Health Provider company offers health-care-related services and to reduce administrative obligations and to allow for additional financing options for its patients, Health Provider enters into a health services financing agreement with a bank. 1. Under this agreement, patients have the option of requesting that the company transfer its receivables to the bank. Once such a request is made, the following would occur: The company would transfer the patients receivables to the bank. The bank would pay the company the balance of the receivables in cash. Because the bank would now hold the receivables from the patient, the patient and bank would enter into a low-interest loan agreement to stipulate the repayment terms. 2. The agreement between the company and the bank contains the following additional provisions: Repurchase obligation: the company is required to repurchase the transferred receivables. Termination payment obligation: upon the termination of the agreement, the company is required to repurchase all transferred receivables held by the bank, unless otherwise agreed to in writing. Either party may terminate the agreement as long as 30 days notice is given. Although it has not yet happened, company management believes that it will receive a true sale opinion from its legal counsel regarding the transferred receivables. The agreements do not prohibit the bank from transferring the receivables to another party either as collateral for a borrowing or in an outright sale.

Do you have any suggestions for Health Provider company? And why?