BUSINESSReceivables purchasing firm NCFE declares bankruptcyOne firm's problems are not indicative of the industry as a whole.By Robert Kazel, amednews staff. Dec. 2, 2002. Doctors' practices and hospitals across the nation last month were urgently trying to find alternative sources of cash after the leading U.S. company that provides financing to health care organizations by taking over their unpaid patient accounts declared Chapter 11 bankruptcy. Dublin, Ohio-based National Century Financial Enterprises on Nov. 18 asked a U.S. Bankruptcy Court for the Southern District of Ohio in Columbus for protection from its creditors. The filing came two days after the FBI raided the company's offices and seized records in an attempt to determine if financial improprieties had spurred the rapid nosedive. As of mid-November, NCFE had not made scheduled financing payments to its clients, including medical practices and national physician staffing firms serving hospitals, for about 45 days. The company's plight already had begun to cause turmoil among some of its clients, even forcing some to consider or to file for Chapter 11 protection themselves. NCFE had been in the receivables purchasing business for 11 years. The company's business rose markedly in the past few years as managed care caused longer payment delays. Physicians' practices and other groups typically entered into three-year contracts with NCFE by which the company would purchase medical receivables for 97 cents on the dollar, minus substantial fees and interest. A monthly reconciliation arrangement was built into the agreement that essentially charged clients if their purchased receivables failed to deliver as hoped. The cut-rate receivables that were acquired were packaged and invested in various bond funds by NCFE.
[...]
Full text of American Medical News content is available to AMA members and paid subscribers.
Copyright 2002 American Medical Association. All rights reserved.
|
The doctors are in the house
The AMA's House of Delegates is holding its Interim Meeting Nov. 7-10 in Houston, addressing issues such as health system reform and physician payment. Meeting coverage - Slideshow Feature articlesHealth reform review The Massachusetts experience Litigation stress Being sued is personal as well as professional Comprehensive coverage
Most-viewed
Nov. 9 issueHouse option for public plan wouldn't limit physician pay to Medicare rates New database for out-of-network pay set to replace disputed Ingenix system Columns and series
From the vault: 5 years agoGenetic testing issues land in primary care practices Nov. 8, 2004 
|
SHARE
