Medical practices and their doctors and administrators face a slew of special business and personal financial management challenges. For example:
- How do you finance six- and even seven-figure diagnostic equipment when the practice's balance sheet shows zero on the bottom line?
- How do you maintain business profitability under the constant pressure of check fraud attacks?
- How do you finance the purchase of a home early in your career when pay has yet to escalate and you're saddled with student loan debt?
For medical practices and their doctors and administrators, the starting point for addressing these and other financial challenges is choosing the right bank, one that is committed to serving their needs – and one that has the knowledge and service philosophy to do so.
Medical Private Banking Group
First Tennessee Bank has made that commitment. In January 2011, the bank formed its Medical Private Banking Group, which provides high-quality, specialized financial services to the medical community. The group takes a team approach to addressing the business credit, treasury management, and personal banking needs of medical practices and their physicians and administrators.
"Over the years, First Tennessee Bank has had a strong focus on serving the medical industry," says Michelle Hardin, Senior Vice President in the new group. "But we saw that our medical industry clients could benefit from a banking group dedicated solely to meeting their business and personal financial needs.
"Our medical practice clients can benefit from having bankers who understand how emerging laws and regulations, such as Medicare reimbursement reform, impact their finances," she says. "And on the personal banking side, we know that medical professionals work long hours and need bankers who can meet with them outside the 9-to-5 work day."
Hardin regularly meets with administrators at medical practice clients to give them what she calls a "financial physical," where she reviews their current banking practices and helps identify their pain points. Hardin then ushers in group specialists in business credit and treasury management to address the needs that emerge. She can also bring in financial planning specialists to consult one-on-one with administrators and physicians about their personal financial needs.
The balance sheet of a typical medical practice differs from that of most other businesses because practices typically "manage to the bottom line," meaning the doctors extract the cash out of the business, Hardin explains. Medical practices also often need extremely expensive diagnostic equipment – for example, an MRI machine can cost over $1 million – and require reasonable financing terms to obtain it.
"At First Tennessee, because of our experience working with medical industry clients, we understand their special financing needs and know what information we need to request beyond balance sheets and income statements in order to do a proper credit analysis and offer the financing that clients need," Hardin says.
Medical practices are common targets for check fraud, and First Tennessee has successfully worked with many practices to implement Positive Pay check fraud protection. With Positive Pay, the practice regularly reports check issuance information to First Tennessee. The bank matches checks presented for payment against that issuance data and reports potentially fraudulent items to the practice, which can then tell First Tennessee whether or not to pay the item.
Another popular service among medical practices these days is Remote Deposit Capture, which enables them to deposit patients' check payments into their First Tennessee bank account electronically without having someone from the office physically transport those checks to a local bank branch.
Other First Tennessee treasury management services being used by many medical practices include Electronic Bill Payment and purchasing cards. Electronic Bill Payment enables clients to pay for services online, which helps boost collections and gives patients an additional welcome payment option. A Visa® Purchasing Card program eliminates inefficient, paper-intensive ordering processes and can generate significant cash rebates when used for big-ticket items such as medical equipment.
Hospitals and larger practices can also address many of their receivables management challenges using Healthcare Lockbox services. Healthcare Lockbox takes remittance payments received from an insurance company (paper or electronic) and puts them into an industry-standard format that can be viewed through a secure Web site and electronically transmitted for automated posting to the provider's practice management system.
First Tennessee offers qualifying physicians 100% financing on their primary residences, with very competitive rates. In addition, the Medical Private Banking Group includes a certified financial planner™ professional and a financial advisor who consult with doctors at no additional cost.
The bank also offers a complimentary account aggregation service, which offers an online, up-to-date summary of a physician's depository and investment accounts across multiple financial services providers – essentially establishing an easily accessible personal balance sheet. "We have staff members dedicated to setting these sites up for our medical clients," Hardin says.
The private client experience
First Tennessee's goal is to provide busy doctors with a concierge style personal banking service. "We want to make visits to the branch unnecessary," Hardin says. "We meet with doctors by phone or at their office or some other convenient location, often outside traditional working hours."
To learn more about how doctors and their medical practices can benefit from the specialized services of First Tennessee's Medical Private Banking Group, contact your bank representative.