Nurse Staffing Account Receivable Factoring – How to Get Started

Factoring firms receive all sorts of questions from business owners in regards to their services. From the cost of factoring to the length of time one is required to remain in a factoring relationship, we’ve heard it all. However in this article, I’d like to answer one of the most frequently asked questions about nurse staffing account receivable factoring: What is needed to complete an initial factoring transaction?

  1. The first thing a nurse staffing account receivable factor does prior to an initial funding is check into the creditworthiness of the agency’s customers. Credit approval for a first-time debtor (customer) is simple. The agency supplies the factor with the name and address of the new debtor, and then the factor will run credit on that debtor. Once approved, the agency can present invoices for sale.
  2. The business owner sends out the original invoices to their debtors as normal, and then sends a copy of those invoices along with proof of performance (signed time sheets) to the factoring company. This can usually be accomplished via fax or email. It’s important to note that the nurse staffing account receivable factoring company will only purchase invoices for shifts that have already been worked.
  3. The account receivable factor will then verify that the invoices are valid by speaking with a nurse scheduler or Director of Nursing (DON) at the facilities where the shifts were worked just to confirm that the nurses worked the shifts listed on the invoices.

Click here to read about the rest of the Steps to Complete an Initial Nurse Staffing Account Receivable Factoring Transaction.

New Web Site and More for National Nurses in Business Association

The National Nurses in Business Association (NNBA) sent out an eNewsletter this week full of some exciting announcements:

First the nurse entrepreneur organization launched a new website in late January. The new site is easy to navigate, has a print option for each page, and has a quick find feature. Photos of NNBA members are also a part of the website. Click here to check out the new NNBA web site.

In addition, the NNBA launched a monthly newsletter this year, which will highlight members and their accomplishments, and report nurse entrepreneur news and upcoming events.

Finally, the NNBA and the University of Florida are collaborating for the 27th Annual NNBA Conference: Healthcare Self-Employed Entrepreneurship Summit. The event is scheduled for August 18 and 19, 2012, in Orlando, Florida. Click here for more information on the 2012 NNBA Conference.

The Truth about Allied Health Staffing Invoice Funding

Invoice funding is a great financing tool for allied health staffing agencies because it bridges the gap between when agency owners invoice a medical facility and when that facility pays. Unfortunately, some allied health staffing business owners are still hesitant to take advantage of all that invoice funding has to offer because of all the misinformation circulating out there. Allow me to debunk some of those myths about allied health staffing invoice funding.

Myth #1: Allied Health Staffing Invoice Funding is an Expensive Financing Option

Truth: First and foremost, an invoice funding fee (i.e. a factoring fee) is not the same thing as an annualized interest rate. For example, an allied health staffing invoice financing company may charge 3% per month, but that’s not the same thing as 36% APR. Rather, an invoice funding firm’s fees stop the day an invoice is paid. Furthermore, allied health staffing agencies can’t and won’t wait 12 months to receive payment for their staffing services. Most agencies agree to payment terms somewhere between 30 and 45 days. So in reality, allied health staffing invoice funding is not costly.

Myth #2: Allied Health Staffing Funding Companies Require a Long-Term Commitment

Truth: Unlike a traditional line of credit through a bank loan, most allied health invoice factoring companies do not require a long-term commitment. In fact, some invoice funding companies only ask for a six month commitment, while others do not require a fixed-term at all.

Click here to read the entire article: The Truth About Allied Health Staffing Invoice Funding.

How Home Healthcare Agencies Can Qualify for Invoice Funding

Gone are the days when a home health care’s agency’s only financing option is a line of credit from a bank. In fact, there are dozens of ways a home health care agency can fund its growing operations. However, one specific option business owners should consider is home health care invoice funding.

In a nutshell, home health care invoice financing is the process whereby an agency sells its accounts receivables to a third party (factoring firm) at a discount. Rather than waiting weeks or months to receive payment from Medicaid, Medicare or other governmental agencies, factoring firms advance cash immediately upon purchasing home health care invoices, which gives business owners the ability to maintain a positive cash flow.

