Cover Page
Cover Page - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Feb. 18, 2020 | Jun. 30, 2019 | |
Cover page. | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2019 | ||
Document Transition Report | false | ||
Entity File Number | 001-33071 | ||
Entity Registrant Name | EHEALTH, INC. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 56-2357876 | ||
Entity Address, Address Line One | 2625 AUGUSTINE DRIVE, SECOND FLOOR | ||
Entity Address, City or Town | SANTA CLARA | ||
Entity Address, State or Province | CA | ||
Entity Address, Postal Zip Code | 95054 | ||
City Area Code | 650 | ||
Local Phone Number | 584-2700 | ||
Title of 12(b) Security | Common Stock, par value $0.001 per share | ||
Trading Symbol | EHTH | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 1,400,000,000 | ||
Entity Common Stock, Shares Outstanding | 23,457,682 | ||
Documents Incorporated by Reference | Portions of the registrant’s Definitive Proxy Statement for the 2020 Annual Meeting of Stockholders, which is expected to be filed within 120 days after the Company’s fiscal year ended December 31, 2019 , are incorporated by reference into Part III of this Annual Report on Form 10-K to the extent stated herein. | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY | ||
Entity Central Index Key | 0001333493 | ||
Current Fiscal Year End Date | --12-31 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | ||
Current assets: | ||||
Cash and cash equivalents | $ 23,466 | [1] | $ 13,089 | |
Accounts receivable | 2,332 | [1] | 3,601 | |
Commissions receivable - current | 174,526 | [1] | 134,190 | |
Prepaid expenses and other current assets | 7,822 | [1] | 5,288 | |
Total current assets | 208,146 | [1] | 156,168 | |
Commissions receivable - non-current | 414,696 | [1] | 211,668 | |
Property and equipment, net | 10,518 | [1] | 7,684 | |
Operating lease right-of-use assets | [1] | 36,621 | ||
Restricted cash | 3,354 | [1] | 0 | |
Other assets | 18,004 | [1] | 11,276 | |
Intangible assets, net | 10,062 | [1] | 12,249 | |
Goodwill | 40,233 | [1] | 40,233 | |
Total assets | 741,634 | [1] | 439,278 | |
Current liabilities: | ||||
Accounts payable | 24,554 | [1] | 5,688 | |
Accrued compensation and benefits | 29,578 | [1] | 20,763 | |
Accrued marketing expenses | 12,041 | [1] | 11,013 | |
Earnout liability — current | 37,273 | [1] | 20,730 | |
Lease liabilities — current | [1] | 4,759 | ||
Deferred revenue | 2,570 | [1] | 876 | |
Other current liabilities | 2,210 | [1] | 1,549 | |
Total current liabilities | 112,985 | [1] | 60,619 | |
Debt | 0 | [1] | 5,000 | |
Earnout liability — non-current | 0 | [1] | 19,270 | |
Deferred income taxes — non-current | 64,130 | [1] | 47,901 | |
Lease liabilities — non-current | [1] | 34,305 | ||
Other non-current liabilities | 3,050 | [1] | 3,339 | |
Stockholders’ equity: | ||||
Preferred stock, par value $0.001 per share; 10,000 authorized; none issued and outstanding | 0 | [1] | 0 | |
Common stock, par value $0.001 per share; 100,000 authorized; 34,752 and 30,863 issued as of December 31, 2019 and 2018, respectively; 23,136 and 19,437 outstanding as of December 31, 2019 and 2018, respectively | 35 | [1] | 31 | |
Additional paid-in capital | 455,159 | [1] | 298,024 | |
Treasury stock, at cost: 11,616 and 11,426 shares as of December 31, 2019 and 2018, respectively | (199,998) | [1] | (199,998) | |
Retained earnings | 271,852 | [1] | 204,965 | |
Accumulated other comprehensive income | 116 | [1] | 127 | |
Total stockholders’ equity | 527,164 | [1] | 303,149 | |
Total liabilities and stockholders’ equity | $ 741,634 | [1] | $ 439,278 | |
[1] | Reflects the impact from the adoption of ASC 842 on January 1, 2019. See Note 11 – Leases for details. |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in usd per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Common stock, par value (in usd per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, shares issued (in shares) | 34,752,000 | 30,863,000 |
Common stock, shares outstanding (in shares) | 23,136,000 | 19,437,000 |
Treasury stock (in shares) | 11,616,000 | 11,426,000 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) shares in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Revenue | |||
Total revenue | $ 506,201,000 | $ 251,395,000 | $ 190,706,000 |
Operating costs and expenses | |||
Cost of revenue | 2,738,000 | 1,228,000 | 582,000 |
Marketing and advertising | 150,249,000 | 82,939,000 | 65,874,000 |
Customer care and enrollment | 134,304,000 | 70,547,000 | 59,183,000 |
Technology and content | 47,085,000 | 31,970,000 | 32,889,000 |
General and administrative | 64,150,000 | 45,828,000 | 39,969,000 |
Change in fair value of earnout liability | 24,079,000 | 12,300,000 | 0 |
Amortization of intangible assets | 2,187,000 | 2,091,000 | 1,040,000 |
Restructuring charges | 0 | 1,865,000 | 0 |
Acquisition costs | 0 | 76,000 | 621,000 |
Total operating costs and expenses | 424,792,000 | 248,844,000 | 200,158,000 |
Income (loss) from operations | 81,409,000 | 2,551,000 | (9,452,000) |
Other income, net | 2,090,000 | 755,000 | 1,182,000 |
Income (loss) before provision (benefit) for income taxes | 83,499,000 | 3,306,000 | (8,270,000) |
Provision (benefit) for income taxes | 16,612,000 | 3,065,000 | (33,696,000) |
Net income | $ 66,887,000 | $ 241,000 | $ 25,426,000 |
Net income (loss) per share: | |||
Basic (in usd per share) | $ 2.90 | $ 0.01 | $ 1.37 |
Diluted (in usd per share) | $ 2.73 | $ 0.01 | $ 1.33 |
Weighted-average number of shares used in per share amounts: | |||
Basic (in shares) | 23,075 | 19,294 | 18,512 |
Diluted (in shares) | 24,539 | 20,409 | 19,047 |
Comprehensive income: | |||
Foreign currency translation adjustment, net of taxes | $ (11,000) | $ (75,000) | $ 29,000 |
Comprehensive income | 66,876,000 | 166,000 | 25,455,000 |
Commission | |||
Revenue | |||
Total revenue | 466,676,000 | 227,211,000 | 176,883,000 |
Other | |||
Revenue | |||
Total revenue | $ 39,525,000 | $ 24,184,000 | $ 13,823,000 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Treasury Stock | Retained Earnings | Accumulated Other Comprehensive Income | |
Balance, shares (in shares) at Dec. 31, 2016 | 29,492 | (11,136) | |||||
Beginning Balance at Dec. 31, 2016 | $ 252,280 | $ 29 | $ 272,778 | $ (199,998) | $ 179,298 | $ 173 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Issuance of common stock in connection with exercise of common stock options (in shares) | 388 | ||||||
Issuance of common stock in connection with exercise of common stock options | 1,037 | $ 1 | 1,036 | ||||
Repurchase of shares to satisfy employee tax withholding obligations (in shares) | (102) | ||||||
Repurchase of shares to satisfy employee tax withholding obligations | (1,802) | (1,802) | |||||
Stock-based compensation expense | 9,694 | 9,694 | |||||
Foreign currency translation adjustment, net of taxes | 29 | 29 | |||||
Net income | 25,426 | 25,426 | |||||
Balance, shares (in shares) at Dec. 31, 2017 | 29,880 | (11,238) | |||||
Ending Balance at Dec. 31, 2017 | 286,664 | $ 30 | 281,706 | $ (199,998) | 204,724 | 202 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Issuance of common stock in connection with exercise of common stock options (in shares) | 688 | ||||||
Issuance of common stock in connection with exercise of common stock options | 2,688 | $ 1 | 2,687 | ||||
Repurchase of shares to satisfy employee tax withholding obligations (in shares) | (188) | ||||||
Repurchase of shares to satisfy employee tax withholding obligations | (4,504) | (4,504) | |||||
Stock-based compensation expense | 12,540 | 12,540 | |||||
Foreign currency translation adjustment, net of taxes | (75) | (75) | |||||
Net income | 241 | 241 | |||||
Stock issued for GMG acquisition (in shares) | 295 | ||||||
Settlement of earnout liability | 5,595 | 5,595 | |||||
Balance, shares (in shares) at Dec. 31, 2018 | 30,863 | (11,426) | |||||
Ending Balance at Dec. 31, 2018 | 303,149 | $ 31 | 298,024 | $ (199,998) | 204,965 | 127 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Issuance of common stock in connection with exercise of common stock options (in shares) | 834 | ||||||
Issuance of common stock in connection with exercise of common stock options | 5,535 | $ 1 | 5,534 | ||||
