THE Spark Financial Model v5

Model Inputs · Sources · Methodology

Key Assumptions

Ramp Model · Spark

Schedule18-month conservative

M1 members20 per 1,000-target clinic

M12 members650 per 1,000-target clinic

M18 members950 per 1,000-target clinic

PMPM range—

Breakeven (single clinic)Month 8–9 · ~350 members

Member cap per clinic1,000

Y4/Y5Steady state · no expansion

Penetration (toggled)—

Panel Composition · NE Georgia Mix

APCM G0558 · QMB/Dual30% of panel · 80% enrollment

CCM 99490/9948745% of panel · 70% enrollment

APCM G0557 · Std FFS15% of panel · 75% enrollment

APCM G0556 · Low acuity8% of panel · 60% enrollment

RPM enrolled~42% of panel at terminal

Revenue Model · Audit-Corrected

Revenue structureMembership + Ancillary net

CCM billing success rate82% (15–20% fallout)

APCM codes (G0556/G0557)Included · $117K/yr/1,000 mbrs

RPM device COGS$55/enrolled/mo deducted

Lab cartridge COGS49% of gross deducted

Vaccine COGS55% of gross deducted

Claim denial write-off2.5% of gross revenue

NP billing rate85% of physician PFS

HPSA 10% Medicare Bonus · All 10 Counties Qualified

Designation sourceGeorgia DCH Primary Care HPSA Map · HRSA/BPHC · active 2026

Qualifying countiesAll 10 — Habersham · Lumpkin · Stephens · White · Rabun · Union · Fannin · Gilmer · Gordon · Chattooga

Eligible codes (10% applied)E&M visits · AWV (G0438/G0439) · G2211 add-on · TOC (99495/99496)

NOT eligibleCCM (99490 series) · APCM (G0556/G0557/G0558) · RPM codes — care mgmt ≠ professional service

Billing structure req.Must bill under supervising physician NPI — NP independent billing forfeits bonus

Statutory authoritySocial Security Act §1833(m) · CMS CR 14265 eff. Jan 1 2026

Enrollment Toggle · Independent

Base1.0× enrollment rates as audited

+15% Uplift1.15× on all program enrollment rates + E&M visit frequency

PMPM Ceiling Toggle · Independent · Multiplier-Based

Base · 1.0×1.0× membership revenue · actual PMPM: —

Growth · 1.1×—

Optimistic · 1.2×—

Active scenario PMPM—

Scalar denominator—

ComposabilityAll 4 toggles fully independent

E&M Visit Frequency · v2 Ramp

Visits per enrolled member per year · ramped by portfolio month · not a static assumption

Y1 (M1–M12) · flat4.0 visits/member/yr

Y2 ramp (M13–M24) · linear4.0 → 6.5 visits/member/yr

Y3–Y5 (M25+) · steady state6.5 visits/member/yr

Optimistic scenario (+15%)4.6 → 7.5 visits/member/yr

Ramp basisClinic-relative month · not portfolio month

RationaleEach county starts fresh — new community, new relationships, same trust-building curve regardless of when the portfolio opened

Industry benchmark (chronic FFS)10–13 visits/yr across all physicians

Primary care share of above~4–5 visits/yr to PCP specifically

Rural NE GA current baseline1.4 visits/yr (problem we solve)

Concurrent billing noteE&M + CCM/APCM separately billable

Visit time excluded from CCMFace-to-face time not counted toward 20-min CCM threshold

Staffing · Spark Stage-Based

Physician modelRemote delegating MD

Remote MD cost$30K–$54K/clinic/yr by stage

Incident-to billingNot modeled

Staff scaling triggerMember count (not year)

2nd NP hired at~550 members · ready at 650

Driver — 1 per active clinic$45,000/yr · scales with expansion

v4: Benefits on clinic staffStaged 18% Y1 → 19.75% Y2 → 21.5% Y3 → 23.25% Y4 → 25% Y5

v4: Merit increases (all staff)1.5% Y2 · 2.5% Y3 · 3.0% Y4 · 3.0% Y5

v4: Clinic headcount Y4/Y5+15% in Y4 & Y5

Cost multiplier—

Portfolio breakeven—

Clinic Staff · Per-Stage Breakdown · Base Salaries

Stage-driven by member count · each clinic runs its own clock · Driver $45K/yr added to every stage · v4: Benefits staged 18%→25% · +15% headcount Y4/Y5