All it takes is three simple steps to set up a home healthcare invoice funding account…

  1. Contact a Home Health Care Invoice Funding Company
    There are thousands of factoring firms to choose from. The trick is to find one that understands the intricacies of the home health care industry. Luckily, a simple Google search for “home health care invoice funding,” can quickly narrow down the playing field. Once you select an invoice funding firm to work with, you can usually complete an online application or call and speak with a home health care funding account representative to have him / her email and / or mail out a complete document package.

Click here to find out the remaining steps on how to qualify for home health care invoice funding.

Bank Lending to Businesses is Up, but For How Long?

Yesterday, the Fiscal Times reported that bank profits are currently the highest they’ve been in six years. The healthcare factoring experts at The Factoring Blog included some of the article’s highlights below:

Bank loan balances rose $130.1 billion, or 1.8 percent, in the 2011 fourth quarter compared to third quarter, according to a quarterly report by the FDIC released on Tuesday.

Furthermore, credit to businesses, up $62.8 billion, or 4.9 percent, led the increase in lending totals.

While much of that went to large and medium-sized businesses, the FDIC said that for the first time in the seven quarters that the figures have been tracked, lending to small businesses, defined as loans of $1 million or less, went up. Such lending increased $2.8 billion, or 1 percent.The FDIC quarterly report showed the industry earned $26.3 billion in the fourth quarter, up $4.9 billion, or 23.1 percent, from a year earlier. However, the increase was largely due to banks setting aside less money to guard against loan losses.

The amount set aside for loan losses in the fourth quarter was $19.5 billion, down 40.1 percent from a year earlier.

Officials have warned that this trend cannot continue much longer.

Click here to read the entire article: Bank Profits Highest Since 2006.

2012 Small Business Outlook

Small Business Trends posted the results of recent survey of 5,000 small business owners conducted by The Shafran Moltz Group’s.

Watch the video summary below:

Overall, the 2012 outlook for small business owners remains uncertain. Here are some of the survey’s highlights:

  1. 45% of respondents thought the economy was finally steady and do not believe there will be a double dip recession.
  2. Over 1/3 of the respondents thought that the economy was basically stuck in neutral or GDP could even decrease this year.
  3. 69% of small business owners thought they would see health insurance premiums increases from 5% to 20%, and a quarter of the respondents predicted premium increases of 20% or higher.
  4. 68% of the small business owners think that banks will stay missing in action for lending capital in 2012.
  5. The most common concerns small businesses mentioned for the coming year were how the continued uncertainty in the economy and gridlock in Washington affects their own inability to make decisions. Added fears were how the euro crisis and lagging home prices will hurt the overall economy in the long run.

Click here to read more about the 2012 Small Business Outlook according to The Shafran Moltz Group.

AHDI is Now Accepting 2012 Integrity Awards Nominations

In support of AHDI’s professional programs, standards, and best practices, the Association for Healthcare Documentation Integrity conducts an annual awards program to acknowledge the significant contributions of its members and other individuals and organizations that have made an impact on the healthcare documentation sector and medical transcription industry over the previous year.

The following award categories address the areas of contribution that best align with AHDI’s strategic plan, goals, and objectives as an organization.

Member of the Year
Employer of the Year
Educator of the Year
Rising Star Award (Student Essay)
Excellence in Credentialing
Membership Impact
Innovation through Technology
Advocate of the Year

Nominate an individual or company today! Nomination deadline is April 30, 2012. Visit the Integrity Awards web page for complete details and specific nomination forms.

Factoring Brokers: Managing Cash Flow in Times of Uncertainty

From the housing market crisis to the infamous bank bail outs to the most recent elections, a lot has happened recently that will have lasting effects on the cash flow industry in a multitude of ways.

The lending crisis is having a tremendous effect on small business owners, as banks and credit card companies raise borrowing costs and slashed credit lines. At the same time that the banks stopped lending, many small business owners saw their account receivables slowing down, which led to a cash flow bottleneck.

