by Mark Spradling, Steve Tarry and David Keyes
Recent developments, both positive and negative, have focused attention on the practice of securitizing health care receivables. Vinson & Elkins has worked with a number of health care clients to develop a method for their securitization of accounts receivable, including government receivables, as an alternative source of liquidity to traditional borrowing. Specifically, our clients have accelerated the receipt of the present value of their accounts receivable by selling the accounts to financial institutions at a discount in transactions similar to the centuries-old practice of "factoring." The seller continues to "service" the accounts for the purchaser (e.g., the seller sends out notices, initiates collection efforts). As the attached article demonstrates, securitizations require careful structuring to take advantage of favorable changes in the Uniform Commercial Code, to comply with new patient information privacy requirements, and to avoid the pitfalls of Purchaser and Servicer bankruptcies. http://healthcenter.bna.com/pic2/hc.nsf/id/BNAP-5GRL8Z?OpenDocument.
This material is not intended to create, and does not create, an attorney-client relationship between you and Vinson & Elkins L.L.P., and you should not act or rely on any of this information. As legal advice must be tailored to the specific circumstances of each case, nothing provided herein should be used as a substitute for advice of competent counsel. These materials do not constitute legal advice, do not necessarily reflect the opinions of Vinson & Elkins L.L.P. or any of its attorneys or clients, and are not guaranteed to be correct, complete, or up-to-date.
Vinson & Elkins L.L.P. assumes no liability for the use or interpretation of information contained herein. This publication is provided "AS IS" WITHOUT WARRANTY OF ANY KIND, EITHER EXPRESSED OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, THE IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, OR NON-INFRINGEMENT. Unless otherwise indicated, V&E attorneys listed are: not Certified by the Texas Board of Legal Specialization. None of the attorneys listed on this website is certified as an "expert" or "specialist" pursuant to any authority governing the practice of law in New York. Vinson & Elkins is a registered limited liability partnership. Principal office-Houston.