Comprehensive Electronic Medical Advance FAQs
Once again, what is CEMA?
CEMA stands for Comprehensive Electronic Medical Advance. CEMA is a financing product available only to the healthcare industry, extending beyond medical/dental/chiropractic entities and including assisted living centers and medical supply, as examples. CEMA was envisioned to meet the current financial needs of professionals in these related fields that traditional lending sources have neglected and/or have not adapted to. With CEMA, health professionals are able to leverage all of their electronic receivables to obtain financing. They are thus freeing themselves from the rigors of collateralizing specific invoices, which are also usually backed by personal, joint or severable guarantees.
How does CEMA work?
Instead of providing financing for specific invoices that first must be approved, with uncertain rates and funding amounts, CEMA provides an upfront and set amount of bulk cash with a defined cost.
What types of invoices/payments does CEMA consider?
CEMA considers all forms of payments that are received electronically: credit and debit cards, ACH, as well as imaged checks.
What if an invoice ages from 90 days to 120 days?
No problem. Your collection period has no impact on the amount of money you receive or the cost of funds for the money you receive. CEMA does not penalize you for late pays.
What determines the amount of money that I am eligible to receive with CEMA?
Your funding amount is determined by average, historical electronic receivable volumes that have been deposited into your bank account. Essentially, your monthly electronic deposits determine the disbursement that you can receive under the NorthPoint’s CEMA program.
What exactly is considered when determining how much I am eligible to receive?
Any and all payments that are received electronically. This includes payments from insurance carriers, imaged checks, ACH, Back Door Conversions, and all credit card payments.
Do I have to pledge specific invoices?
No. CEMA operates independently from your individual billings.
What if I have Medicare claims that are over 180 days old?
With CEMA, it does not matter. If an invoice is 3 days or 300 days old, it makes no difference in the amount of cash that you can receive or the cost of the funds.
Do the doctors and/or practice have to pledge or guarantee anything?
No. There is no personal, joint, or severable guarantee required.
How are payments made to CEMA?
A percentage of all electronic payments are retrieved until the agreed dollar amount is collected.
Is CEMA a loan or an Invoice Factor?
No. With CEMA, you are essentially selling a portion of your future receivables and payments at a discount. There is no fixed payment, no fixed term, no variable cost of funds tied to collection schedules, no penalties for invoices/ claims that pay late.
What if my practice does not accept insurance or all of my clients are here for elective surgery/procedures? Can I still qualify for the CEMA program?
Not a problem. If you receive credit card payments, process checks electronically, or receive payments from clients via an ACH service, you can still qualify for the CEMA program.
How long does it take to receive funding after I have been approved?
In most cases, after you have been approved, funding can be wired into your account within 5 to 10 business days.
What do most practices typically use the money for?
The same purposes as with Medical Accounts Receivable funding. They pay for O.R. time, training, specialized equipment, utilities, inventory, expansion of office space, etc. CEMA provides the same benefits for the same uses with less restrictions.
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