These days, physicians do not just need to be health care experts: they must also be savvy practice managers — which is not as straightforward an undertaking as it may seem.
Indeed, physicians learn early on in their careers that cash flow management is not as simple as providing services, collecting payments, and paying bills. Everything from insurer reimbursement delays, to excessive paperwork, to employee errors add complexity and risk. This not only distracts from the core focus on providing quality care and meeting clinical standards, but it can make it financially difficult — or infeasible — to keep the practice operational.
What’s more, contrary to what many patients mistakenly believe, operating a medical practice is not a proverbial “cash cow,” and it is certainly not a turnkey franchise operation. Establishing and maintaining a medical practice requires significant overhead to cover leases, technology (EHRs, EMRs, telecommunications, etc.), insurance, and in many cases, renovations and upgrades. Indeed, combined with their medical school debt that typically starts in the 6-figures, many new physicians can take several years before they “climb out of the red.”
Fortunately, that is where physician loans enter the picture to make a transformative difference to physicians, staff, patients and communities alike.
What are Physician Loans?
Physician loans are funding solutions that are specifically designed for physicians, and take into consideration the unique dynamics and details that separate medical practices from conventional businesses.
For example, physician loans often have relatively lower interest rates and total cost of borrowing, given that demand for medical services is consistently strong. In addition, physician loans take into consideration that medical practices often have to wait months for insurance reimbursements due to the aforementioned excessive paperwork burden.
What Types of Physicians Loans are Available?
There are multiple types of physician loans available. The most popular include working capital loans, equipment financing, and business lines of credit. These can be used as a short-term or long-term business funding solution to cover a quick expense or an investment. Plus they range from under $100,000 to well over $1 million so your funding needs should be covered no matter how small or large they might be.
What Can Physician Loans be Used For?
Physician loans can be used for a variety of funding needs and goals, including (but not limited to):
- Hiring new staff, such as a practice administrator.
- Expanding an existing office, or acquiring another practice to create multiple locations.
- Purchasing new technology solutions, such as Electronic Health Record (EHR) systems.
- Consolidating debt in order to reduce total cost of borrowing.
- Covering costs related to disaster recovery (e.g. floor, fire, etc.).
At National Business Capital, we proudly offer a range of physician loans to help physicians across the country keep their practices strong and successful. To learn more, contact our team today for a complimentary consultation or fill out our two minute application to see what we can offer you!