Construct a Managed Medicaid P&L statement for three years $(2024-2026)$based on the assumptions below.

Membership: $15$K members

The value based terms are as follows:

$1.$ MLR Target: $70\%$

$2.$ Quality Bonus $$100$ PMPY based on preventive services such as

hypertension and type $2$ diabetes control in primary care settings

$3.$ Shared Savings: $50\%$ to a maximum of $$2$ Million, if MLR is reached

$4.$ Downside: None

The consultant estimates that the current average regional Medicaid expenditures are $$200$ PMPM$,$ growing at an average of $5\%$ per year. The state Medicaid funds the risk pool at $$190$ PMPM$,$ increasing at $3\%$ per year. An additional $$30$ PMPM is available to support the estimated $10\%$ of the population who face homelessness or mental health conditions.

Assume administrative expenses for Care Management, Utilization Management, Tech support, outreach etc to be $$10$PMPM

Suggestions: Make assumptions on delivery system performance on costs, quality and risk documentation. For example $$ will they improve total costs of care by $1\%$ each year, will they implement a documentation program that would improve risk

scores by $2\%$ per year over two years etc.

Apply these assumptions each year to the base P&L to develop forecasts of MSSP performance for each year.