Ongoing Nurse Staffing Payroll Funding Process

Most factoring firms can establish a new account in as little as three business days. But what happens after that? When nurse staffing agencies choose to work with a factor that understands their business model, the daily funding procedures are just as easy as the approval process.

The day-to-day nurse staffing payroll funding process works like this:

Staff Nurses & Send out Invoices
The beginning of the nurse staffing payroll funding process is not so different from your normal staffing procedures. You staff your nurses at a medical facility, collect your employees’ time sheets, and issue invoices to the facility. The only change at this stage of the process is the remittance address. Most nurse staffing payroll funding firms ask that their remittance information be printed directly on the invoice.

Send Information to the Funder
After you send your invoices and timesheets to your customer, those invoices are officially eligible for sale. So the next step is to send a copy of those invoices and their corresponding timesheets to your payroll funder. Typically, nurse staffing agencies send these items to a payroll funder via fax or email.

Click here to read more about the Ongoing Nursing Staffing Payroll Funding Process.

Retired Nurses Help Ease Staffing Crunch

We’ve been blogging for years about the nurse shortage and how medical staffing agencies have various opportunities to capitalize on the staffing crisis. There was an interesting article on Health Leaders Media’s website that profiled MidMichigan Health, a nonprofit system based in Midland, MI, that started bringing back retired nurses to cover gaps in shifts.

Here is an excerpt from the article:

The health system found it had a cadre of retired nurses who didn’t want to entirely stop working, so it utilized the available talent to fill gaps in schedules, work on special projects, and generally improve the staffing situation across the whole system.

“We had a lot of retirees that took a retirement package we offered as a cost saving measure,” says Tonia VanWieren, BSN, RN, director maternity unit/pediatrics, nursing office/shift administrator, MyTimeSelect/system staffing. “Then they wanted to come back to work because of the economy and different things in their lives.”

Click here to read the entire article: Retired Nurses Ease a Staffing Crunch, Bolster Budget

How Can Medical Staffing Payroll Factoring Help My Agency?

Do you have a profitable medical staffing agency that is sometimes short on cash? Or are you thinking of starting a medical staffing agency and worried that you won’t have enough money to make payroll? If you answered yes to either of these questions, then you are not alone. Every medical staffing agency owner goes through cash flow challenges. Some find ways to overcome their cash flow problems, and some do not. If you want to be one of the medical staffing business owners that succeed, then you should keep view this video:

One of the most frustrating aspects of owning a medical staffing business is that healthcare providers oftentimes insist on extending payments beyond 45 days. In fact, it’s not uncommon for a large medical facility to cut checks 60 days or later after services have been rendered. Naturally, a consistent history of ‘staff now and get paid later’ can wreak havoc for any new or growing medical staffing company. In effect, it causes the agency to be invoice rich and cash poor, which means that a medical staffing agency has a lot of outstanding receivables and little cash in the bank to show for it.

Fortunately, there is an easy way for staffing agency owners to turn their receivables into cash – medical staffing payroll factoring. It’s is one of the most used and least talked about ways to finance a business. In essence, medical staffing payroll factoring is a financing tool that allows medical staffing agency owners to convert their invoices into cash immediately. Specifically, a medical staffing payroll factor purchases an agency’s invoices at a discount and offers an advance payment to the agency. When the invoices come due, the medical staffing payroll factor collects directly from the agency’s clients (account debtors), takes its fees and releases the balance back to the agency. Utilizing medical staffing payroll factoring can transform an invoice rich agency into a cash rich…

Click here to keep reading How Can Medical Staffing Payroll Factoring Help My Agency?

Nurse Staffing – Time for a Change in Thinking

There was another interesting article from HealthLeaders Media that the nurse staffing factoring specialists at PRN Funding felt would be beneficial for our nurse staffing friends to read. Entitled Nurse Staffing Costs Must Be Weighed Against the Cost of Errors, the article author believes that hospital executives need to pay closer attention to studies that show how nurse staffing affects a hospital’s overall performance and base staffing decisions on those findings.

Kathy Douglas, MHA, RN, president of the Institute for Staffing Excellence and Innovation, CNO of API Healthcare, and a board member of the journal Nursing Economic$ was quoted in the article saying: “Staffing costs sit in one part of the budget, so we think of the results there. Then the cost of errors sits in another part of the budget. If I could say one thing to healthcare executives it is to make staffing a top strategic priority in your organization. If you look at top priorities-LOS, safety, quality-all of these things have direct links to staffing.”

