Business Loans for Behavioral Health and Substance Abuse Facilities

Easy Financing for Healthcare Businesses and Doctors

Loans for Behavioral Health and Substance Abuse Facilities

It's no secret that opioid addiction and mental health issues are two of the major public health challenges now affecting society. Over 12% of American adults are already utilising medication to address anxiety symptoms alone, according to survey data from the CDC. The CDC also notes that since 1999, the number of deaths from opioid-related overdoses has been rising yearly.

Additionally, the current pandemic has made it clear that the healthcare system is even more important than we previously thought. Providing additional care to the residents of your community is a huge assistance in a challenging world, even if your institution isn't designed to treat the coronavirus.

An entrepreneur can do good by their society by opening a treatment centre for one or both of these problems. The issue is that, in contrast to a company like a bakery or a yoga class, opening the doors and assisting patients in their quest for rehabilitation requires a large amount of up-front expenditures, paperwork, and background work.

Costs of opening a treatment facility

You're going to need to do some preliminary research to comprehend your precise ambitions and aims as a health provider before you even contemplate which forms of loans you could like to seek out.

A health centre, such as one for substance misuse or mental illness, won't run like a typical company. Compared to other businesses, healthcare providers have a considerably more extensive set of licences, certificates, and accreditations. Thus, it will be crucial to comprehend your objectives and carry out a feasibility research.

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When setting goals, consider what you want to particularly address and how you plan to do so. Will you prioritise mental health? disorders caused by drug abuse?

What kinds of therapeutic treatments are you planning to provide? Do you want to mostly offer outpatient therapies? Intensive treatment? A residential programme? Would you like to provide persons seeking substance addiction treatment sober housing?

For all treatment centres, knowing exactly what and how you intend to provide treatment is a crucial first step. You can only proceed to the following stage if you've chosen your targets.

GetCapitalToday offers loans to small businesses that meet these criteria:

  • Business based in the US with 1 year in running
  • Cash flow that is stable or at least $15,000 per month

*Terms and conditions apply.


Studies of feasibility

Because they help you comprehend what is required on the ground, feasibility studies assist you in determining the precise amount of funding you'll need to launch your facility.

The study will assist you in comprehending a number of critical aspects, including the degree of market saturation, the gravity of the issues in your industry, and more. If your feasibility study reveals that your neighbourhood already has several other facilities of a similar size that aren't operating at full capacity, you don't want to establish a 500-bed behavioural health services centre. therapy for substance use disorders is a worthwhile and worthwhile endeavour, but the size of the facility and the kind of therapy provided should be tailored to the kinds and degrees of drug use in the neighbourhood.

Additionally, knowing the market can assist you in planning each subsequent step: how much real estate is required? How large is the staff? You will require therapists and other medical personnel if you are providing inpatient drug misuse treatment, in addition to food service personnel, management, custodial staff, executives, and intake personnel. An inpatient hospital with room for patients to roam around, see family members, dine, or exercise will require significantly more space than a tiny outpatient facility.

The marketing budget must also be taken into account. The cost of effectively marketing your new facility can reach the mid-five-figure range. Unfortunately, even providing medical care is a business, and you can't provide care if you aren't making money.

Knowing what your market requires can help you create staffing and real estate budgets, which will guide the way you approach funding applications.

Best kind of loans for behavioral health and substance abuse facilities

Traditional Loans

Traditional loans are exactly what you image when you think of a loan; they are provided by financial institutions. The financial institution assesses the qualities of the prospective borrower as a borrower, taking into account their credit history (personal and/or business), business strategy, industry, assets, and the amount of the loan requested. If accepted, the borrower will pay back the loan in full by making regular principal and interest payments.

Lenders should use caution when choosing the businesses to which they are making loans. Even while providing assistance to those in need through a public health facility is a commendable economic endeavour, banks will nonetheless base their loan decisions on the likelihood of receiving interest payments. Due diligence when it comes to your plan and feasibility research is crucial because of this. You must demonstrate to the lender that it is highly likely that a loan for your business will be repaid.

Equipment Loans

You'll probably need to buy or lease some highly expensive equipment for medication storage, testing, or diagnosis if your treatment centre plans to offer medication-assisted treatment or any other inpatient treatment for drug addiction or mental illness. A residential treatment facility will also need equipment for preparing and storing meals and beverages. Additionally, computers will be needed for case management and storing health information. to say the least. All of this is to indicate that you'll probably need to buy a lot of items.

Equipment loans are created specifically for this use. The new equipment will be held as collateral by the lender in an equipment loan. As a result, the lender's financial risk is reduced and the equipment can be repossessed if the borrower can't make payments on the loan.

Equipment loans are likely to be a wonderful bet if the major demand for funding for your behavioural health or drug abuse facility loan is some form of equipment, rather than labour, real estate, or any other expense.

Small Business Administration (SBA) Loans

SBA loans are probably your best choice if you're an eligible borrower. Financial institutions are supported by the Small Business Administration (SBA) of the United States. Take into account that these loans are conventional ones that carry lower risk for the financial institution. In a conventional loan, the bank risks suffering a sizable loss if the borrower fails. With an SBA loan, the federal government guarantees the loan, minimising any losses to the bank in the event of borrower default.

SBA loans for facilities that provide drug or alcohol abuse treatment have many advantages. To begin with, you can use an SBA loan to cover a variety of costs. Numerous hires, real estate purchases, new or upgraded equipment purchases, building renovations, practise acquisitions, and debt refinancing are all options. SBA loans have a maximum size of $5 million.

However, only highly qualified borrowers need to apply because the loans are insured by tax dollars. You'll have to submit a tonne of information, including the financial accounts for your facility, proof of licencing, copies of prior loan applications, tax returns, resumes, and more.

Given the eligibility criterion of several years of financial data, SBA loans probably won't be very useful if you're wanting to start a mental health or addiction treatment centre from scratch. However, they're a terrific place to explore if you're trying to update, extend, or buy new services for your current offerings.


Local, state, and federal governments as well as some nonprofits and for-profit companies frequently make sizeable grants to aid these enterprises treat those in need due to the public safety component of treatment centres like the ones we're talking here.

The federal government offers assistance as well. The U.S. Department of Health and Human Services has a division called the Substance Abuse and Mental Health Services Administration (SAMHSA) that supports the treatment centres we've been talking about.

The agency's website offers a wealth of tools for administrators and owners of facilities, but it also excels at acting as a one-stop shop for facilities looking for grant money. The website has a page devoted to detailing the many grant programmes that are accessible, along with deadlines and other useful details, such as contact details for the organisations providing the grant and other technical assistance.

The key to public health is the treatment of mental health disorders and substance use disorders

Starting, acquiring, or growing a facility for these programmes is a hugely beneficial endeavour, whether you're trying to aid folks who are struggling with alcoholism, mental illness, or chemical addiction. If you're thinking about making such a business decision, make sure you know the local need for a facility of this type, how you intend to market to and care for your patients, and how to finance such a costly and challenging venture.