Medical practices · working capitalNovember 2026 edition info@halstedmedicalcapital.com
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Working capital for medical practices

The claim is clean. The payer takes 45 days. We fund the visit now.

Insurance receivables, credentialing delays, a new associate's ramp and equipment that costs more than a year of rent — practice cash flow is predictable and slow. We size funding to the receivables already on the books.

Size a request to the practice Situations we fund
  • Sized to receivables and payer mix
  • Decisions in 24–48 hours from statements
  • Every cost in dollars before signing
Line drawing for medical practices: an exam chair and stool, the supply cabinet, a stack of claims and the 45-day calendar
The medical cash cycle

Where the money is, and when it isn't.

  1. Day 0

    Visit

    The service is delivered; the claim is coded and submitted within days.

  2. Day 14–45

    Adjudication

    Commercial payers remit in 30–45 days, Medicare ~14, Medicaid longer; denials restart the clock.

  3. Day 60–90

    Patient balance

    Co-pays at the desk; the rest billed after the EOB, collected over 60–90 days.

  4. 60–120 days

    Credentialing

    A new provider bills nothing for 60–120 days while payers credential them.

  5. Once a decade

    Equipment

    A CBCT, an ultrasound or a dental chair is $40,000–$250,000 and lasts a decade.

Situations we fund

What practice owners come to us for.

Each one is sized to the location and the remittance schedule. The cases go into the numbers; the rest lead straight to a request.

How it works for medical

From the gap to funded, in four steps.

  1. 3 minutes

    Tell us the practice and the gap

    Specialty, collections, what is coming. Three minutes, no credit pull.

  2. Same day

    Send statements and the aging report

    Bank statements show deposits; the A/R aging shows the receivable the funding sits against.

  3. 24–48 hours

    Compare advance, practice line and equipment financing in dollars

    Amount, total payback, remittance, APR-equivalent beside any factor rate.

  4. A business day after signing

    Fund and remit as the payers do

    Funding usually within a business day of signing; weekly remittance sized to collections.

Worked examples

The numbers, in medical units.

Worked example 1

Funding a new associate through credentialing

A two-dentist practice adds an associate at $14,000 a month. Payers take 90 days to credential; the associate's production ramps to $55,000 a month by month four, collected at 62% net of adjustments.

The gap
Associate cost during credentialing (3 months)$42,000
Added overhead (assistant, supplies)$15,000
Collections from the associate, months 1–3$0
Gap to cover$57,000
The funding
Advance$60,000
Factor rate1.21 (≈ 40–45% APR-equivalent over 6 months)
Total payback$72,600
Remittance$2,780 per week, 26 weeks
Cost of the bridge$12,600

The bridge, day by day

  1. Month 0

    The associate starts

    $14,000 a month in salary

  2. Day 5

    Funded

    $60,000 advance lands

  3. Months 1–3

    Credentialing

    Producing, but billing nothing yet

  4. Month 4

    Claims flow

    Production ramps to $55,000 a month

  5. Month 6

    Remittance complete

    $72,600 delivered over 26 weeks

What it costs, in dollars Illustrative · not an offer
OptionAmountFactor rateTotal paybackCostAPR-equivalentTerm
Advance sized to the gap$2,780 per week, 26 weeks$60,0001.21$72,600$12,600≈ 42%6 months
Bank practice line of creditAbout a third of the cost; six weeks to open$60,000——≈ $4,200≈ 14% APR6 months

APR-equivalent is calculated as cost ÷ amount ÷ months × 12, which allows a factor rate to be compared with a loan's APR. Actual terms depend on deposits, time in business and open positions, and each option is quoted as total payback in dollars.

What the numbers say. By month six the associate collects about $34,000 a month against a $14,000 salary. A practice line of credit at a bank would cost a third as much and take six weeks; if the practice has one, use it. If not, this is the bridge.

What a partner looks at

What a file from a medical business needs to show.

Within medical

  • Dental
  • Primary care & urgent care
  • Veterinary
  • Physical therapy & chiropractic
  • Dermatology & aesthetics
  • Behavioral health

The four products, in one line each

Merchant cash advance

The purchase of a fixed amount of future receivables, remitted daily or weekly. It is fast, sized to the practice's payer remittances, and should be fully understood before it is accepted.

Funding in 1–3 days
Revenue-based financing

Remitted as a percentage of revenue, so slower weeks remit less. It suits practices with seasonal volume or uneven receivables.

Up to 12–18 months
Equipment financing

Secured by the equipment itself, which generally means lower cost and longer terms than unsecured capital.

Terms of 2–7 years
Business line of credit

Available to draw as needs arise, with cost tied to what is used. Best suited to a recurring shortfall rather than a single expense.

Revolving
Published minimums

A medical file that funds

Time in business
6+ months; established practices qualify for more
Monthly collections
$30,000+ on average
Payer mix
Commercial and Medicare receivables strengthen the file
Existing positions
Practice loans and equipment notes are fine; open advances are reviewed
Credit
550+ FICO considered; collections weigh more

If the practice falls just short, please ask. Collections and receivables on the books carry more weight than any single criterion.

Check your fit
Glossary

The trade's words, and what they mean for funding.

Adjudication
The payer's review of a claim before paying, denying or adjusting it.
EOB / ERA
The explanation of benefits (paper) or electronic remittance advice that tells the practice what was paid and why.
Credentialing
A payer's approval of a provider to bill under its contract; 60–120 days during which the provider bills nothing.
Collections ratio
What is collected as a share of what is billed, net of contractual adjustments.
Questions practice owners ask

Plain answers before you talk to anyone.

Can funding be sized to my insurance receivables?

Yes. The aging report and payer mix show a partner what is coming and when. Clean claims under 60 days are the strongest collateral a practice has, and they are not pledged the way equipment is.

Does an advance affect my practice loan covenants?

It can — many practice loans limit additional debt. Read the covenant before signing anything; we will tell you when a file conflicts with one.

Should I lease or finance equipment?

Finance when you will keep it past the term (most dental and imaging equipment); lease when the technology turns over in three years. Either is cheaper than an advance for equipment.

Send us the practice's numbers. We'll show you the cost.

Begin with the amount and the date it is needed. There is no obligation and no credit pull to start.

Size a request