables is always the largest challenge. Most factors will charge some form of due diligence fees once a proposal is signed as there is cost for doing searches, legal, and documentation. $6K-8K seems excessive for facilities sub $5Mil unless they are requiring a field exam as part of the due diligence. A typical field exam can take a few days and most examiners are charging at least $1500/day plus expenses. This varies from firm to firm.

I cannot speak for the companies that fell down on your deals, as we don't know all the circumstances as to why. I can say that working with any financial institution that does a fair amount of heavy lifting before a proposal is issued always increases certainty to close a deal. Some complain about the amount of information that is asked upfront, but this makes for less surprises post proposal. I know that a very high percentage of proposals we close, we close on exactly what we proposed initially.

I am not sure who you have been working with i the past, but maybe reaching out to some members of the International Factoring Association might help.

Best,

kevin

Kevin, I definitely appreciate that info as it warrants a factoring company charging upfront fees to do the work. However, this has a tremendous down side to it when dealing with a merchant who's been burned in the past but could use some factoring... I wonder what the alternatives are other than an MCA for them in that case...

[Kevin Henry-Seacoast]

Kevin, I definitely appreciate that info as it warrants a factoring company charging upfront fees to do the work. However, this has a tremendous down side to it when dealing with a merchant who's been burned in the past but could use some factoring... I wonder what the alternatives are other than an MCA for them in that case...

Why did they decline the deal?

[abfunders]

The number of UCC searches that they need to do is what justifies these up front fees. Working a deal now that took $2000 up front. So many UCCs are "CFG Corp as rep"......

[Kevin Henry-Seacoast]

Perhaps you should have a conversation with Lior at CFG who is a frequent visitor to DF. His firm has a factoring division......

[Fundyman]

Why did they decline the deal?

Deal wasn't declined. They started asking for an insane laundry list of docs, social security numbers of EACH patient, stuff that got the merchant's manager to stop & say: "Wait... You know this is private information, and each violation of sharing it is $12,000. Right?" upon which, the merchant got completely psyched out of moving any further!

Now, at that point, the so-called "factor" wouldn't return an ounce of the money back, though he said he would refund. He simply took the funds & left. Did he really need each patient's social in order to fact medical receivables? Do receivables have anything to do with socials or is it about the amount being billed?

There are file numbers, reference numbers, ways of not having to divulge people's socials on there! But what do I know...? That's not my area of expertise.

Thanks about CFG. I may look into working with those guys...

[Fundyman]

The number of UCC searches that they need to do is what justifies these up front fees. Working a deal now that took $2000 up front. So many UCCs are "CFG Corp as rep"......

Gotcha... Well, CFG may be the way to go, as $2,000 is not an insane amount to pay upfront. If anything, I can split that with the merchant to have them feel safer about the process.

[abfunders]

Fundyman, that was clearly a scam.
The medical receivable factor I'm working with now specifically states in his term sheets that he does not want any information that's a violation of HIPPA laws, and that the client will not send it.

[Kevin Henry-Seacoast]

Deal wasn't declined. They started asking for an insane laundry list of docs, social security numbers of EACH patient, stuff that got the merchant's manager to stop & say: "Wait... You know this is private information, and each violation of sharing it is $12,000. Right?" upon which, the merchant got completely psyched out of moving any further!

Now, at that point, the so-called "factor" wouldn't return an ounce of the money back, though he said he would refund. He simply took the funds & left. Did he really need each patient's social in order to fact medical receivables? Do receivables have anything to do with socials or is it about the amount being billed?

There are file numbers, reference numbers, ways of not having to divulge people's socials on there! But what do I know...? That's not my area of expertise.

Thanks about CFG. I may look into working with those guys...

Perhaps they needed to verify the patient's medicare/medicaid eligibility?

[Alleon Healthcare]

I understand the provider's concern. Unfortunately, our due diligence process is in depth and requires significant third party costs. Have you tried an SBA loan for this client?Those upfront fees are typically low.