Yes. Healthcare is the fastest-growing MCA segment in 2026, up 4 percentage points in market share since 2022. Medical practices, dental offices, chiropractic practices, veterinary clinics, and behavioral health practices all qualify.
T.A.G. Business Funding · 2026 Guide
Healthcare Business Funding Guide 2026: MCA, Insurance A/R Factoring & SBA for Medical Practices
Healthcare is the fastest-growing MCA segment and has the lowest average factor rate of any industry. A guide to all funding options for medical, dental, chiro, vet, and behavioral health practices, with typical industry figures.
1.22
Avg. factor rate, lowest of any industry
71%
Healthcare MCA approval rate
$67,300
Average advance for healthcare
#1
Fastest-growing MCA segment 2026
1.10
Lowest Observed Rate
The strongest healthcare files, 700+ FICO with a $150K+ advance, have been observed as low as 1.10, the lowest rate in any industry in T.A.G.'s benchmark study.
60-80%
A/R Factoring Advance Rate
Medical A/R factoring advances 60-80% of insurance claim value immediately, often cheaper than MCA for practices with outstanding claims.
+4pp
Market Share Growth
Healthcare grew 4 percentage points in MCA volume share since 2022, the fastest-growing segment in the market per the 2026 MCA Market Report.
$5M
Max SBA for Medical
SBA 7(a) loans up to $5 million are available to medical practices with 2+ years in business and strong credit, typically 10-13% APR. MCA costs more but funds far faster; compare true cost with our factor rate to APR converter.
Practice type moves the numbers. Dental sits near the top of the table below at a 1.20 average factor rate and a 74 percent approval rate.
How Factor Rates Vary by Healthcare Practice Type
Insurance reimbursement deposits are one of the most predictable revenue patterns underwriters see, which is why healthcare as a whole underwrites favorably. Not every healthcare practice looks the same to a funder, though, and the type of practice does affect where an offer lands.
Category
Avg. Factor Rate
Rate Range
Approval Rate
Avg. Advance
Medical / Healthcare (combined)
1.22
1.10-1.35
71%
$67,300
Dental Practices
1.20
1.10-1.35
74%
See combined figure
Source: T.A.G.'s 2026 MCA Factor Rate Benchmark Study and Industry Benchmarks. These two rows are the only healthcare categories with published, T.A.G.-tracked figures.
Within that overall healthcare range, deposit consistency is what tends to move a specific practice toward the favorable end or the more conservative end. This is a general underwriting tendency, not a published rate for every subtype, and your actual factor rate is set by the funding provider after reviewing your specific bank statements.
Toward the Favorable End
Private medical and dental practices with steady insurance-based deposits, and practices with a strong cash or card-pay mix like veterinary clinics, tend to show the most predictable monthly deposit pattern, which is the thing MCA underwriting weighs most heavily.
Standard Range
Chiropractic, physical therapy, and urgent care practices with consistent session-based or per-visit billing typically fall in the middle of the healthcare range.
More Conservative End
Med spas and other largely cash-pay, discretionary-spending practices tend to see more month-to-month deposit variability. Home health agencies leaning heavily on Medicare or Medicaid reimbursement, which can lag longer than commercial insurance, are often underwritten more conservatively for the same reason.
Healthcare Financing Options Compared
Healthcare practices have more financing options than most industries, including medical A/R factoring, which is specifically designed for insurance claim revenue cycles.
LOWEST COST
SBA 7(a) Loan
Best for: Practice expansion, equipment, working capital with a 30-90 day timeline. Cost: 10-13% APR Speed: 30-90 days Requires: 2+ years, 640+ FICO, collateral
A/R DRIVEN
Medical A/R Factoring
Best for: Outstanding insurance claims with a 30-90 day reimbursement lag. Underwritten on payer, not practice credit. Cost: 1-4%/month of claim value Speed: 1-3 days Advance rate: 60-85% of claim face value
EQUIPMENT
Medical Equipment Financing
Best for: Imaging equipment, dental chairs, laser systems, diagnostic tools. Equipment is its own collateral. Cost: 6-18% APR Speed: 3-10 days Requires: 12 months, 600+ FICO
FASTEST
Merchant Cash Advance
Best for: Urgent working capital, payroll, unexpected costs, when insurance reimbursement hasn't cleared yet. Cost: 1.10-1.35 factor rate Speed: Provider-set Requires: 6+ months in business, 500+ FICO, $4K-$6K+/mo deposits, 6 consecutive months of business bank statements
Medical A/R Factoring vs. MCA for Healthcare
If your practice has outstanding insurance claims (a 30-90+ day reimbursement cycle with Medicare, Medicaid, or commercial insurers), medical A/R factoring is almost always the better option than MCA for that specific gap. Factoring advances against the actual claims. The cost is a percentage of the claim value (1-4%/month), which is typically much cheaper than MCA at a 1.22 average factor rate. MCA makes more sense when you need working capital beyond what outstanding A/R covers, or when you need funding faster than provider review and factoring setup would allow.
