Transcarent Financial Model

• Single app/web/phone access point to health services 24/7.
• Service categories: urgent care (telehealth in 60 sec, or at-home), pharmacy, musculoskeletal/PT, surgery coordination, hospital at home, expert second opinions.
• Technology layer: predictive data science, personalization, member self-navigation with live guides available 24/7.
• Network: direct-contracted, high-value providers and digital solutions; one contract for providers.
• Additive to existing benefits; turnkey implementation (go-live within 90 days).
• Client-side: single contract, implementation, and analytics package; full-risk pricing options.

• 162M consumers covered by employers in the US.
• $1.1T annual health spend by employers (assumes $7,000 PPPY).
• Currently addressable (live services - urgent care, musculoskeletal, surgery): 20% of health spend = $226B immediately addressable opportunity.
• Roadmap to 90% of member health spend (~$1T addressable) by 2023 as service lines expand (pharmacy, cancer, behavioral, primary care, cardiometabolic, women's health, etc.).
• 2020 baseline: surgery only (~10% of spend, ~$100B).

Three-component pricing model:

1. Subscription - Per Employee Per Month (PEPM) fee; recurring baseline revenue.
2. Utilization-based - Case rates for care episodes delivered (telehealth, PT, surgery, etc.).
3. Full-Risk / Performance-Based - Either (a) subscription fees placed at-risk against savings/outcome/experience goals, or (b) shared savings: Transcarent paid 30% of actual savings realized, settled quarterly and annually.

Sales channels: large employers, health system employers, mid-market employers, government employers, labor/unions, TPAs/payors.

• 1M covered lives.
• 80+ clients including Delta, Target, Albertsons, GEHA, Meritain Health, NRECA, UNFI, and others.
• NPS 80+.
• 40% reduction in urgent and emergency room visits.
• 33% reduction in unnecessary surgeries.
• 80% reduction in readmissions and complications.
• 2–8% reduction in total cost of care from shift to high-value providers.
• 30%+ of covered lives targeted to activate as members via data-science-driven marketing.
• 85% member retention; 97% client retention.
• Utilization rates (as % of activated members): telehealth up to 100%; virtual PT and expert opinions 3–10%; surgeries 0.3%.

No revenue ($) figures, ARR, or growth rate shown in deck.

• PEPM subscription provides recurring per-employee revenue base.
• Shared savings model: 30% of realized savings paid to Transcarent quarterly/annually.
• 2–8% cost-of-care reduction implies a savings pool from which the performance-based revenue is derived.
• PEPM rate not disclosed.

• Positions as a new category ("Experience Era") analogous to Uber (transportation), Travelocity (travel), Netflix (entertainment) - direct consumer-provider connection.
• Moat claims: integrated platform (vs. point solutions), full-risk alignment, single contract/implementation, proprietary data science for personalization, live guide layer, direct provider contracts.
• No explicit competitor names or competitive matrix in deck.

Team (slide 8 - all senior hires from digital health incumbents):

• Glen Tullman, CEO - Livongo, Allscripts, 7wire
• Snezana Mahon, COO - Express Scripts / Evernorth
• Stephanie Peng, CFO - Teladoc, Livongo, KPMG
• Jamie Hall, CCO - BCBSA, BridgeHealth
• Jeff Dobro MD, Chief Innovation Officer - Mercer, One Medical, WTW
• Praful Kaul, CTO - Rally Health, Zynga
• Erica Davila, General Counsel - Zocdoc, Haven, JPMC
• David Zieg MD, CMO - Mercer, Lockheed Martin
• (+ 4 further VPs/SVPs)

• Archetype + why: B2B2C digital health / benefits platform model - hybrid PEPM subscription + utilization-based case-rate + performance/shared-savings revenue. Closest archetype is an employer-benefits SaaS model with a utilization overlay (analogous to a healthcare navigation/navigation platform). NOT a pure SaaS ARR model (revenue has three streams with very different drivers). Recommend a multi-stream P&L / 3-statement model with discrete PEPM, case-rate, and shared-savings revenue schedules.

• Forecast horizon & granularity: 5-year annual (2022–2026) with monthly granularity for Year 1; quarterly for Years 2–3. Deck is December 2021 Series C, so model starts Jan 2022.

• Key drivers & assumptions:

*Client & lives growth*

• Clients at period start: 80+; new clients per year
• Average covered lives per client
• Member activation rate: 30%+ of covered lives;
• Member retention: 85% annually
• Client retention: 97% annually

*Revenue per stream*

• PEPM rate
• Utilization rates (as % of activated members): telehealth up to 100%, PT/expert 3–10%, surgery 0.3%
• Case rates per episode
• Shared savings take rate: 30% of realized savings
• Assumed cost-of-care reduction enabling savings pool: 2–8% of covered spend;
• Spend per covered life: $7,000/yr

*Cost structure*

• COGS: care coordination staff, provider network payments, platform infrastructure
• S&M: enterprise sales team, multi-channel (TPAs, payors, unions, gov't)
• R&D: data science, platform development
• G&A: leadership-heavy team (12 C-suite/SVP), legal, finance

*Market expansion*

• Addressable spend coverage: 20% in 2022, expanding per roadmap to 50–60% (2022) and 90% (2023)

• Scenarios (Base / Bull / Bear - which variables flex):
• Base: 30% activation, $18 PEPM, 4% cost reduction, 40 new clients/yr, case rates at midpoints
• Bull: 35% activation, $22 PEPM, 6% cost reduction, 60 new clients/yr, faster service line expansion
• Bear: 25% activation, $15 PEPM, 2% cost reduction, 20 new clients/yr, slower TPA/payor channel ramp

• Required sheets / outputs:

1. Assumptions - all drivers with Base/Bull/Bear toggles
2. Client & Lives Build - client count, covered lives, activated members by year
3. Revenue Schedule - PEPM stream, utilization/case-rate stream, shared-savings stream, total revenue
4. P&L (Income Statement) - revenue, COGS, gross profit, OpEx (S&M, R&D, G&A), EBITDA, net income
5. Cash Flow - operating cash, burn rate, runway (critical for Series C sizing)
6. Balance Sheet (simplified)
7. KPIs Summary - covered lives, active members, clients, PEPM yield, gross margin %, NPS (reference)
8. Dashboard - charts: revenue by stream, lives/members growth, client count, gross margin bridge