How to Finance the Purchase of Medical Equipment

Medical equipment finance is a topic that many health care facility managers do not deal with on a regular basis. However, purchasing new equipment for your health care facility can be expensive and many facilities do not have enough cash on hand to do so. When you need to buy equipment, financing the purchase might be your best option. Here are a few things to consider about medical equipment financing. 

Expansion

One thing to consider is your business expansion and how it relates to medical equipment. Many medical businesses are looking for a way to expand and bring in more revenue. Sometimes, the proper equipment purchase can help you out in this area. When considering a new piece of equipment, look at it in terms of business expansion. Ask yourself if this purchase will help you increase revenue in some way. If the revenue created by the purchase of the new equipment will pay for the purchase of the equipment over time, then you should most likely make the move. 

Expanding your business is essential to long-term success in the industry. You are either growing or dying in the business world and getting new equipment can help you grow.

Budget

When making the decision on new equipment, you need to consider your current budget. Look at your existing leases that you have on old equipment and determine when they are up. If you have some leases that are about to expire, it might be a good time to sign up for some new equipment. 

Look at your current revenue and determine if the cost of the new equipment will be able to be covered by how much you are making. If the cost will not be covered, it will take a leap of faith to purchase the new equipment. You have to believe that it will increase your business in the short-term. Looking at your budget and considering all of the possible factors will help you determine when the right time is to purchase new medical equipment.

Financing

There are many options to consider when looking to finance medical equipment. If you have a successful operating history of more than three years, there is a good chance that you can secure financing from a local bank. If you are a new business or cannot secure bank financing, you still have other options. 

One popular option is to use medical accounts receivable financing. This option involves a financing company paying you for your accounts receivables. Many medical facilities have hundreds of thousands of dollars in accounts receivables that are due to them from the insurance companies. If you have these accounts, the financing company will give you the money that is owed and then collect from the insurance companies when they pay. This allows you to get the cash you need for a reasonable interest rate. While these programs are still relatively unknown in the industry, you can benefit greatly from them if you know how to use them. 

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