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How to Secure Working Capital for Your Medical Practice

How to Secure Working Capital for Your Medical Practice

Securing capital for a medical practice is a complex challenge. A President and a Chief Financial Officer have navigated it using strategies from bank loans to specialized equipment financing. Alongside their insights, we’ve collected additional answers covering a range of innovative financing options, including government-backed healthcare programs. These diverse strategies have fueled growth and ensured the stability of medical practices, from leveraging medical receivables to engaging physician-specific financial services.

  • Explore Bank Loans and Crowdfunding
  • Combine SBA Loan and Equipment Financing
  • Apply for Health-Related Grants
  • Leverage Medical Receivables Financing
  • Partner with Healthcare Industry Investors
  • Engage Physician-Specific Financial Services
  • Utilize Government-Backed Healthcare Programs

Explore Bank Loans and Crowdfunding

As a medical practice owner, securing capital is crucial for the growth and stability of your business. There are various financing options and strategies available to help you fund your practice’s operations and expansion plans.

A popular choice is to apply for a business loan from a bank or financial institution. This allows you to borrow a lump-sum amount with a fixed interest rate that can be paid back over time. However, keep in mind that taking on debt can also bring about financial risks if not managed properly.

You may also consider utilizing crowdfunding platforms to raise capital for your medical practice. This involves reaching out to a large number of individuals and offering them the opportunity to invest in your business in exchange for rewards or equity.

Evan TunisEvan Tunis
President, Florida Healthcare Insurance


Combine SBA Loan and Equipment Financing

To secure capital for our medical practice, we opted for a combination of an SBA 7(a) loan and equipment financing. The SBA loan provided us with favorable terms and lower interest rates, which were essential for covering initial startup costs like leasing space and initial staffing. Equipment financing allowed us to acquire state-of-the-art medical equipment without a massive upfront expense, spreading the cost over manageable monthly payments. These financing choices enabled us to start with a strong foundation, attract top talent, and offer high-quality services from day one. As a result, our practice experienced steady growth and built a reputation for reliability and excellence in patient care.

Brian ChasinBrian Chasin
Chief Financial Officer, SOBA New Jersey


Apply for Health-Related Grants

When seeking funds for a healthcare practice, one effective strategy is to explore grants designated for medical initiatives. These grants are often provided by government entities, foundations, and private organizations looking to support health-related services. They may cover a range of needs, from purchasing cutting-edge equipment to implementing community health programs.

Since these grants typically do not require repayment, they can be a substantial boon to establishing or expanding a practice. Finding and applying for these grants may take time and effort, but the potential benefits are significant. Investigate what grants might align with the goals of your practice today and take the first step towards securing your financial future.


Leverage Medical Receivables Financing

Physicians seeking to secure capital for their medical practices can consider leveraging medical receivables as a finance option. This entails using the expected payments from patient care, often in the form of insurance reimbursements, as collateral for a loan. It’s a viable way to obtain immediate capital for improving or expanding your operations, without the need to take on a traditional loan.

Financial institutions that offer this kind of financing understand the unique cash flow challenges of medical practices. If you have a consistent stream of receivables, explore this financing route with a trusted lender to smooth out the financial ups and downs of running your practice.


Partner with Healthcare Industry Investors

Forging partnerships with investors specializing in the healthcare industry can be instrumental for physicians looking to fund their medical practices. These investors typically bring more than just financial support; they can offer valuable industry connections, business acumen, and strategic planning assistance. Aligning with healthcare investors can mean tapping into a wealth of experience in dealing with the specific challenges and opportunities in the medical field.

Moreover, investors can provide capital for growth, new technology acquisition, or facility improvement, which can ultimately lead to better patient care. For those seeking to enhance their practice’s financial health, consider starting conversations with healthcare investors.


Engage Physician-Specific Financial Services

Physicians can utilize specialized financial planning services that cater exclusively to the healthcare sector to secure funding for their practices. Such services understand the unique economic patterns, obligations, and opportunities of medical professionals and can offer tailored financial strategies. These experts can help in budgeting, identifying the right type of loans, and creating sustainable financial plans for both new and established practices.

This dedication to meeting the particular needs of physicians can prove invaluable in navigating the complexities of medical practice financing. Engage with a physician-specific financial planner to build a robust financial foundation for your practice.


Utilize Government-Backed Healthcare Programs

Investigating government-backed programs that support healthcare facilities can be a sound approach for medical practices looking for financial backing. These programs are typically designed to promote public health and may offer favorable terms such as lower interest rates or more flexible repayment options than conventional loans. By taking advantage of such programs, practices can access the capital needed for facility upgrades, state-of-the-art equipment, or expanding patient care services.

While the application process may be rigorous, the long-term benefits to both the practice and its patients can be substantial. Look into these government programs to see how they can help in strengthening your practice financially.


Submit Your Answer

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