Repurchase of shares to satisfy employee tax withholding obligations (in shares) | (190) | ||||||
Repurchase of shares to satisfy employee tax withholding obligations | (14,281) | (14,281) | |||||
Stock-based compensation expense | 22,570 | 22,570 | |||||
Foreign currency translation adjustment, net of taxes | (11) | (11) | |||||
Net income | 66,887 | 66,887 | |||||
Stock issued for GMG acquisition (in shares) | 295 | ||||||
Settlement of earnout liability | 17,264 | 17,264 | |||||
Stock issued in equity offering (in shares) | 2,760 | 0 | |||||
Shares issued in equity offering | 126,051 | $ 3 | 126,048 | ||||
Balance, shares (in shares) at Dec. 31, 2019 | 34,752 | (11,616) | |||||
Ending Balance at Dec. 31, 2019 | $ 527,164 | [1] | $ 35 | $ 455,159 | $ (199,998) | $ 271,852 | $ 116 |
[1] | Reflects the impact from the adoption of ASC 842 on January 1, 2019. See Note 11 – Leases for details. |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Operating activities | |||
Net income | $ 66,887 | $ 241 | $ 25,426 |
Adjustments to reconcile net income to net cash used in operating activities: | |||
Depreciation and amortization | 2,983 | 2,479 | 2,837 |
Amortization of internally developed software | 3,821 | 2,201 | 1,464 |
Amortization of intangible assets | 2,187 | 2,091 | 1,040 |
Stock-based compensation expense | 22,570 | 12,540 | 9,694 |
Deferred income taxes | 16,197 | 2,812 | (30,341) |
Change in fair value of earnout liability | 24,079 | 12,300 | 0 |
Other non-cash items | (755) | 675 | (101) |
Changes in operating assets and liabilities: | |||
Accounts receivable | 1,270 | (2,127) | 473 |
Commissions receivable | (243,364) | (50,967) | (21,640) |
Prepaid expenses and other assets | (466) | 232 | (1,933) |
Accounts payable | 19,694 | 1,414 | (1,866) |
Accrued compensation and benefits | 8,814 | 5,133 | 4,578 |
Accrued marketing expenses | 1,028 | 6,320 | (3,365) |
Deferred revenue | 1,694 | 491 | (466) |
Accrued restructuring charges | 0 | 0 | 0 |
Accrued expenses and other liabilities | 1,869 | 935 | (1,341) |
Net cash used in operating activities | (71,492) | (3,230) | (15,541) |
Investing activities | |||
Capitalized internal-use software and website development costs | (10,231) | (6,294) | (3,210) |
Purchases of property and equipment and other assets | (6,641) | (4,534) | (1,868) |
Payments for security deposits | (72) | 0 | 0 |
Acquisition of business, net of cash acquired | 0 | (14,929) | 0 |
Cash used in investing activities | (16,944) | (25,757) | (5,078) |
Financing activities | |||
Proceeds from issuance of common stock, net of issuance costs | 126,051 | 0 | 0 |
Net proceeds from exercise of common stock options | 5,535 | 2,688 | 1,037 |
Repurchase of shares to satisfy employee tax withholding obligations | (14,281) | (4,504) | (1,802) |
Proceeds from line of credit | 0 | 5,000 | 0 |
Debt issuance costs | (517) | (1,221) | 0 |
Repayment of debt | (5,000) | 0 | 0 |
Acquisition-related contingent payments | (9,542) | 0 | 0 |
Principal payments in connection with leases | (105) | ||
Principal payments in connection with leases | (103) | (105) | |
Net cash provided by (used in) financing activities | 102,141 | 1,860 | (870) |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | 26 | (77) | 1 |
Net increase (decrease) in cash, cash equivalents and restricted cash | 13,731 | (27,204) | (21,488) |
Cash, cash equivalents and restricted cash at beginning of period | 13,089 | 40,293 | 61,781 |
Cash, cash equivalents and restricted cash at end of period | 26,820 | 13,089 | 40,293 |
Cash paid for interest | 42 | 44 | 20 |
Cash refunds from (paid for) income taxes, net | $ 741 | ||
Cash refunds from (paid for) income taxes, net | $ (139) | $ (219) |
Summary of Business and Signifi
Summary of Business and Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Summary of Business and Significant Accounting Policies | Summary of Business and Significant Accounting Policies Description of Business – eHealth, Inc. (the “Company,” “eHealth,” “we” or “us”) is a leading private health insurance exchange for individuals, families and small businesses in the United States. Through our website addresses ( www.eHealth.com , www.eHealthInsurance.com , www.eHealthMedicare.com, www.Medicare.com, www.PlanPrescriber.com and www.GoMedigap.com) , consumers can get quotes from leading health insurance carriers, compare plans side-by-side, and apply for and purchase Medicare-related, individual and family, small business and ancillary health insurance plans. We actively market the availability of Medicare-related insurance plans and offer Medicare plan comparison tools and educational materials for Medicare-related insurance plans, including Medicare Advantage, Medicare Supplement and Medicare Part D prescription drug plans. Our ecommerce technology also enables us to deliver consumers’ health insurance applications electronically to health insurance carriers. We are licensed to market and sell health insurance in all 50 states and the District of Columbia. Basis of Presentation – Our consolidated financial statements include the accounts of eHealth, Inc. and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. The consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP.”) Certain prior period amounts have been reclassified to conform with our current period presentation. Our Consolidated Balance Sheet as of December 31, 2019 reflects the impact from the adoption of ASC 842 on January 1, 2019. See Note 11 – Leases for details. Operating Segments – We report segment information based on how our chief executive officer, who is our chief operating decision maker (“CODM”), regularly reviews our operating results, allocates resources and makes decisions regarding our business operations. The performance measures of our segments include total revenue and profit (loss). Our business structure is comprised of two operating segments: • Medicare; and • Individual, Family and Small Business The Medicare segment consists primarily of commissions earned from our sale of Medicare-related health insurance plans, including Medicare Advantage, Medicare Supplement and Medicare Part D prescription drug plans, and to a lesser extent, ancillary products sold to our Medicare-eligible customers, including but not limited to, dental and vision insurance, as well as our advertising program that allows Medicare-related carriers to purchase advertising on a separate website developed, hosted and maintained by us and our delivery and sale to third parties of Medicare-related health insurance leads generated by our ecommerce platforms and our marketing activities. The Individual, Family and Small Business segment consists primarily of commissions earned from our sale of individual and family and small business health insurance plans and ancillary products sold to our non-Medicare-eligible customers, including but not limited to, dental, vision, life, short term disability and long term disability insurance. To a lesser extent, the Individual, Family and Small Business segment consists of amounts earned from our online sponsorship program that allows carriers to purchase advertising space in specific markets in a sponsorship area on our website, our licensing to third parties the use of our health insurance ecommerce technology and our delivery and sale to third parties of individual and family health insurance leads generated by our ecommerce platforms and our marketing activities. Marketing and advertising, customer care and enrollment, technology and content and general and administrative operating expenses that are directly attributable to a segment are reported within the applicable segment. Indirect marketing and advertising, customer care and enrollment and technology and content operating expenses are allocated to each segment based on usage. Other indirect general and administrative operating expenses are managed in a corporate shared services environment and, since they are not the responsibility of segment operating management, are not allocated to the two operating segments and are presented as a reconciling item to our consolidated financial results. Segment