Role	S0 Launch 0–200 members	S1 Building 200–400 members	S2 Steady 400–650 members	S3 Two-NP 650–800 members	S4 Full 800–1,000 members
NP / APRN	$125,000	$125,000	$125,000	$125,000 + $118,000	$130,000 + $122,000
LPN	$52,000	$52,000	$52,000	$52,000 + $52,000	$54,000 + $52,000
Care Coordinator	—	$28,000 (0.5 FTE)	$55,000	$55,000 + $55,000	$58,000 + $58,000
Remote MD (retainer)	$30,000	$34,000	$42,000	$54,000	$54,000
Admin	—	—	$22,000 (PT)	$52,000	$55,000
Driver (per clinic)	$45,000	$45,000	$45,000	$45,000	$45,000
Stage Total (base)	$252,000	$284,000	$341,000	$608,000	$628,000
Loaded Y1 (×1.18 benefits)	$297,360	$335,120	$402,380	$717,440	$741,040
Loaded Y5 (×1.25 benefits)	$315,000	$355,000	$426,250	$760,000	$785,000

Note: MD is 1099 retainer — no benefits load applied to MD line. Benefits load applies to all W-2 roles only. v4 merit increases applied on top of loaded costs.

Expansion · FIRARA Sequence

Y1: Habersham (5,066 FFS)Launch M1

Y1: Lumpkin (3,946 FFS)Launch M3

Y1: Stephens (3,554 FFS)Launch M5

Y2: White + RabunLaunch M13

Y2: Union (5,571 FFS)Launch M15

Y3: Fannin + GilmerLaunch M25

Y3: Gordon → ChattoogaM27 · M29

Y4: No expansionSteady state · 10 clinics

Y5: No expansionSteady state · 10 clinics

MSO Staff · By Year · Engine Computed

—

⚠ v4 CHANGES: Clinic staff now carries staged benefits load (18% Y1→25% Y5). All staff earn tiered merit increases (1.5% Y2 · 2.5% Y3 · 3.0% Y4–Y5). Clinic headcount +15% in Y4/Y5. MSO Staff +$300K added to Y3, carried forward with merit. MSO Ops increased Y4/Y5. Clinic Ops +$350K portfolio Y4/Y5. Confirm with CPA/HR before finalizing.

Year 1 · Named Roles + 25% Benefits + 10% Additional Staffing

Y1 MSO Staff Total$1,400,000

Year 2 · +5 Named Roles + 10% Additional · —

CFO ($181,250 × 1.25)$226,563

VP Business Development ($137,500 × 1.25)$171,875

Legal / Reg Compliance ($118,750 × 1.25)$148,438

Community Relations ($93,750 × 1.25)$117,188

Billing Specialist 2 ($81,250 × 1.25)$101,563

Additional Staffing (10% of Y1+Y2 cumulative)—

Year 3 · +2 Named Roles + 15% Additional + $300K v4 Addition · —

Ops Coordinator ($93,750 × 1.25)$117,188

Senior Billing Analyst ($81,250 × 1.25)$101,563

Additional Staffing (15% of Y2+Y3 cumulative)—

v4: +$300K operational budget addition (Regional Mgr · CMO · compliance scaling)+$300,000

Y4: —/yr · Y3 × 1.03 merit carry-forward

Y5: —/yr · Y4 × 1.03 merit carry-forward

MSO Operations · Fully Itemized · Y1 $171,500

Y2: $309,000 · Y3: $434,000 · Y4/Y5: $534,000 (v4: +$100K from Y3 for compliance, audit reserve & portfolio oversight scaling)