What Healthcare Practices Use MCA For
Use of Proceeds
Why a Practice Reaches for MCA Here
Better Alternative When Available
Payroll (staff, physicians)
Payroll is due on a fixed schedule regardless of when insurance reimbursement clears
LOC draw, if established
Medical / dental equipment
New or replacement equipment is needed before the revenue it generates has arrived
Medical equipment financing (6-18% APR)
Insurance reimbursement gap
Care has been delivered and billed, but the reimbursement hasn't deposited yet
Medical A/R factoring (often cheaper)
Facility renovation / expansion
A buildout or new location needs capital before patient volume ramps up
SBA 7(a) if time allows
Supplies / inventory
Ongoing supply costs outpace short-term cash on hand
Vendor terms / net-30 accounts
Care is documented and billed within days, but the deposit only lands once the payer finishes its own review, and payroll does not wait for the difference.
The Healthcare Reimbursement Cycle
Care gets delivered and billed right away. The money for it doesn't move nearly as fast, and payroll doesn't wait for the difference.
A patient visit is documented, coded, and billed within days. What happens next is largely out of the practice's hands: the claim has to clear the payer's own review and adjudication process before a reimbursement ever posts to the practice's bank account. Payroll, rent, and staff wages don't get that same grace period. This gap, between when care is delivered and when the deposit actually lands, not the size of the outstanding claim, is what MCA underwriting looks at and what MCA is built to bridge.
When Healthcare MCA Is (and Isn't) the Right Move
MCA is a bridge for a specific, time-boxed cash-flow gap. It is not the cheapest way to fund long-term growth, and it isn't the right tool for every situation.
Before applying, it helps to know what the actual process looks like. The document ask is a signed application plus 6 consecutive months of business bank statements, all pages, non-redacted; personal statements aren't accepted. A driver's license and voided check are only requested after approval, never upfront. The initial review is a soft credit pull, but a hard pull typically happens later, before final approval, with a small, disclosed impact on your score. A personal guarantee is standard on MCA agreements. None of this is unique to healthcare, but a practice owner comparing MCA against SBA, equipment financing, or A/R factoring should know it going in.
Cite This Guide
Torres, C. (2026). Healthcare Business Funding Guide 2026. T.A.G. Business Funding. https://funding.towersassetgroup.com/healthcare-business-funding (CC BY 4.0)
Frequently Asked Questions
Can medical practices get a merchant cash advance?
Yes. Healthcare is the fastest-growing MCA segment in 2026, up 4 percentage points in market share since 2022. Medical practices, dental offices, chiropractic practices, veterinary clinics, and behavioral health practices all qualify, typically with better rates than most other industries. Healthcare businesses average a 1.22 factor rate, the lowest average of any industry in T.A.G.'s 2026 MCA Factor Rate Benchmark Study, because insurance reimbursements tend to create predictable, verifiable deposit patterns.
What is medical accounts receivable factoring?
Medical accounts receivable (A/R) factoring is the sale of outstanding insurance claims or patient invoices to a factoring company in exchange for an immediate cash advance (typically 60-80% of the face value of claims). The factoring company then collects from the insurance carrier or patient directly. Unlike MCA, medical A/R factoring is a sale of receivables, not a loan, and is underwritten on the payer's creditworthiness (the insurer or Medicare/Medicaid), not the practice's credit score. Advance rates vary by payer quality: Medicare/Medicaid claims typically advance at 70-80%, commercial insurance at 75-85%.
Can a new medical practice get funding?
A newly opened practice (under 12 months) has limited options. MCA requires 6+ months in business and 6 consecutive months of business bank statements (personal statements are not accepted). SBA 7(a) loans require 2+ years. The most accessible path for a new practice is: (1) an SBA start-up loan, available to new businesses with strong personal credit and a solid business plan; (2) equipment financing for practice equipment, since the equipment serves as its own collateral; (3) a business line of credit from a bank that already has a relationship with you. CDFI microloans are available for newer practices in underserved communities.
Are there HIPAA considerations for healthcare practice funding?
For most MCA and standard business funding applications, only business financial records (business bank statements, tax returns) are shared. No patient data is involved. Medical A/R factoring may require sharing claim summary data (claim amounts, payer, dates) but should not require patient-identifiable information. Review any data sharing agreement with your factoring company for HIPAA compliance before signing.
Can healthcare practices with insurance billing gaps use MCA?
Yes. Healthcare practices with delayed insurance reimbursement (sometimes 30-90 days) can use MCA to bridge the gap between service delivery and payment. MCA is based on your bank deposit history, not the timing of insurance payouts. Practices with consistent monthly deposits of $4K-$6K+ typically qualify, subject to full underwriting review.
What is the average MCA factor rate for healthcare businesses?
Healthcare businesses average a 1.22 factor rate in 2026, the lowest average across all industries in T.A.G.'s Factor Rate Benchmark Study. The strongest healthcare files, those with the highest credit profiles and largest advance amounts, have been observed as low as 1.10, the lowest rate observed in any industry in that study. The low average reflects healthcare's predictable revenue cycle: monthly insurance payment deposits tend to be far more consistent than in cash-based or seasonal businesses, which funders can underwrite with more confidence.
Get Funding for Your Healthcare Practice
T.A.G. works with medical, dental, chiro, vet, and behavioral health practices. We present multiple offers and recommend lower-cost alternatives when available.