profit is calculated as total revenue for the applicable segment less direct and allocated marketing and advertising, customer care and enrollment, technology and content and general and administrative operating expenses, excluding stock-based compensation, depreciation and amortization expense and amortization of intangible assets. Use of Estimates – The preparation of consolidated financial statements and related disclosures in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the amounts reported and disclosed in the consolidated financial statements and accompanying notes. On an ongoing basis, we evaluate our estimates, including those related to, but not limited to, the useful lives of intangible assets, fair value of investments, recoverability of intangible assets, the commissions we expect to collect for each approved member cohort, valuation allowance for deferred income taxes, provision for income taxes and the assumptions used in determining stock-based compensation. We base our estimates of the carrying value of certain assets and liabilities on historical experience and on various other assumptions that we believe to be reasonable. Actual results may differ from these estimates. Cash Equivalents – We consider all investments with an original maturity of 90 days or less from the date of purchase to be cash equivalents. Cash and cash equivalents are stated at fair value. Property and Equipment – Property and equipment are stated at cost, less accumulated depreciation and amortization. Finance lease amortization expenses are included in depreciation expense in our Consolidated Statements of Comprehensive Income. Maintenance and minor replacements are expensed as incurred. Depreciation and amortization is computed using the straight-line method based on estimated useful lives as follows: Computer equipment and software 3 to 5 years Office equipment and furniture 5 years Leasehold improvements* 5 to 10 years _______ * Lesser of useful life or related lease term See Note 4 – Supplemental Financial Statement Information of the Notes to Consolidated Financial Statements for additional information regarding our property and equipment. Business Combinations – We allocate the fair value of the acquisition consideration transferred in exchange for our acquired businesses to the tangible assets, liabilities and intangible assets acquired based on their estimated fair values at the acquisition date. The excess of the fair value of acquisition consideration over the fair values of these identifiable assets and liabilities is recorded as goodwill. Acquisition-related costs are recognized separately from the business combination and are expensed as incurred. Goodwill and Intangible Assets – Goodwill represents the excess of the consideration paid over the estimated fair value of assets acquired and liabilities assumed in a business combination. In the event that we realign our reporting units, we allocate our goodwill to the new reporting units using the relative fair value approach. We test our goodwill for impairment on an annual basis in the fourth quarter of each year or whenever events or changes in circumstances indicate that the asset may be impaired. Factors that we consider in deciding when to perform an impairment test include significant negative industry or economic trends or significant changes or planned changes in our use of the intangible assets. Our goodwill is allocated among our two segments, (1) Medicare and (2) Individual, Family and Small Business. No goodwill impairment has been identified in any of the years presented in the accompanying Consolidated Statements of Comprehensive Income. Intangible assets are reviewed for impairment whenever events or changes in circumstances indicate a potential reduction in their fair values below their respective carrying amounts. Intangible assets with finite useful lives, which include purchased technology, pharmacy and customer relationships, trade names, and certain trademarks, are amortized over their estimated useful lives. Goodwill and intangible assets are considered non-financial assets and therefore, subsequent to their initial recognition are not revalued at fair value each reporting period unless an impairment charge is recognized. We must make subjective judgments in determining the independent cash flows that can be related to specific asset groupings. In addition, we must make subjective judgments regarding the remaining useful lives of assets with finite useful lives. When we determine that the useful life of an asset is shorter than we had originally estimated, we accelerate the rate of amortization over the assets’ new, remaining useful life. We evaluated the remaining useful lives of our intangible assets with finite lives and determined no material adjustments to the remaining lives were required. See Note 4 – Supplemental Financial Statement Information of the Notes to Consolidated Financial Statements for additional information regarding our intangible assets. Other Long-Lived Assets – We evaluate other long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the asset exceeds its fair value. Revenue Recognition – In May 2014, the Financial Accounting Standards Board ("FASB") issued ASU 2014-09, Revenue from Contracts with Customers (ASC 606) , requiring an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Effective January 1, 2018, we adopted the requirements of Accounting Standards ASC 606 using the full retrospective method, which permits adjusting prior periods as if ASC 606 had been in effect as of the beginning of the earliest period presented. We are compensated by the receipt of commission payments from health insurance carriers whose health insurance policies are purchased through our ecommerce platforms or our customer care centers. We may also receive commission bonuses based on our attaining predetermined target sales levels for Medicare, individual and family, small business and ancillary health insurance products, or other objectives, as determined by the health insurance carrier, which we recognize as commission revenue when we achieve the predetermined target sales levels or other objectives. In addition, we also generate revenue from non-commission revenue sources, which include online sponsorship and advertising, technology licensing and lead referrals. Payment of commissions typically commences within 60 days from the effective date. Payment terms for non-commission revenue are typically 30 days from the invoice date . We account for revenue under ASC 606 – Revenue from Contracts with Customers. The core principle of ASC 606 is to recognize revenue upon the transfer of promised goods or services to customers in an amount that reflects the consideration the entity expects to be entitled in exchange for those goods or services. Accordingly, we recognize revenue for our services in accordance with the following five steps outlined in ASC 606: • Identification of the contract, or contracts, with a customer. A contract with a customer exists when (i) we enter into an enforceable contract with a customer that defines each party’s rights regarding the goods or services to be transferred and identifies the payment terms related to these goods or services, (ii) the contract has commercial substance, and (iii) we determine that collection of substantially all consideration for goods or services that are transferred is probable based on the customer’s intent and ability to pay the promised consideration. • Identification of the performance obligations in the contract. Performance obligations promised in a contract are identified based on the goods or services that will be transferred to the customer that are both capable of being distinct, whereby the customer can benefit from the goods or service either on its own or together with other resources that are readily available from third parties or from us, and are distinct in the context of the contract, whereby the transfer of the goods or services is separately identifiable from other promises in the contract. • Determination of the transaction price. The transaction price is determined based on the consideration