Office / Rent / Accounting ~$25,000

Accounting / bookkeeping (outsourced)$15,000

Virtual mailbox / registered agent$750

Home office stipends (5 officers)$4,500

Office supplies / shipping / printing$2,500

Collaboration tools (Zoom, Slack)$2,250

Sales & Marketing / Outreach $50,000

All marketing, digital, outreach, CRM, collateral$50,000

Technology / IT (MSO-level) $12,000

IT / cybersecurity managed service provider$12,000

Ongoing Legal ~$21,000

Healthcare attorney retainer$12,000

Employment law counsel$4,000

Malpractice tail / policy review$3,000

State provider license renewals$2,000

Ongoing Compliance ~$17,900

HIPAA compliance software — all sites$6,000

OIG exclusion screening (monthly, all staff)$1,800

Fractional compliance officer (4 hrs/mo)$9,600

FWA + HIPAA annual training licenses$500

Consulting & Contractual ~$45,600

RCM / billing consulting$12,000

Healthcare CPA$18,000

CLIA lab director consulting$9,600

Clinical quality / HEDIS consultant$6,000

Total MSO Operations Y1$171,500

Capital Structure · FIRARA · v2 Capital-Efficient

Raise · M1 (single raise)$4M Lease · $5M Own

Series A$0 — No Series A · Single raise only

Series B$0 — No Series B · Single raise only

Total raise—

Interest rate on debt6%

Per-clinic ops (revised)$157,218/yr · Lease model

MSO staff Y1 (hardcoded total)—

MSO staff Y2 (× 1.25 benefits · 10% add)—

MSO staff Y3 (× 1.25 benefits · 15% add · +$300K v4)—

MSO staff Y4 (Y3 × 1.03 merit carry-forward)—

MSO staff Y5 (Y4 × 1.03 merit carry-forward)—

CapEx · Per-Clinic Summary

Clinic 1 (Flagship) total CapEx—

Clinics 2–10 (Expansion) total CapEx—

Y1–Y3 portfolio total CapEx (Y4/Y5 = $0)—

Leasehold improvements$98,500 · 15-yr useful life

Clinical equipment total—

Vehicles (van + wrap)$38,500 · 5-yr useful life

GAAP depreciation (expansion)—

Model proxy (Clinic + Transport OpEx)$13,800/yr (understates by ~$12K)

Funded byRaise tranches (Seed / Series A / B)

i-STAT optionPurchase $18K or lease $450/mo

⚠ ADD_DAY1 Items Added (from Equipment Stack)

Vital Signs Station$1,100 CapEx · Day 1

Automated Urinalysis Reader$600 CapEx · Day 1

Biohazard & Sharps System$300 CapEx + $90/mo OpEx

Vision Screening Kit$50 CapEx · Day 1

Monofilament + Tuning Fork$50 CapEx · Day 1

Gooseneck LED Lights (×2)$230 CapEx · Day 1

MoCA License (cognitive screen)$138/yr OpEx (AWV required)

PHQ-9/GAD-7 · STEADI toolkit$0 — no cost, paper/Canvas-integrated

Own Buildings Toggle · Mortgage Model

Building price$286,000/clinic · $130/sqft × 2,200 sqft

Down payment (20%)$57,200/clinic

Loan amount (80%)$228,800/clinic

Closing costs (3% of loan)$6,864/clinic

Day 1 cash per clinic$64,064 (down + closing)

Mortgage terms7% · 20-yr amortization · commercial

Monthly payment$1,774/mo · $21,287/yr per clinic

Lease removed from OpEx−$30,000/clinic/yr

Mortgage payment added+$21,287/clinic/yr

Property tax + insurance + maintenance+$18,000/clinic/yr

Total own carrying costs$39,287/clinic/yr

Net OpEx change vs lease+$9,287/yr · equity-building premium

CapEx vs outright purchase$64K vs $286K/clinic · raise reduced

Portfolio mortgage debt$228,800 × 10 = $2,288,000

Depreciation39-yr MACRS on full $286K building value

OpEx treatment noteFull mortgage payment through OpEx (cash flow model). GAAP splits into principal + interest only. Confirm with CPA.

Active scenario—

ADD_DAY1 total new OpEx/clinic$1,218/yr ($101.50/mo)

PER_CLINIC_OPS updated to$157,218/yr

Tech Stack · Dynamic Scaling

Reference: Early Scale = 5 clinics · 5 providers · 300 CCM · 150 RPM = $18,370/mo

EHR (Athelas AIR / Athenahealth)$750/provider/mo

CCM platform (Chronic Care IQ)$6/enrolled member/mo

RPM devices (Tenovi)In COGS — not double-charged

AI documentation (Commure Ambient)$100/provider/mo

RCM (Commure RCM)4% of monthly net collections

Scheduling (Commure Agents)$0 — bundled with RCM

Patient SMS (Klara)$300/clinic/mo flat

Telehealth (Doxy.me + Zoom)$35/provider/mo + $200/clinic flat

Care transitions ADT (Bamboo Health)$1,500/mo flat portfolio fee

Connectivity (fiber + cellular)$400/clinic/mo

Fleet tracking (Samsara)$40/vehicle/mo · 1 van/clinic

HR/payroll/MDM (Rippling)$12/employee/mo + $35 base

Business email (Proton Business)$9/user/mo

Knowledge base (Notion)$13/user/mo

HIPAA compliance (Compliancy Group)$400/mo flat practice fee

Analytics (Looker Studio)$0 — free tier

Early Scale reference total~$18,370/mo (5 clinics)

Clinical Equipment · Introduction Schedule · Phase-Gated by Member Count

Equipment Schedule by Phase

Equipment introduction is clinically sequenced — each item is added only when the member panel is large enough to sustain utilization and the NP has had time to develop clinical confidence. Hardware costs reflect current market pricing. COGS treatments (lab cartridge 49%, vaccine 55%, RPM $55/enrolled/mo) are applied as modeled. Revenue codes are 2026 CMS MPFS GA Locality 03 rates × 0.85 NP factor, with HPSA 10% applied to E&M/AWV/TOC codes.

