ABL: The Healthcare Financing Trend Of 2017

February 16, 2017 by CNH Finance, LP in category “Financing”

Healthcare financing has always been a hot button topic in the United States. Now, with healthcare financing becoming front and center in almost every news report since the middle of January, private practices and large centers are trying to figure out how to maintain sources for working capital without without having to depend solely on payments from patients and insurance providers. Many practices have been turning to ABL as a viable solution.

What Is ABL?

ABL, or asset based lending, is a healthcare financing solution which provides a revolving line of credit to practices. This line of credit is structured around the value of assets, such as inventory, medical equipment, vehicles, owned property, and receivables. ABL works much like any over revolving line of credit, where medical practices can access capital as needed, rather than having to take the full amount at once. Additionally, as payments are made on the amount used, the line of credit is replenished.

ABL Is Healthcare Financing Without Debt

Unlike traditional bank loans, asset based lending provides healthcare financing without debt or compromised credit ratings. Instead, asset based lending actually gives medical practices the opportunity to increase their credit ratings. Much like any line of credit, by accessing ABL and paying off the balance in a timely manner, credit ratings for medical practices will increase quickly. This gives practices the ratings needed to access larger healthcare financing programs for plans such as expansions, acquisitions, and more.

Asset Based Lending Grows With Practices

Asset based lending is perhaps the only form of healthcare financing that grows along with practices. Traditional loans offer a finite amount of working capital, and once it is gone, the debt remains. With asset based lending, as a practice acquired new or specialized equipment, moves into larger facilities, or increases the volume of receivables, then the spending limit on the line of credit will also grow to reflect those positive changes. Asset based lending is designed to promote the success and growth of medical practices, rather than keeping them burdened with unnecessary debt.

Asset Based Lending For Medical Practices

Whether you own a private practice or you are making financial decisions for a large healthcare center, CNH Finance can help. We offer asset based lending to healthcare providers to ensure long-term success, even when the immediate outlook for the healthcare industry is uncertain. Contact our offices today to learn more about asset based lending, and how it can keep your business finances on steady ground.

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