to which we will be entitled in exchange for transferring goods or services to the customer. • Allocation of the transaction price to the performance obligations in the contract. If the contract contains a single performance obligation, the entire transaction price is allocated to the single performance obligation. Contracts that contain multiple performance obligations require an allocation of the transaction price to each performance obligation based on a relative standalone selling price basis. • Recognition of revenue when, or as, we satisfy a performance obligation. We satisfy performance obligations either over time or at a point in time, as discussed in further detail below. Revenue is recognized at the time the related performance obligation is satisfied by transferring the promised good or service to the customer. Commission Revenue — Our commission revenue results from approval of an application from health insurance carriers, which we define as our customers. Our commission revenue is primarily comprised of commissions from health insurance carriers which is computed using the estimated constrained lifetime value of commission payments that we expect to receive. We typically enter into contractual agency relationships with health insurance carriers that are non-exclusive and terminable on short notice by either party for any reason. In addition, health insurance carriers often have the ability to terminate or amend our agreements unilaterally on short notice, including provisions in our agreements relating to the commission rates paid to us by the health insurance carriers. The amendment or termination of an agreement we have with a health insurance carrier may adversely impact the commissions we are paid on health insurance plans purchased from the carrier by means of our health insurance exchange services. For both Medicare Advantage and Medicare Part D prescription drug plans, we receive a fixed, annual commission payment from insurance carriers once the plan is approved by the carrier and either a fixed, monthly, or annual commission payment beginning with and subsequent to the second plan year. In the first plan year of a Medicare Advantage and Medicare Part D prescription drug plan, after the health insurance carrier approves the application but during the effective year of the plan, we are paid a fixed commission that is prorated for the number of months remaining in the calendar year. Additionally, if the plan is the first Medicare Advantage or Medicare Part D prescription drug plan issued to the member, we may receive a higher commission rate that covers a full twelve-month period, regardless of the month the plan was effective. We earn commission revenue for Medicare Advantage and Medicare Part D prescription drug plans for which we are the broker of record, typically until either the policy is cancelled or we otherwise do not remain the agent on the policy. For individual and family, Medicare Supplement, small business and ancillary plans, our commissions generally represent a flat amount per member per month or a percentage of the premium amount collected by the carrier during the period that a member maintains coverage under a plan. Premium-based commissions are reported to us after the premiums are collected by the carrier, generally on a monthly basis. We generally continue to receive the commission payment from the relevant insurance carrier until the health insurance plan is cancelled or we otherwise do not remain the agent on the policy. Since the adoption of ASC 606, we recognize revenue at the time of plan approval by applying the latest estimated constrained LTV for that product. We estimate commission revenue for each product by using a portfolio approach to a group of approved members by plan type and the effective month of the relevant plan, which we refer to as “cohorts”. We estimate the cash commissions we expect to collect for each approved member cohort by evaluating various factors, including but not limited to, commission rates, carrier mix, estimated average plan duration, the regulatory environment, and cancellations of insurance plans offered by health insurance carriers with which we have a relationship. On a quarterly basis, we recompute LTV at a cohort level for all outstanding cohorts, review and monitor changes in the data used to estimate LTV as well as the cash received for each cohort as compared to our original estimates. The fluctuations of cash received for each cohort and LTV can be significant and may or may not be indicative of the need to adjust LTVs for prior period cohorts. Management analyzes these fluctuations and, to the extent we see changes in our estimates of the cash commission collections that we believe are indicative of an increase or decrease to prior period LTVs, we will adjust LTV for the affected cohorts at the time such determination is made. Changes in LTV may result in an increase or a decrease to revenue and a corresponding increase or decrease to commissions receivable, accordingly. We refer the net commission revenue from members approved in prior periods as “adjustment revenue” and our revenue can fluctuate significantly from period to period as a result of adjustment revenue. For Medicare-related, individual and family and ancillary health insurance plans, our services are complete once a submitted application is approved by the relevant health insurance carrier. Accordingly, we recognize commission revenue based upon the total estimated lifetime commissions we expect to receive for selling the plan after the carrier approves an application, net of an estimated constraint. We refer to these as estimated and constrained LTVs for the plan. We provide annual services in selling and renewing small business health insurance plans; therefore, we recognize small business health insurance plan commission revenue at the time the plan is approved by the carrier, and when it renews each year thereafter, equal to the estimated commissions we expect to collect from the plan over the following twelve months. Our estimate of commission revenue for each product line is based on a number of assumptions, which include, but are not limited to, estimating conversion of an approved member to a paying member, forecasting average plan duration and forecasting the commission amounts likely to be received per member. These assumptions are based on our analysis of historical trends for the different cohorts and incorporate management’s judgment in interpreting those trends to apply the constraints discussed below. For our Medicare commission revenue, which represented 87% , 83% and 76% of our total commission revenue for the years ended December 31, 2019 , 2018 and 2017 , respectively, the estimated average plan duration used to calculate Medicare health insurance plan LTVs historically has been approximately 3 years for Medicare Advantage plans, approximately 5 years for Medicare Part D prescription drug plans, and approximately 5 years for Medicare Supplement plans. While the average plan duration has been approximately 3 years for Medicare Advantage plans, certain members may have a duration of up to 12 years . The estimated average plan duration used to calculate the LTV for major medical individual and family health insurance plans historically has been approximately 1.5 to 2 years . For short term health insurance plan LTVs, the estimated average plan duration historically has been less than six months. For all other ancillary health insurance plan LTVs, the estimated average plan duration has historically varied from 1 to 3 years . To the extent we make changes to the assumptions we use to calculate constrained LTVs, we recognize any material impact of the changes to commission revenue in the reporting period in which the change is made, including revisions of estimated lifetime commissions either below or in excess of previously estimated constrained LTV recognized as revenue. Other Revenue – Our sponsorship and advertising program allows carriers to purchase advertising space in specific markets in a sponsorship area on our website. In return, we are typically paid a monthly fee, which is