Check out our YouTube video for more information:

While we would like to know what lies ahead for the cash flow industry, no one knows for sure what the future holds. However, one thing will go unchanged during these times of uncertainty-the need for business owners to proactively manage their cash flow will never go away.

As factoring brokers, your services will be in high-demand over the next year as the fate of economy remains unsettled. Not only will you need to continue to locate non-traditional lenders (i.e. factoring firms) for your clients, but you will also be called upon to give a factoring broker plan to help business owners navigate through these turbulent times.

Click here to read some suggestions for factoring brokers to keep in mind as small business owners navigate these times of cash flow uncertainty.

How Factoring Brokers Can Close More Deals

Typically, the invoice factoring sales process happens in three parts: (1) Explanation of what is factoring by the broker to the business owner, (2) The conceptual embrace of factoring by the business owner, and (3) The closing, (a.k.a. the business owner agrees to factor his/her receivables). All too often, the process stalls in the closing phase of a factoring deal. The last thing a factoring broker wants to have happen is to see his/her hard work throughout the sales cycle come to a standstill. The following “Five Tips for Closing More Factoring Deals” are designed to help factoring brokers become more effective with the closing piece of the factoring sales process.

Sell the Business Owner What They Want, Not What They Need
A cardinal rule that many salespeople forget to follow during the closing process is a basic one: listen to what the business owner wants. Without a doubt, when a business owner approaches a factoring broker, he/she needs to improve his/her cash flow, but what they really want is cash. Make sure that your closing technique narrows in on the fact that invoice factoring will indeed fulfill their want – to have cash. Which sounds better to you? Saying something like “Factoring your invoices will help improve your cash flow;” or saying something like: “When you can sell your invoices to a factoring firm, you can literally receive cash the same day you invoice.”

Sell Invoice Factoring as a One-of-a-Kind Financing Solution
In the sales world, the word “only” is probably one of the most influential selling agents when it comes to closing a sale. As luck would have it, most business owners have never heard of the concept of factoring. In addition, these same business owners often approach a factoring broker when other traditional financing methods have failed them. This built-in scenario gives factoring brokers the ability to offer a very appealing and tailored one-of-a-kind solution to get a business owner cash fast-invoice factoring. Who could turn down that kind of offer?

Click here for Additional Tips for Closing More Factoring Deals.

The Perfect Invoice Factoring Deal

Rather than elaborate on one specific deal that worked out for the better, this article will expand on three surefire attributes all involved parties (brokers, factors and prospects) need to have in order for a factoring relationship to run smoothly from beginning to end. All it takes is a little preparation, good communication and some organization.

Preparation

Brokers:
Before a factoring broker even thinks about referring a prospect to a funding source, it’s important for him/her to do some behind-the-scenes prep work ahead of time. Examples of this prep-work include:

  • Knowing all of the pertinent details about each of your funding sources(i.e. Monthly minimums/maximums, industries they serve, general fee structures, length of time it takes to close a deal, how they prefer to receive referrals, etc.)
  • Educating yourself as much as you can about the prospect’s company and/or industry (i.e. Do they provide services or products?, Who are their customers? How much do they bill?, Why do they want to factor? How long have they been in business? Do they have any liens?, etc).
  • Gathering pertinent information from the prospect to help the factor qualify the lead appropriately (i.e. Current invoice aging report, Articles of Incorporation or Articles of Organization, Contact information for company principles, etc.)

Factors:
Factoring firms also need to be adequately prepared to receive a lead from a broker. This can easily be accomplished by having a structured referral program already in place so brokers know upfront what the factor expects from them. In addition, factoring firms should have dedicated personnel available to help brokers through the process of submitting a prospect.

Prospects:
The best prospects to work with are those who are prepared to answer questions pertaining to their business and who have pertinent business documents on-hand and ready to distribute to the broker and/or factor. For example, most companies should be able to easily access their most recent tax returns, provide financing reports (i.e. invoice aging, profit/loss statement, balance statement, etc.), and supply copies of company registrations.

Click here to keep reading More Tips On Finding the Perfect Invoice Factoring Deal.

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