How does Medicare receivable factoring work for home health agencies?
You submit your Medicare cost report or claim batch to the factoring company after services are delivered. The factor advances 80–90% of the claimed amount within 24 hours. When Medicare pays (30–90 days later), the factor remits the remaining balance minus their fee (typically 1.5–4% of the advance, depending on payer type and collection timeline). This eliminates the reimbursement timing gap without taking on traditional debt.
Can a home health agency factor Medicaid receivables?
Yes. Medicaid receivables are factorable, though some states and payer types have assignment restrictions. Most factoring companies that specialize in healthcare have experience navigating Medicaid-specific assignment requirements and state billing rules.
What impact do the 2026 Medicare cuts have on my ability to get funded?
The 2026 1.3% rate decrease reduces revenue per episode, which affects deposit averages over time. Lenders look at 3–6 month deposit trends. Agencies maintaining strong visit volumes despite rate cuts can still qualify for strong funding — the key is consistent deposits, not necessarily rate growth.
Can my home health agency get funded to expand into a new county or state?
Yes. New service area expansion, including state licensure costs, caregiver recruitment for the new area, and the working capital to operate while building the new area's census, are eligible uses of term loans and working capital for established agencies.
How does HR1 (proposed Medicaid cuts) affect home health agency funding?
The proposed $1 trillion reduction in Medicaid spending over 10 years would have significant long-term implications for agencies heavily reliant on Medicaid. In the near term, lenders monitor this risk but continue to fund agencies with strong census, diversified payer mix, and consistent deposits. Agencies with 40%+ private pay or commercial insurance payer mix face less exposure.
Can I get working capital if my agency has outstanding Medicare repayment obligations?
Active overpayment demands or Outstanding Medicare repayment plans may affect qualification. Lenders typically require that Medicare is actively processing claims without a billing suspension. An active repayment plan with CMS that is being honored does not automatically disqualify a business.
What credit score do I need to get funded as a home health agency business?
Programs start at 500 FICO. Scores of 620+ access the most competitive rates. Strong average monthly deposits can offset lower credit scores for smaller advance amounts.
How fast can a home health agency business get funded?
Qualified businesses typically receive same-day to 72-hour ACH deposits for working capital. Equipment financing closes in 2–7 business days with a vendor quote.
Can a home health agency business with existing loans get additional funding?
Often yes. We evaluate net cash flow after existing debt service. Existing positions are a factor but not an automatic disqualifier for businesses with strong revenue.
Do you require collateral for working capital?
No. Our working capital programs are unsecured — we do not require real estate, equipment, or personal asset pledges. A personal guarantee is standard for most programs.
Can a startup or newer business get funded?
Businesses under 6 months old have limited options. At 6+ months with consistent deposits, most programs are accessible. Equipment financing is available from day one with a down payment.