recognized over the period that advertising is displayed, and often a performance fee based on metrics such as submitted health insurance applications, which is recognized when control has been transferred. We also offer Medicare advertising services, which include website development, hosting and maintenance. In these instances, we are typically paid a fixed, up-front fee, which we recognize as revenue as control is transferred ratably over the service period. Our commercial technology licensing business allows carriers the use of our ecommerce platform to offer their own health insurance policies on their websites and agents to utilize our technology to power their online quoting, content and application submission processes. Typically, we are paid a one-time implementation fee, which we recognize as control is transferred on a straight-line basis over the estimated term of the customer relationship (generally the initial term of the agreement), commencing once the technology is available for use by the third party, and a performance fee based on metrics such as submitted health insurance applications. The metrics used to calculate performance fees for both sponsorship and advertising and technology licensing are based on performance criteria that are either measured based on data tracked by us, or based on data tracked by the third party. In instances where the performance criteria data is tracked by us, we recognize revenue in the period of performance and when all other revenue recognition criteria has been met. In instances where the performance criteria data is tracked by the third party, we recognize revenue as control is transferred at amounts where reversal of such amounts is not likely to occur. Typically, this occurs through our receipt of a cash payment from the third party along with a detailed statement containing the data that is tracked by the third party. Deferred Revenue – Deferred revenue includes deferred technology licensing implementation fees and amounts billed to or collected from sponsorship or technology licensing customers in advance of our performing our service for such customers. It also includes the amount by which both unbilled and billed services provided under our technology licensing arrangements exceed the straight-line revenue recognized to date. Incremental Costs to Obtain a Contract — Our sales compensation plans, which are directed at converting leads into approved members, represent fulfillment costs and not costs to obtain a contract with a customer. Additionally, we reviewed compensation plans related to personnel responsible for identifying new health insurance carriers and entering into contracts with new health insurance carriers and concluded that no incremental costs are incurred to obtain such contracts. Book-of-Business Transfers – We entered into several agreements with a broker partner, whereby the partner transferred certain of its existing Medicare plan members to us as the broker of record on the underlying policies. The first of these book-of-business transfers occurred in November 2010 and the most recent in June 2012. Total consideration paid by us for these books-of-business was $13.9 million . The consideration we paid to the broker partner was based on the discounted commissions expected to be received over the remaining life of each transferred Medicare plan member. As we receive commission payments from health insurance carriers for these plan members, we record the margin earned to other income , net in the Consolidated Statements of Comprehensive Income. The margin earned and recorded to other income, net for these books-of-business for the years ended December 31, 2019 , 2018 and 2017 totaled $0.6 million , $0.8 million , and $0.9 million , respectively. Cost of Revenue – Included in cost of revenue are payments related to health insurance policies sold to members who were referred to our website by marketing partners with whom we have revenue-sharing arrangements. In order to enter into a revenue-sharing arrangement, marketing partners must be licensed to sell health insurance in the state where the policy is sold. Costs related to revenue-sharing arrangements are expensed as the related revenue is recognized. Marketing and Advertising Expenses – Marketing and advertising expenses consist primarily of member acquisition expenses associated with our direct, marketing partner and online advertising member acquisition channels, in addition to compensation and other expenses related to marketing, business development, partner management, public relations and carrier relations personnel who support our offerings. We recognize direct marketing expenses in our direct member acquisition channel in the period in which they are incurred. We recognize online marketing expenses associated with search advertising in the period in which the consumer clicks on the advertisement. Advertising costs incurred in the years ended December 31, 2019 , 2018 and 2017 totaled $122.6 million , $64.4 million , and $56.0 million , respectively. Our direct channel expenses primarily consist of costs for direct mail, email marketing and television and radio advertising. Advertising costs for our direct channel are expensed the first time the related advertising takes place. Our marketing partner channel expenses primarily consist of fees paid to marketing partners with which we have a relationship. Our online advertising channel expenses primarily consist of paid keyword search advertising on search engines and retargeting campaigns. Advertising costs for our marketing partner channel and our online advertising channel are expensed as incurred. Research and Development Expenses – Research and development expenses consist primarily of compensation and related expenses incurred for employees on our engineering and technical teams. Research and development costs, which totaled $8.1 million , $6.9 million and $7.6 million for the years ended December 31, 2019 , 2018 and 2017 , respectively, are included in technology and content expense in the accompanying Consolidated Statements of Comprehensive Income. Deferred Contract Costs – Deferred contract costs primarily represent direct costs related to professional services provided in connection with technology licensing arrangements that are accounted for as a single unit of accounting. The direct professional services costs are deferred up until the commencement of revenue recognition of the single unit and then recognized as cost of revenue ratably over the same period as the related revenue. Internal-Use Software and Website Development Costs – We capitalize costs of materials, consultants and compensation and benefits costs of employees who devote time to the development of internal-use software during the application development stage. Our judgment is required in determining the point at which various projects enter the phases at which costs may be capitalized, in assessing the ongoing value of the capitalized costs and in determining the estimated useful lives over which the costs are amortized, which is generally 3 years . For the years ended December 31, 2019 , 2018 and 2017 , we capitalized internal-use software and website development costs of $10.2 million , $6.3 million and $3.2 million respectively, and recorded amortization expense of $3.8 million , $2.2 million , and $1.5 million respectively. Stock-Based Compensation – We recognize stock-based compensation expense in the accompanying Consolidated Statements of Comprehensive Income based on the fair value of our stock-based awards over their respective vesting periods, which is generally 4 years . The estimated grant date fair value of our stock options is determined using the Black-Scholes-Merton pricing model and a single option award approach. The weighted-average expected term for stock options granted is calculated using historical option exercise behavior. The dividend yield is determined by dividing the expected per share dividend during the coming year by the grant date stock price. Through December 31, 2019 , we had not declared or paid any cash dividends, and we do not expect to pay any in the foreseeable future. We base the risk-free interest rate on the implied yield currently available on U.S. Treasury zero-coupon issues with a remaining term equal to the expected term of our stock options. Expected volatility is determined using a combination of the implied volatility of publicly traded options in our stock and historical volatility of our stock price. The estimated attainment of performance-based awards and related expense is based on the expectations of revenue and earnings target achievement. The estimated fair value of performance awards with market conditions is determined using the Monte-Carlo simulation model. The assumptions used in calculating the fair value of stock-based payment awards and expected attainment of performance-based awards represent our best estimates, but these estimates involve inherent uncertainties and the application of management judgment. We will continue to use judgment in evaluating the expected term and volatility related to our own stock-based awards on a prospective basis, and incorporating these factors into the model. Changes in key assumptions could significantly impact the valuation of such instruments. 