Definitions

Amortiztion: paying off a debt over time in equal installments. Part of each payment goes toward the loan principal, and part goes toward interest. With mortgage amortization, the amount going toward principal starts out small, and gradually grows larger month by month. Meanwhile, the amount going toward interest declines month by month for fixed-rate loans

APR: annual percentage rate, or APR, is a way of measuring the full cost a lender charges per year for funds. Typically associated with mortgages, loans and credit cards, APR combines the total amount of interest payable and the cost of other fees and charges, averaged over the term of the loan and expressed as a percentage

Billers: medical billing companies or individuals using billing software to execute insurance claim on behalf of a provider

Blockchain: a digital, public ledger that records online transactions. Blockchain is the core technology for cryptocurrencies and is regarded as more secure when applied to healthcare and financial data. A blockchain ensures the integrity of a cryptocurrency by encrypting, validating, and permanently recording transactions. A blockchain is similar to a bank’s ledger but open and accessible to everyone who utilizes the cryptocurrency it supports

Borrowing base: the amount of money a lender will loan to a company based on the value of the collateral the company pledges. The borrowing base is usually determined by a method called marginalizing, in which the lender determines a discount factor that is multiplied by the value of the collateral

Cash flow: an indication of whether a company is likely to remain solvent, and knowing how to improve cash flow is an important part of maintaining a successful business.
In computing cash flow, Incoming cash takes the form of:

  • Sales of goods and services
  • Sales of assets
  • Loan proceeds
  • Investments

Claims adjudication: a phrase used in the insurance industry to refer to the process of paying (or adjusting the amount) of claims submitted or denying them after comparing claims to the benefit or coverage requirements

Clearinghouses: companies that function as intermediaries who forward claims information from healthcare providers to insurance payers are known as clearinghouses. In what is called claims scrubbing, clearinghouses check the claim for errors and verify that it is compatible with the payer software

Convert2Pay™: a machine learning technology platform that connects businesses

Covenant: a promise on the part of businesses that borrow money to uphold certain conditions stated in its loan agreement. They’re meant to protect the creditor from the risk associated with lending. Covenants compel borrowers to maintain their physical assets and forbid them from taking certain actions that could affect their assets’ level of equity

Credit agreement: a legally binding contract made between a person who borrows money and the lender. It is agreed upon by both parties and outlines the terms of repayment, the fees, other costs and all the rules and requirements pertaining to the loan

Credit Line: a flexible loan option offered by financial institutions to individuals and corporate entities. A credit line always has a credit limit, which is the highest amount of credit the bank has extended to a particular client. The credit limit is based on the borrower’s income, credit history, and other factors. Credit lines usually range from 20-35 percent of yearly sales

Debt Structure: debt-to-income ratio refers to how much of a borrower’s monthly income is eaten up by debt. Business lenders want to know what’s left over after all monthly bills are paid. The ratio is calculated by dividing monthly debt payments by gross monthly income. It’s a key barometer for lending someone money

Fees in APR: a term used to highlight the additional costs incurred when getting a loan, such as a mortgage. The annual percentage rate is always higher than the simple interest rate quoted by the lender because it includes other costs, such as loan origination fees

FICO score: the Fair Isaac Corp., known as FICO, is a company that specializes in what it calls “predictive analytics.” It collects information about several areas of your financial life and by assigning a value to each of five factors, it predicts whether or not you are a good credit risk. The FICO score it assigns you based on its credit analysis offers a quick insight into your creditworthiness, with 300 being the worst credit score and 850 the best

FinCare: the application of financial technology to healthcare

Lenders: banks or funds

Life cycle of a transasction: from the date of service to a patient to deposit in bank account

Loan origination: the term used to describe the process that occurs when a buyer obtains a loan from a lender. It involves several stages, starting with the loan application by the borrower, the submission of appropriate documentation, the lender’s assessment of the application and the final granting of the loan

Machine Learning: a computer that refines projections as it sees more data

Net Asset Value (NAV): value of asset(s) as determined from historical billing data over the previous 12 months

NPI: the National Provider Identifier (NPI) is a Health Insurance Portability and Accountability Act (HIPAA) Administrative Simplification Standard. The NPI is a unique identification number for covered health care providers. Covered health care providers and all health plans and health care clearinghouses must use the NPIs in the administrative and financial transactions adopted under HIPAA

Payers: over 3,000 insurance companies like United Healthcare

Peer-to-peer data exchange: a system with features that can include preventing people from getting multiple opioid prescriptions and verifying clinical trial data. The hope is that this function can also be used to shrink processing time for prior-authorization requests down to less than five minutes

Physician credentialing: a company called ProCredEx recently launched Professional Credentials Exchange to do this with a private Medicare claims processor, a private provider of Medicaid managed care and Medicare Advantage plans, and the Michigan-based Spectrum Health System

Proof of work: in medical liability cases where attorneys may claim that physician defendants have altered their records, clinical notes entered in blockchain time-stamped blocks create a tamper-proof ledger of what a physician did and when

Provider(s): a person or group providing healthcare services

Smart contracts: contracts automatically go into effect when certain previously agreed upon conditions are met

Supply chain processes: the new technology could make supply chains more efficient and transparent, improving the warehousing and delivery of medical goods and supplies

Variance: changes in revenue for a specified time. Daily, weekly, or monthly changes of submissions (claims) by a Provider