Moreover, Douglas gave an example of looking at things from a bigger perspective. She said that some hospitals that have cut back on staffing may not notice that it is overusing overtime and it might not notice that there’s a relationship between the overtime and the number if infections on a unit.

Study Shows Temp ER Nurses Could Be a Safety Threat to Patients

The nurse staffing factoring specialists at PRN Funding came across a piece of research that we believe is important to share with our Nurse Staffing Industry readers.  Due to the perceived credibility of the source of the study it is imperative that any company that provides supplemental medical staffing be aware of the study and prepared to address the underlying issues.

Johns Hopkins University School of Medicine announced new research showing that temporary ER nurses may inadvertently be a threat to the patients they serve. Specifically, the study found that temporary nurses were twice as likely as permanent employed nurses to have medication errors in the hectic and fast-paced emergency room environment.

Although the studyimplicated temporary nurses, the authors stressed that temp ER nurses are not the only ones to blame for these shortcomings. The authors cited various reasons for ER errors, including the fact that many hospitals don’t give temporary nurses the same level of consideration and training as they do for their permanent staff.

Click here to read the official press release: Temporary ER Staff Poses Increased Safety Risk to Patients.

How Important is it for Nurse Staffing Agencies to Pay Payroll Taxes on Time?

From time to time, the nurse staffing invoice funding specialists at PRN Funding gets asked a question that we think our nurse staffing readers would appreciate hearing about. So today, our nurse staffing factoring staff are answering:

How Important is it for nurse staffing agencies to pay payroll taxes on time?

In short, VERY! Nurse staffing business owners may be able to dodge the bullet for a bit, but not paying your payroll taxes on time will catch up on business owners eventually. When the IRS discovers that a nurse staffing agency owner is behind, the punishment can cost the agency dearly.

The good news is that there are ways to catch up on back taxes. The best way for staffing agencies to stay in good-standing with the IRS is to respond to their calls and letters, and once a re-payment plan in is place, agency owners need to honor their commitments. Demonstrating a willingness to cooperate with the IRS helps nurse staffing agency owners avoid an IRS tax lien on his/her business.

It’s important to note that when a nurse staffing agency has a factoring relationship, the factor will be most likely want to see proof that payroll taxes are being paid. Nurse staffing invoice factoring companies will ask for this proof because the IRS is the only entity who can trump a factor’s lien.

Three Reasons Why Allied Health Staffing Agencies Should Factor Their Invoices

Although invoice factoring is a great alternative funding option for any type of business, it’s an especially good allied health agency financing choice for agencies that staff temporary professionals in hospitals, clinics and nursing homes. In fact, selling invoices to a factor allows allied health staffing agencies to get paid quicker without going into additional debt. Furthermore, agency owners who factor their invoices will have enough liquid capital on hand to make weekly payroll and keep up with payroll tax obligations. Still not convinced? Check out the Three Reasons Why Allied Health Staffing Agencies Should Factor Their Invoices:

Reason #1: Stop Waiting to be Paid.
Instead of waiting 30, 60 or even 90 days to receive payment staffing in allied health professionals at a medical facility, temporary staffing agency owners can sell their invoices to a factor and receive cash within 24 hours of issuing an invoice. All a factoring firm needs to advance cash is a copy of the invoice and proof that the employees worked the shifts listed on the invoice. This is easily accomplished by supplying copies of signed time sheets.

Reason #2: Leverage the Credit of Your Customers.
Allied health staffing  funding is a great option for companies who are either just getting started, have less-than-perfect credit or are going through a growth spurt. Rather than make a credit decision based off of the staffing agency’s credit or the business owner’s personal credit, allied health agency funding firms determine their credit limits after reviewing the payment trends of the agency’s customers. This is usually done by using a third-party credit bureau, and it’s done in a non-intrusive way, giving companies the ability to secure allied health agency financing based off of their customers’ credit rather than their own.

Click here to find out the last reason Why Allied Health Staffing Agencies Should Factor Their Invoices.

What to Tell Your Customers When You Are Working with a Nurse Staffing Factor

Hiring an invoice funding company can be an unnerving process for nurse staffing agency owners because they may be worried about how their customers will view the new financing relationship. It’s a natural concern to have; however, working with a nurse staffing account receivables factoring company doesn’t have to be scary. This article gives three unique responses that agency owners can give to their customers to help explain a new account receivables factoring arrangement.