401(k) Plan – In September 1998, our board of directors adopted a defined contribution retirement plan ("401(k) Plan"), which qualifies under Section 401(k) of the Internal Revenue Code of 1986. Participation in the 401(k) Plan is available to substantially all employees in the United States. Employees can contribute up to 25% of their salary, up to the federal maximum allowable limit, on a before-tax basis to the 401(k) Plan. Employee contributions are fully vested when contributed. Our contributions to the 401(k) Plan are discretionary and are expensed when incurred. We also match employee contributions to our 401(k) Plan at 25% of an employee’s contribution each pay period, up to a maximum of 3% of the employee’s salary during such pay period for the year ended December 31, 2019, compared to a maximum of 2% and 1% for the years ended December 31, 2018 and 2017 , respectively. Our matching contributions are expensed as incurred and vest one-third for each of the first three years of the recipient’s service. The recipient is fully vested in all 401(k) Plan matching contributions after three years of service. We recognized expense of $2.3 million , $1.0 million and $0.4 million for the years ended December 31, 2019 , 2018 and 2017 , respectively, related to 401(k) matching contributions. Income Taxes – We account for income taxes using the liability method. Deferred income taxes are determined based on the differences between the financial reporting and tax bases of assets and liabilities, using enacted statutory tax rates in effect for the year in which the differences are expected to reverse. We utilize a two-step approach for evaluating uncertain tax positions. Step one, Recognition , requires a company to determine if the weight of available evidence indicates that a tax position is more likely than not to be sustained upon audit, including resolution of related appeals or litigation processes, if any. Step two, Measurement , is based on the largest amount of benefit, which is more likely than not to be realized on ultimate settlement. We record interest and penalti |
Revenue
Revenue | 12 Months Ended |
Dec. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Revenue | Revenue Adoption of ASC 606 As discussed in Note 1 - Summary of Business and Significant Accounting Policies , the FASB issued ASU 2014-09 in 2014, which, as amended, created ASC 606. The core principle of ASC 606 is that an entity shall recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The standard also contains significant new disclosure requirements regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. We adopted ASC 606 effective January 1, 2018, on a full retrospective basis. We have applied the standard to all contracts. Upon adoption, our retained earnings balance increased by $174.7 million as of December 31, 2016. Revenue Recognition Based on Estimated Constrained LTV We recognize revenue for plans approved during the period by applying the latest estimated constrained LTV for that product. We recognize adjustment revenue for plans approved in prior periods when there is a change in estimate to expected cash collections as a result of sufficient evidence that demonstrates a trend that is different from the estimated constrained LTV at the time of approval. We recognize adjustment revenue when we do not believe there is a probable significant reversal. We assess the risk of significant revenue reversal based on statistical and qualitative analysis given historical information and current market conditions. For Medicare-related, individual and family and ancillary health insurance plans, we apply constraints to determine the amount of commission revenue to recognize per approved plan. The constraints are applied to help ensure that the total estimated lifetime commissions expected to be collected for an approved member’s plan are recognized as revenue only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the uncertainty associated with future commissions receivable from the plan is subsequently resolved. The judgments that can be significant in estimating LTVs are related to the constraint. To determine the constraints to be applied to LTV, we compare prior calculations of LTV to actual cash received and review the reasons for any differences. We then apply judgment in assessing whether the difference between historical cash collections and LTV is representative of differences that can be expected in future periods. We also analyze whether circumstances have changed and consider any known or potential modifications to the inputs into LTV in light of the factors that can impact the amount of cash expected to be collected in future periods including but not limited to commission rates, carrier mix, plan duration, changes in laws and regulations, and cancellations of insurance plans offered by health insurance carriers with which we have a relationship. We evaluate the appropriateness of our constraints on a quarterly basis, and we update the assumptions when we observe a sufficient level of evidence that would suggest that the long-term expectation underlying the assumptions has changed. We recorded adjustment revenue for plans approved in prior periods of $88.1 million , $10.8 million and $13.0 million , respectively, or $3.82 , $0.56 , $0.70 per basic share, or $3.59 , $0.53 , $0.68 per diluted shares, respectively, for the years ended December 31, 2019 , 2018 and 2017 . Commission revenue by segment is presented in the table below (in thousands): Years Ended December 31, 2019 2018 2017 Medicare Commission Revenue from Members Approved During the Period (1) $ 355,916 $ 192,382 $ 134,093 Net Commission Revenue from Members Approved in Prior Periods (2) 55,292 (124 ) 917 Total Medicare Segment Commission Revenue $ 411,208 $ 192,258 $ 135,010 Individual, Family and Small Business Commission Revenue from Members Approved During the Period (1) $ 22,614 $ 24,079 $ 29,767 Net Commission Revenue from Members Approved in Prior Periods (2) 32,854 10,874 12,106 Total Individual, Family and Small Business Segment Commission Revenue $ 55,468 $ 34,953 $ 41,873 ________ (1) These amounts include commission bonus revenue. (2) These amounts reflect our revised estimates of cash collections for certain members approved prior to the relevant reporting period that are recognized as adjustments to revenue within the relevant reporting period. These amounts include revenue associated with renewing small business health insurance members. Adjustment revenue includes reductions to revenue for certain prior periods cohorts of $3.1 million , $3.2 million and $0.0 million for the years ended December 31, 2019, 2018 and 2017, respectively. Since the adoption of ASC 606, we have evaluated changes in estimated cash collections and compare these to the initial estimates of LTV at the time of approval. We have historically recorded adjustment revenue in the period when the risk of significant reversal in not probable. We continue to enhance our LTV estimation