Home Health Merchant Cash Advance & Business Funding
Merchant cash advance for home health agencies.
Home health agencies can get a merchant cash advance to cover caregiver payroll while waiting on Medicare, Medicaid and insurer payments. The gap between paying caregivers and getting paid is the core issue. A new agency still getting certified faces a longer wait. Funders read payer mix and how long claims take.
How do funders read home health agencies?
Funders look at payer mix, claim timing and whether the agency is fully certified with each payer.
How does money come in for home health agencies?
Revenue comes as Medicare and Medicaid payments by EFT, managed care payments, and some private pay. Caregivers are paid weekly or every two weeks. Claim delays and state payment schedules drive the gaps.
Which months are slowest for home health agencies?
This table shows how many people private home health care services (NAICS 621610) businesses employed each month, as an index where the year's average is 100. It comes from the Bureau of Labor Statistics Quarterly Census of Employment and Wages, the most recent full year available. Staffing is a stand-in for how busy a business is. Deposits can move more or less than headcount, so read it as the shape of the year, not your numbers.
| Month | Staffing index (average = 100) | |
|---|---|---|
| January | 101 | |
| February | 101 | |
| March | 102 | |
| April | 98 | lowest |
| May | 98 | |
| June | 98 | |
| July | 99 | |
| August | 99 | |
| September | 100 | |
| October | 101 | |
| November | 102 | |
| December | 102 | highest |
The low point is April at 97.8 and the high point is December at 102, a swing of 4.2 points. Staffing dips in spring and climbs into winter.
| Quarter | Total payroll index (average = 100) |
|---|---|
| Quarter 1 | 100 |
| Quarter 2 | 97 |
| Quarter 3 | 99 |
| Quarter 4 | 104 |
Payroll by quarter can rise at year end for reasons like bonuses and overtime, not only more work.
What do home health agencies use merchant cash advances for?
- Caregiver payroll while claims are being paid.
- Electronic visit verification and scheduling systems.
- Hiring and training.
- Opening a new service area.
- Insurance and licensing.
What does an advance payment look like in a slow month?
Staffing barely moves through the year here, so the slow month to plan for isn't seasonal. Say a state payment cycle slips and deposits come in 20% under average for a month. Say a business like yours deposits $250,000 in an average month and carries a fixed payment of $25,000 a month, 10% of that average:
| Deposits | Fixed payment | Share of deposits | |
|---|---|---|---|
| Average month | $250,000 | $25,000 | 10.0% |
| A month 20% below average | $200,000 | $25,000 | 12.5% |
A fifth less in deposits turns a 10% payment into 12.5%. Keep a cushion for it, or ask how reconciliation works before you need it.
Which funding options fit home health agencies?
Each page runs one option against this industry's slow months.
Same-day merchant cash advance for home health agencies
Money the same business day for an urgent cost, with the fixed daily debit measured against a slow month.
Business line of credit for home health agencies
A draw sized for a slow month, repaid in thirds, with the interest on the balance worked out.
MCA consolidation for home health agencies
One payment in place of two, with the share of deposits before and after in a slow month.
Second position MCA for home health agencies
What a second advance adds on top of the first, and what both payments take from deposits in a slow month.
Revenue-based financing for home health agencies
A remittance that moves with revenue, so a slow month sends less, and the months to reach the repayment cap.
Run a business like this?
Tell us your slow months up front and we'll look for funders that size for them. Call 877-FUND-654 with any question. We call you back, usually the same business day, and we always talk with you before we shop your file.