Nurse Staffing Account Receivables Factoring Response #1:
Invoice factoring is just an alternative form of financing.
As a result of these difficult economic times, traditional lenders (i.e. banks) are not extending new credit lines, and/or they are increasing interest rates. This makes it extremely difficult for a temporary nurse staffing agency to obtain traditional financing. At the same time, the demand for temporary nurses has sky-rocketed.

Savvy staffing agency owners are turning to alternative sources of financing to ensure that their businesses have a positive cash flow. In short, working with a nurse staffing account receivables factoring firm proves that the agency is fiscally sound and prepared to weather the down economy. Moreover, the factoring arrangement will allow my agency to continue to grow without hindering our ability to provide quality nurses to your facility.

Nurse Staffing Account Receivables Factoring Response #2:
Our current nurse staffing relationship will go unchanged.
Even though a factoring company will be managing my staffing agency’s receivables, the business relationship that I have with your medical facility will not change.  We will continue to provide you with excellent nurses and invoice as usual. Should you need one of our supplemental nurses to fill a staffing gap, feel free to contact our agency directly, and we will find a nurse to fill the position.

The only thing that will change on your end is the remittance address, as payments should now be sent directly to the factoring company.

Click here to find out what the third nurse staffing factoring response is.


Healthcare Staffing Factoring – How Does it work?

There is a common misconception that healthcare staffing factoring is a complicated type of financing. In actuality, the factoring process is actually quite simple. All it takes is five easy steps…

Step One: Sell Healthcare Staffing Agency Invoices to a Factor

Technically, the first step in the healthcare staffing factoring equation happens when the agency’s customer (presumably a medical facility) has a shift open and requests the agency to fill that position. Once an agency employee works the shift, the agency is able to invoice the facility for the hours worked. At any time after the agency has invoiced the medical facility, it also has the ability to sell the invoice to a healthcare staffing factor.

The actual sale of the invoice is usually accomplished electronically, in that the agency emails or faxes a copy of the invoice along with corresponding signed timed sheets to the healthcare staffing factoring agency. The invoices and timesheets must be accompanied by an Assignment of Accounts Receivables form, which lists out all the invoices the agency wishes to sell to the factor and includes a signature from an authorized employee of the agency.

Step Two: New Debtor Credit Check

Once the healthcare staffing factoring firm receives the schedule of invoices and timesheets, an account manager reviews it for new customers. If there happens to be new customers (a.k.a. debtors), the account manager will conduct a brief credit review in order to establish a line of credit for that debtor. Typically, the credit review process can be completed within 24 hours of receipt. Once a new debtor has been approved for funding, the account manager will notify the debtor’s accounts payables department that when they receive invoices from the agency, the payment should be remitted directly to the factor.

If there are no new debtors included with the schedule, then the account manager simply moves on to step three of the healthcare staffing factoring process, which involves verifying the submitted invoices.

Want to find out the last three steps? Click here: How Does Healthcare Staffing Factoring Work?

How Groupon Makes Factoring Invoices Look Cheap

Tracy Z wrote an interesting post on FactoringInvestor.com comparing and contrasting the cost Groupon vs. the cost of invoice factoring.

Rightfully so, Tracy defined the marketing lure of Groupon as “marketing with no upfront fees.” For cash-strapped business owners looking to make more sales, free advertising sounds like a good deal–That is until you break down the numbers:

  • 50% discount to customer
  • 25% fee to deal provider
  • 25% net to business owner

In essence, the business owner only makes 25% AND they have to wait to get their portion, in installments, over time.Tracy outline a simple example, where 1/3 of the business owner’s profits was paid in 5 days, 1/3 in 30 days and the balance within 60 days:

$100,000

-$50,000 discount

-$25,000 fees

=$25,000 received by business owner (33% or $8,333 immediate advance, with the remaining $16,667 paid out over 60 days.)

Then Tracy used the same scenario as though the business owner were factoring:

$100,000

-$5000 factoring fee (average 5%)

=$95,000 received by business owner (80% advance or $ 80,000 upfront, with the balance less the fees received once debtor pays in full).

Pretty interesting comparison, huh?

Click here to read the article Tracy referenced in her post: Why Groupon is Poised for Collapse.

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