models to improve the accuracy and to reduce the fluctuations of our LTV estimates. For Medicare Advantage, our principal product, the quarterly revisions to expected cash collections have generally exceeded the estimated constrained LTVs and revenue recognized at the time of approval. At the time of ASC 606 adoption, we had been selling Medicare Advantage plans for approximately 7 years with limited volumes until the enrollment season in the fourth quarter of 2015 and volumes have continued to increase. During the fourth quarter of 2019, with additional data on Medicare Advantage plans and the application of statistical tools we were able to enhance our Medicare Advantage LTV estimation model to increase the accuracy of LTV estimates with an emphasis on improving member attrition forecasting. The enhancements to the Medicare Advantage LTV estimation model provide greater statistical certainty on expected cash collections, particularly for earlier period cohorts. As we had sufficient additional information with respect to increases in LTVs and estimates of future cash collections related to earlier period cohorts, we concluded that it was probable that a significant reversal of cumulative revenue would not occur for certain prior period cohorts and, accordingly, recognized adjustment revenue related to these prior period cohorts in 2019. For the Medicare segment, we recognized adjustment revenue of $55.3 million for the year ended December 31, 2019, of which $50.8 million was recognized for Medicare Advantage plans during the fourth quarter of 2019. For the Individual, Family and Small Business segment, we recognized adjustment revenue of $32.9 million for the year ended December 31, 2019, in response to observing longer plan duration than initially anticipated at the time of enrollment for these plans. Disaggregation of Revenue – The table below depicts the disaggregation of revenue by product and is consistent with how we evaluate our financial performance (in thousands): Year Ended December 31, 2019 2018 2017 Medicare Medicare Advantage $ 339,810 $ 143,445 $ 107,567 Medicare Supplement 40,345 31,166 15,436 Medicare Part D 26,824 14,609 11,085 Total Medicare 406,979 189,220 134,088 Individual and Family (1) Non-Qualified Health Plans 17,559 6,470 10,024 Qualified Health Plans 6,866 5,789 7,055 Total Individual and Family 24,425 12,259 17,079 Ancillary Short-term 10,524 5,583 5,503 Dental 5,238 2,717 5,062 Vision 2,002 1,467 1,607 Other 3,985 4,941 3,877 Total Ancillary 21,749 14,708 16,049 Small Business 9,922 8,595 7,501 Commission Bonus 3,601 2,429 2,166 Total Commission Revenue 466,676 227,211 176,883 Other Revenue 39,525 24,184 13,823 Total Revenue $ 506,201 $ 251,395 $ 190,706 _______ (1) We define our individual and family plan offerings as major medical individual and family health insurance plans, which does not include Medicare-related, small business or ancillary plans. Individual and family health insurance plans include both qualified and non-qualified plans. Qualified health plans are individual and family health insurance plans that meet the requirements of the Affordable Care Act and are offered through the government-run health insurance exchange in the relevant jurisdiction. Non-qualified health plans are individual and family health insurance plans that meet the requirements of the Affordable Care Act and are not offered through the exchange in the relevant jurisdiction. Individuals that purchase non-qualified health plans cannot receive a subsidy in connection with the purchase of those plans. |
Acquisition
Acquisition | 12 Months Ended |
Dec. 31, 2019 | |
Business Combinations [Abstract] | |
Acquisition | Acquisition On January 22, 2018, we completed our acquisition of all outstanding membership interests of Wealth, Health and Life Advisors, LLC, more commonly known as GoMedigap, a technology-enabled provider of Medicare Supplement enrollment services. The acquisition consideration consisted of cash of $15.0 million , less $0.1 million of cash acquired, and 294,637 shares of our common stock. In addition, the members of GoMedigap are entitled to receive earnout payments ("Earnout Consideration") consisting of up to $20.0 million in cash and 589,275 shares of our common stock. The Earnout Consideration became payable, subject to the terms and conditions of the purchase agreement relating to the acquisition, upon the final determination of the achievement of certain milestones in 2018 and 2019. The GoMedigap acquisition was accounted for using the acquisition method of accounting under ASC 805, Business Combinations. The acquisition method of accounting requires, among other things, that assets acquired and liabilities assumed be recognized at their fair values as of the acquisition date. The major classes of assets and liabilities to which we have allocated the acquisition consideration were as follows (in thousands): Acquisition Consideration Cash paid $ 15,000 Fair value of equity awards issued to GoMedigap members (1) 5,595 Estimated fair value of earnout liability 27,700 $ 48,295 Allocation Cash and cash equivalents $ 71 Commission receivable - current 4,371 Prepaid expenses and other current assets 11 Commission receivable - non-current 11,103 Property and equipment, net 174 Accounts payable (110 ) Accrued compensation and benefits (132 ) Other current liabilities (130 ) Net tangible assets acquired 15,358 Intangible assets 6,800 Goodwill 26,137 Total intangible assets acquired 32,937 Total net assets acquired $ 48,295 _______ (1) The fair value of equity awards issued was determined based on the January 22, 2018 closing price of our common stock of $18.99 per share. Goodwill and Intangible Assets – Goodwill represents the excess of the purchase price of the acquired business over the acquisition date fair value of the net assets acquired. Goodwill is primarily attributable to the assembled workforce, new product development capabilities and anticipated synergies and economies of scale expected from the operations of the combined company. The goodwill was assigned to our Medicare segment. Goodwill is tested for impairment on an annual basis in the fourth quarter of each year or whenever events or changes in circumstances indicate that the asset may be impaired. Factors that we consider in deciding when to perform an impairment test include significant negative industry or economic trends or significant changes or planned changes in our use of the intangible assets. Goodwill will be deductible for tax purposes over 15 years . Earnout liability – The earnout liability represents the fair value of the Earnout Consideration payable and is adjusted to fair value at each reporting date until settled. Changes in fair value were recognized in income (loss) from operations. The first and second earnout liability payments were made in February 2019 and January 2020, respectively. See Note 5 – Fair Value Measurements for further discussion regarding the earnout liability. Fair Value Measurements – The assets acquired and liabilities assumed of GoMedigap have been recognized at fair value in accordance with ASC 820, Fair Value Measurement. ASC 820 defines fair value as the price that would be received to sell an asset or would be paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC 820 requires three levels of hierarchy, which prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy level assigned to each asset and liability is based on the assessment of the transparency and reliability of inputs used in the valuation of such items based on the lowest level of input that is significant to fair value measurement. