Health and care practices
Home Health and Senior Care Funding
Home health and home care agencies borrow to carry payroll ahead of Medicare, Medicaid and private payment, and senior care facilities borrow to buy, build or fill a licensed building. Working-capital, receivables, SBA and real estate lenders all write the industry.
What lenders weigh in a home health, hospice & senior care file
- Licenses, Medicare certification, accreditation and the state survey history, because a lender funds an agency or facility that can keep operating and billing.
- Payer mix and the receivables aging, since Medicare, Medicaid managed care, long-term care insurance and private pay each remit on a different clock and at a different rate.
- Payroll discipline: caregiver classification, payroll tax deposits and turnover, because people are the cost and the lender is often funding the payroll itself.
- For a facility, occupancy and the rate roll read against the appraisal, with a fill schedule and a working-capital cushion for anything not yet stabilized.
- Concentration in one referral source, one managed care plan or one facility contract, priced for its term and the risk of losing it.
- Operator experience, since a lender funding a start-up agency or a first facility wants a licensed administrator or an experienced partner on the file.
What gets funded
- Working-capital lines of credit: Sized to the receivables aging, the line carries payroll between the visit and the payer's remittance. Banks write them for agencies with history, and non-bank lenders write them on statements and the aging for younger ones.
- Healthcare receivables financing: Advances against billed Medicare, Medicaid and commercial claims, collected through a controlled deposit account because government payments must reach the provider. Grows with billing and fits a fast-growing agency.
- SBA 7(a) for start-ups, acquisitions and small facilities: Agencies and facilities are eligible under 13 CFR 120.110. The common route to a new agency, an agency purchase, a residential care home conversion or a small facility purchase, with working capital included in the loan.
- SBA 504 and conventional real estate loans: Fund the building and buildout of an owner-occupied assisted living or memory care facility, underwritten on the appraisal and the stabilized cash flow, usually with a larger down payment on the conventional side.
- Bridge and construction loans: Private lenders carry a facility that is not yet stabilized, whether a lease-up, a value-add renovation or a ground-up build, and are refinanced into permanent debt once the census supports it.
- Term loans for acquisitions and expansions: Banks and private lenders fund a defined project, a new county, a new service line or an agency purchase, repaid monthly from cash flow rather than revolving with the receivables.
Home Health, Hospice & Senior Care funding guides
- Assisted Living and Senior Care Facility Financing: Real Estate, Buildout and Working Capital — Assisted living facilities are financed as owner-occupied real estate by SBA 7(a) and 504 lenders, banks, bridge and construction lenders, with census, payer mix and the license read alongside the appraisal.
- Home Health Care Business Loans: Payroll, Licensing and Growth Capital — Home health care business loans come from working-capital lenders, healthcare receivables lenders, SBA 7(a) lenders and banks, and most of the capital carries payroll between the visit and the payer's payment.
How MercFinancial places home health, hospice & senior care requests
MercFinancial is a commercial funding brokerage in Houston, not a lender, and it has no home health or senior care program and no promise of approval. A request starts with the file: the licenses and survey history, the aging by payer, the payroll and the statements, and for a facility the census, the rate roll and the property, along with what the money is for. From there, the funding sources among MercFinancial's more than 160 whose credit policy allows home-based care or senior care facilities and the structure in question are identified, one file is placed with all of them, and the offers are compared side by side.
Whether any product is available depends on the funding source, and when nothing fits yet, you are told that plainly along with what would change the answer. Stephanie, the lending assistant, pre-qualifies a request in a few minutes with a soft credit pull that does not affect your score, and a free call with a funding specialist is booked at the contact page.
Frequently asked questions
Can a home health agency get a business loan?
Yes, and the product is usually chosen by the receivables. Working-capital lines and healthcare receivables financing carry payroll between the visit and the payer's remittance, SBA 7(a) funds a start-up, an acquisition or an expansion, and term loans fund a defined project. Which fits depends on the agency's licenses, its aging by payer, its history and the funding source's policy.
How do senior care facilities get financed?
As owner-occupied real estate with an operating business underwritten on top. SBA 7(a) funds a small facility purchase or a residential conversion with working capital included, SBA 504 and conventional banks fund the building and buildout of a stabilized facility, and bridge and construction lenders carry a facility through lease-up, renovation or a ground-up build until census supports permanent debt.
Can I factor home health receivables?
In practice, yes, through healthcare receivables financing. Because Medicare and Medicaid payments must be made to the provider, the lender advances against billed claims and collects through a controlled deposit account that sweeps the payments as they arrive, which is standard in healthcare lending. Advances are a share of the net collectible value of the claims, and the facility grows as billing grows.
Can I get a loan to start a home care agency?
Usually through SBA 7(a) or an unsecured loan on the owner's credit, since a start-up has no receivables to lend against. Lenders want the state license issued or in process, an owner with healthcare or agency experience, an equity injection, a staffing and referral plan, and a budget that carries payroll for the months before the first payers remit.
What do lenders ask a home health or senior care business for?
Licenses, certification and accreditation, the most recent survey and plan of correction, the receivables aging by payer, payroll registers and tax compliance, business and personal tax returns, interim financials, bank statements and a personal financial statement from each owner. A facility adds the resident roster and rate roll, occupancy history, the property documents and a lease-up budget.
Financing for this industry
- Business Funding — Eight programs, one file, 160+ lenders.
- Unsecured Business Loans — Term loans and lines without specific collateral, for businesses with steady deposits.
- Real Estate Funding — DSCR, fix and flip, construction, bridge and portfolio loans for investors.
Related industries
MercFinancial is a commercial funding brokerage, not a lender. Approval, loan amount, rate, term and funding are decided by the funding source on the strength of the file; nothing on this page is an offer or a commitment to lend.