Equipment · Introduction Phase · CLIA Requirement · Hardware Cost · Revenue / COGS Treatment

Equipment	Description	Introduce	At Members	CLIA	Hardware Cost	Ongoing Cost	Revenue / COGS Treatment
Phase 1 · Day 1 (Mandatory at Launch)
Tenovi 4G Cellular RPM Hub	BP cuff + glucose + weight + pulse ox. No WiFi needed.	Day 1	0	None	$0 upfront	$28–$35/device/mo	Bills 99453 + 99454 + 99457 + 99458. Device cost ($55/enrolled/mo) deducted as COGS against RPM gross revenue. Net ~49% of gross at full enrollment.
Abbott i-STAT Alinity	BMP · HbA1c · INR · Hematocrit · Glucose · UA · Lactate (waived tests only)	Day 1	0	CoW $248	$15K–$22K or $450/mo lease	$8–$46/cartridge	Bills per CPT: BMP $46, HbA1c $14. Cartridge COGS deducted — 49% of gross per audit. Net lab margin: BMP $14/test, HbA1c $6/test.
12-Lead ECG Machine	Standard 12-lead for AWV cardiac screening and acute evaluation	Day 1	0	None	$800–$2,000	Minimal (paper/gel)	Bills 93000 (ECG interp) at ~$12/study. No significant COGS. Used at every AWV — ~750 ECGs/yr at full panel.
Rapid Tests (Standard)	Flu A/B, strep, COVID — basic panel	Day 1	0	CoW (included)	$0 (consumables only)	~$4–$8/test kit	Seasonal — Oct–Apr peak. Annual total unchanged but monthly cash flow spikes/troughs. COGS ~55% of gross per audit.
Phase 2 · Month 2 (Moderate CLIA — Apply Day 1, Approve M2–M3)
i-STAT Moderate Complexity Tests	BNP · Troponin I · Blood gas — requires Certificate of Compliance + lab director	Month 2–3	0	CoC $639 + lab director $800/mo	Same device as above	$38–$46/cartridge	Troponin has negative net margin ($36 bill − $38 COGS = −$2). Run clinical indication only. BNP $23 net margin. Zero revenue modeled until CoC in hand.
Phase 3 · Month 3 (95+ Members · Respiratory Season)
Cue Health Multiplex Device	Flu A/B + COVID + RSV in one panel. $112/multiplex panel — 3 CPT codes	Month 3	95	CoW (included)	$1,495	~$40/test cartridge	Recoups in 13 panels. Seasonal — Oct–Apr elevated volume. Annual total ~$15K at 1,000 members. Included in "Other" ancillary gross line.
Dario Health CGM	Continuous glucose — insulin-dependent DM members. Device via member's Part D.	Month 3	95	None	$0 (member's Part D)	RPM codes only	Clinic bills RPM monitoring codes (99454 + 99457) on CGM data. ~10% of panel = 100 enrolled at 1,000 members. Revenue folded into RPM (Testing) line.
Phase 4 · Month 6 (275+ Members · Clinical Confidence Established)
Butterfly iQ+ POCUS	Handheld ultrasound — DVT screening, cardiac, abdominal, pulmonary views	Month 6	275	None	$2,999	Gel ~$2/scan	Bills 76881 (DVT) ~$120, 93308 (limited echo) ~$85. NP competency: 25–50 proctored scans before independent billing. Ramp applied M6–M9: 25%→50%→75%→100% utilization per audit.
Portable Spirometer	Office spirometry for COPD/asthma management and AWV pulmonary screens	Month 6	275	None	$1,500–$3,000	Mouthpieces ~$1 each	Bills 94010 (spirometry) ~$22/test. ~15% of panel with COPD/asthma. ~$6,600/yr at full panel. Included in Sonogram/imaging ancillary line.
Wound Care Station	Basic wound care supplies — dressing changes, debridement, wound assessment	Month 6	275	None	$500–$1,000	Supplies ~$5–$15/visit	Bills 97597/97598 (debridement) + 97602 (wound care). COGS = supply cost per visit. Included in Procedures ancillary line.
Phase 5 · Month 9 (470+ Members · Panel Established)
ABI Doppler Probe	Ankle-brachial index screening for peripheral arterial disease. Standard for DM + HTN members.	Month 9	470	None	$800–$1,500	Gel ~$2/test	Bills 93922 (ABI limited) ~$45/study. ~30% of DM+HTN panel annually. COGS minimal (gel only $400/yr). Added to Sonogram ancillary line.
Joint Injection Supplies	Corticosteroid + syringe + prep for knee, shoulder, hip injections	Month 9	470	None	~$200 initial stock	~$15 COGS/injection	Bills 20610 (large joint) ~$65. COGS $15/injection ($8 steroid + $3 syringe + $4 supplies). Net ~$50/injection. 200 injections/yr = $10K net. Included in Procedures line. Audit added $3K/yr COGS.
CoaguChek Backup INR	Backup point-of-care INR for warfarin management when i-STAT INR strips unavailable	Month 9	470	CoW (included)	$500–$800	~$4/strip	Backup device — primary INR billed via i-STAT. Used for anticoagulation members between visits. Revenue minimal; operational continuity primary benefit.

