Since 2010, there have been more than 100 closures of rural hospitals due to financial distress. Providers like these are vital to the health of communities that live too far to visit larger, more stable hospitals and practices.
But what can hospitals do when experiencing a financial crisis? Ideally, hospitals should use preventative measures before a financial crisis even occurs.
Want to know how medical lending can help prevent your hospital from experiencing financial distress? Keep reading.
What is Financial Distress?
Financial distress happens when a business or organization struggles to reimburse creditors, investors, and even employees. This leads to long periods of lost revenue, which has the potential to lead to bankruptcy and closure or consolidation.
In Texas, a study found that financial crises in healthcare rose from almost 14.5% to 16% from 2012 to 2015. The closing hospitals had three things in common:
These predictors of financial distress can be mitigated by growth and diversification of services offered. But prevention is the #1 way to stop a financial crisis before it affects your hospital.
Medical Lending Prevents Financial Distress
Improving debt collection not only helps to improve small margins but it also leads to growth.
When your hospital decreases accounts receivable days and overall bad debt, you have more money to pay employees and investors. Your staff spends less time playing debt collector and more time looking for new ways to diversify your services portfolio.
Medical lending programs for patients can help you do all of that and more.
We at Epic River designed our patient financing program to help your hospital collect patient debts so you can prevent a financial crisis. All patients are approved for loans and you’re paid upfront and in full for services rendered. If your hospital is looking for a better way to help patients pay, contact us today to find out how we can lend you a hand.