In addition, we are in the final phase of contracting with three other prospects. I will provide a brief update on each prospect. One, we are completing a statement of work with a prominent value-based provider group that will be leveraging our Ontrak’s Outreach, Engage, and Access solutions for their patients. We’re particularly excited about the seamless connection we will be making between their primary care clinics and our care coaches, who will provide virtual support and who may also be on site based in the clinics. This initial engagement will cover their members in three major metropolitan markets. We anticipate that with successful outcomes, this engagement will lead to an additional opportunities for their 200,000 patients across 15 states.
Two, we are finalizing a proposal for a large health system’s Western Medicare Advantage Plan and expect to reach agreement later this quarter to serve members with our WholeHealth+ and Ontrak Engage solutions. We expect this new contract will go into effect in Q1 2024. With successful outcomes, we expect an opportunity to expand to additional members within Medicare, Advantage, and other lines of business. And three, we are working on final approvals of our Statement of Work from a major Northeastern health plan. In addition, the health plan is refreshing its data in order to finalize expectations around a pilot for their Medicaid, HARP, and commercial members in Q1 2024. With successful outcomes, we believe the plan’s 1 million members will be a future opportunity for the Ontrak WholeHealth+ program.
In addition, we are in discussions with our existing customers to expand our solutions to additional populations as well as new lines of business, and our pipeline continues to build momentum. We have 27 active prospects representing 20 million total lives. We are extremely grateful to our existing customers for the partnerships we have developed together, serving members in need of behavioral health support. And we welcome our new customers with great excitement as we build these relationships serving new populations across multiple business lines. And now, I’d like to turn the call over to our Chief Financial Officer, James Park.
James Park: Thanks, Mary Lou. During the third quarter, we recorded revenue of $3.7 million, a 31% year-over-year increase due primarily to a 21% increase in total average enrolled members during the third quarter of 2023, compared to the same period in 2022, and also represented a sequential increase of revenue of 23% from Q2 of 2023. At the beginning of the quarter, we had 1,889 enrolled members and ended with 2,297 at the end of the quarter for a simple average of 2,093. That equates to revenue of about $552 per health plan enrolled member per month for the quarter, an increase from $528 per health plan enrolled number per month in Q2 of 2023, and an increase from $515 per health plan enrolled member per month in Q3 of 2022.
Regarding our Q3 member metrics, we enrolled a total of 1,272 members during the quarter compared to 1,091 in Q2 this year, and 533 in Q3 of 2022. This is five consecutive quarters that we have been able to steadily increase our gross enrollment. Dividing Q3 gross enrollments by our outreach pool, we averaged — which averaged 10,180 for the quarter. It annualizes to a 50% enrollment rate, compared to 43% enrollment rate in Q2 of 2023 and 53% in Q3 of 2022. Our average monthly disenrollment rate was 11% in the current quarter, same as in Q2 of 2023, and slight increase from 8% in Q3 of 2022. Further, we graduated 187 enrollment numbers during the quarter. This equates to about 10% of the enrolled members in the program at the beginning of the quarter.
The impact of all this was a net enrollment increase of 408 members in the third quarter. Our gross margin for the third quarter was 72%, which remained consistent from 72.8% in Q2 of 2023, an increase from 49.5% in the third quarter of last year. The increase in our gross margin compared to prior year was primarily due to the continued operational efficiencies in our member-facing teams with the utilization of various AI and other systems and process improvements we discussed earlier and in prior quarters. Our coaching capacity has now improved by over 90% since last year when we began to implement these initiatives, all while continuing to provide the quality of care our members and customers expect. Turning to the balance sheet and cash flow.
Our cash flow from operations in the third quarter was negative $1.8 million, compared to negative $8.3 million in the third quarter of last year and negative $5.1 million in Q2 of 2023. This resulted in our average monthly cash burn to be around $1.3 million per month this year so far and $0.6 million per month for the current quarter. We believe our operational efficiency and increasing revenues have us approaching positive cash flow in the near future, with anticipated revenues from the process that Mary Lou mentioned. We ended the quarter with cash and cash equivalents of $3.2 million, down from $6.1 million at the end of last quarter. Including restricted cash, total cash was $9.2 million at the end of the quarter, down from $10.1 million at the end of last quarter.