Model Assumptions · Clinical & Financial

Validated Model Assumptions

PMPM Validation · 2026 Billing Rates

Validated Rate Components

Visit revenue (E&M + HPSA)Post-HPSA: ~$40–$50/visit steady state

Visit revenue · Year 1 blendedNew patient surge M1–M6 · higher blended rate

CCM mix used55% 99490 · 35% 99487 · 10% 99489

RPM rate~$47 PMPM (net of device COGS)

AWV + G2211 (+ HPSA)~$15–$16 PMPM post-HPSA

TOC (+ HPSA)~$9 PMPM post-HPSA adjustment

Terminal PMPM (base)—

M1 PMPM (base)—

Visit PMPM: why lower in steady stateNew patient codes zero once panel established

HPSA bonus applies toE&M · AWV · G2211 · TOC — 10% uplift

CMS localityGA Locality 03 · 2026 MPFS · CF $33.40

Financial Audit · COGS & Billing Corrections

All Corrections Applied to This Model

RPM device COGS$55/enrolled/mo deducted · CRITICAL

RPM annual COGS impact−$264,000/yr at 400 enrolled

Lab cartridge COGS49% of gross · −$98,400/yr

Troponin net margin−$2/test (run clinical indication only)

Vaccine COGS55% of gross · net margin only

CCM billing success82% monthly (15–20% fallout)

CCM fallout causesHospitalization · refusal · death · doc failure

RPM 16-day threshold success88% of enrolled per month

APCM G0556/G0557/G0558 (2025)All three codes included · 2026 rates

POCUS ramp appliedM6=25% · M7–8=50% · M9=75% · M10+=100%

Quest draw revenueMonths 1–2 = $0 · Apply from M3

Rapid tests seasonalCash flow varies; annual total unchanged

Claim denial write-off2.5% of total gross revenue

NP malpractice$4,500/NP/yr · added to per-clinic ops

CLIA QC + proficiency$3,700/yr · added to per-clinic ops

Float NP coverage$11,250/yr (15 days × $750/day)

Ramp Model · Spark 18-Month Schedule

Ramp Model Assumptions Applied

Ramp basis18-month conservative · community trust

CMS enrollment timeline60–75 days · first member Month 1

CCM consent rate at enrollment80% of eligible at first visit

RPM enrollment follows CCMRPM offered at second visit for CCM members

M8 single-clinic breakeven~405 members · $500K annual run rate

M12 status650 members · 2nd NP started · $1.58M run rate

M18 status950 members · Portfolio expansion ready

Coordinator hire triggerPT at M3 · FT at M6

2nd NP offer atMonth 9 · starts Month 12

FT admin hired atMonth 16 · upgrade from PT

Equipment investment (through M9)$26K–$42K one-time + $3.5–$5K/yr lab director

Equipment payback60–75 days at 400 enrolled members

PMPM buildup (current scenario)—

Scale factor appliedmin(ffs × pen, 1,000) ÷ 1,000

Ramp for portfolioEach clinic runs independent 18-mo clock

Equipment costs sourced from Spark Senior Health clinical model. COGS treatments: RPM $55/enrolled/mo (Tenovi), lab cartridges 49% of gross, vaccines 55% of gross. CMS billing rates: 2026 MPFS Georgia Locality 03 · CF $33.40. HPSA 10% bonus applied to E&M/AWV/TOC per CMS CR 14265 (eff. Jan 1 2026). Vaccine acquisition pricing from McKesson published rates vs 2026 CMS allowed amounts. Validate all independently before investor distribution.