Healthcare providers are feeling the impact of consumer driven healthcare in many ways. With increasing levels of uninsured and underinsured patients, one impact is the higher number of unpaid bills. It is estimated that hospitals write off approximately $30 billion annually to cover bad debt. Such financial losses can limit a hospital's ability to utilize its capital efficiently.
As a means to increase cash and improve their revenue cycle, many hospital administrators and CFO's have taken advantage of a new tool – selling receivables to third-party asset buyers and servicers.