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Providing your patients with the highest quality healthcare is the ultimate mission of each healthcare provider. This mission is in jeopardy with the estimated $15-$20 billion lost to bad debt each year, resulting in approximately 30% of U.S. hospitals suffering negative margins. The industry is also challenged by escalating expenses and the continued need for capital investment in management systems and high tech medical equipment. We understand the challenge to maintain your primary mission in the face of these factors.
At HFS, we believe that we have a way to address some of these challenges. Can you afford to ignore assets which have been written-off and are just taking up space on your agencies’ servers? An average 300 bed hospital may generate $10-$12 million of bad debt annually, with most of this generated from self-pay accounts. After agency recoveries you will have approximately $8.5 to $10 million warehoused at your agencies, generating minimal future collections.
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At HFS our mission is to liberate those assets and to generate incremental capital for you. We accomplish this by purchasing those warehoused accounts. This will create capital which can be used for necessary capital investments.
We will also enter into forward flow agreements which enable you to sell accounts which have been worked by your agencies for a specific period of time. This will generate ongoing cash flow from assets which would have once simply diminished in value. As a result, you may also experience an improvement in your primary recovery rates from your agencies.
The future risks and costs of collection, bankruptcy and deceaseds shift to HFS. However, we understand that these are your patients and so we provide you with the opportunity to recall these accounts for the price that was paid. While we don’t ever believe that will become necessary, we provide you with that peace of mind since we believe that working with HFS will become an integral part of your revenue cycle. |
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