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and lowest priority to unobservable inputs (Level 3 measurements). Assets acquired and liabilities assumed measured and reported at fair value are classified in one of the following categories based on inputs: Level 1 Unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 Unadjusted quoted prices in active markets for similar assets or liabilities; or unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active; or inputs other than quoted prices that are observable for the asset or liability. Level 3 Unobservable inputs for the asset or liability. The fair value of prepaid expenses and other current assets, property and equipment, net, accounts payable, accrued compensation and benefits and other current liabilities approximated their carrying value at the date of acquisition. The fair value of commissions receivable was determined using a discounted rate of interest, which is a Level 2 input. Intangible assets and the earnout liability were valued using Level 3 inputs. The fair values of the acquired technology were determined by using income and cost methods. Fair value of trade names were determined using the profit allocation method, which is based on the estimated royalties we are relieved from paying because we own the assets. The fair value of the Earnout Consideration payable was measured using probability-weighted analysis and is discounted using a rate that appropriately captures the risk associated with the obligation. Key assumptions included new enrollments and volatility for the years ended December 31, 2019 and 2018 , as well as eHealth’s simulated stock price at the time of payment. The Earnout Consideration payable was part of the acquisition consideration and was adjusted to fair value at each reporting date until settled. The fair value adjustments to the earnout liability during the year ended December 31, 2019 and 2018 were $24.1 and $12.3 million , respectively. Following are the details of the acquisition consideration allocated to the intangible assets acquired (in thousands): Technology $ 2,000 Trade names, trademarks and website addresses 4,800 Total intangible assets $ 6,800 We are amortizing the existing technology, trade names, trademarks, and website addresses using the straight-line method over an estimated life of 3 and 10 years , respectively. The estimated useful lives are based on the time periods during which the intangibles are expected to result in incremental cash flows. We incurred $0.1 million of acquisition-related costs during the year ended December 31, 2018, which were expensed as incurred. Prior to the acquisition date, GoMedigap recognized revenue and expenses on the cash basis of accounting. GoMedigap's historical books and records did not contain the information required to recognize revenue or prepare financial statements on a basis that would be comparable to us. Thus, the required pro-forma financial disclosures are not presented herein. GoMedigap generated revenue of $15.2 million |
Supplemental Financial Statemen
Supplemental Financial Statement Information | 12 Months Ended |
Dec. 31, 2019 | |
Balance Sheet Related Disclosures [Abstract] | |
Supplemental Financial Statement Information | Supplemental Financial Statement Information Cash, Cash Equivalents and Restricted Cash – As of December 31, 2019 and 2018 , our cash equivalents consisted of money market accounts that invested in U.S. government-sponsored enterprise bonds and discount notes, U.S. government treasury bills and notes and repurchase agreements collateralized by U.S. government obligations. As of December 31, 2019 and 2018 , our cash equivalents carried no unrealized gains or losses and we did not realize any significant gains or losses on sales of cash equivalents during the years ended December 31, 2019 and 2018 . As of December 31, 2019, we had $3.4 million restricted cash to collateralize letters of credit related to certain lease commitments. Our cash, cash equivalent and restricted cash balances are summarized as follows (in thousands): December 31, 2019 December 31, 2018 Cash $ 16,205 $ 12,766 Money market funds 7,261 323 Cash and cash equivalents $ 23,466 $ 13,089 Restricted cash 3,354 — Total cash, cash equivalents and restricted cash $ 26,820 $ 13,089 Concentration of Credit Risk – Our financial instruments that are exposed to concentrations of credit risk principally consist of cash, cash equivalents and total accounts receivable (which includes commissions receivable). We invest our cash and cash equivalents with major banks and financial institutions and, at times, such investments are in excess of federally insured limits. We also have deposits with major banks in China that are denominated in both U.S. dollars and Chinese Yuan Renminbi and are not insured by the U.S. federal government. We do not require collateral or other security for our total accounts receivable. As of December 31, 2019 , three customers represented 22% , 20% , and 20% , respectively, for a combined total of 62% of our $591.6 million total outstanding accounts receivable balance. As of December 31, 2018 , three customers represented 19% , 19% , and 19% , respectively, or a combined total of 57% , of our $349.5 million total outstanding accounts receivable balance. No other customers represented 10% or more of our total accounts receivable at either December 31, 2019 or 2018 . We believe the potential for collection issues with any of our customers was minimal as of December 31, 2019 . Accordingly, our estimate for uncollectible amounts as of December 31, 2019 was immaterial. Accounts Receivable – Our total accounts receivable are summarized as of the periods presented below (in thousands): December 31, 2019 December 31, 2018 Commissions receivable - current $ 174,526 $ 134,190 Commissions receivable - non-current 414,696 211,668 Accounts receivable 2,332 3,601 Total accounts receivable $ 591,554 $ 349,459 Commission Receivable – Our commission receivable activities are summarized as follows (in thousands): For the year ended December 31, 2019 2018 2017 Beginning balance $ 345,858 $ 279,417 $ 257,777 Commission revenue from members approved during the period (1) 378,530 216,461 163,860 Net commission revenue adjustments from members approved in prior period (2) 88,146 10,750 13,023 Cash receipts (223,312 ) (160,770 ) (155,243 ) Ending balance $ 589,222 $ 345,858 $ 279,417 ________ (1) These amounts include commission bonus revenue. (2) These amounts reflect our revised estimates of cash collections for certain members approved prior to the relevant reporting period that are recognized as adjustments to revenue within the relevant reporting period. These amounts include revenue associated with renewing small business health insurance members. The commissions receivable balance at the end of each year primarily relates to Medicare Advantage and Medicare Part D plans sold during the fourth quarter with effective dates in the following year. Prepaid Expenses and Other Current Assets – Our prepaid expenses and other current assets are summarized as of the periods presented below (in thousands): December 31, 2019 December 31, 2018 Prepaid maintenance contracts $ 3,853 $ 1,937 Equity issuance costs — 294 Prepaid insurance 918 161 Prepaid rent 96 324 Income tax receivable 584 1,108 Other current assets 2,371 1,464 Prepaid expenses and other current assets $ 7,822 $ 5,288 Property and Equipment – Our property and equipment are summarized as of the periods presented below (in thousands): December 31, 2019 December 31, 2018 Computer equipment and software $ 17,893 $ 17,246 Office equipment and furniture 4,995 3,319 Leasehold improvements 6,051 6,345 Property and equipment, gross 28,939 26,910 Less accumulated depreciation and amortization (18,421 ) (19,226 ) Property and equipment, net $ 10,518 $ 7,684 Depreciation and amortization expense related to property and equipment totaled $3.0 million , $2.5 million , and $2.8 million in the years ended December 31, 2019 , 2018 and 2017 , respectively. Other Assets – Other assets are summarized as of the periods presented below (in thousands): December 31, 2019 December 31, 2018 Capitalized software project costs $ 14,718 $ 8,308 Debt issuance costs - non-current 1,149 1,099 Security deposits 555 483 Deferred tax assets 264 232 Income tax receivable 456 913 Other 862 241 Other assets $ 18,004 $ 11,276 Intangible Assets – The carrying amounts, accumulated amortization, net carrying value and weighted average remaining life of our definite-lived amortizable intangible assets, as well as our indefinite-lived intangible trademarks, are presented in the tables below (dollars in thousands, useful life in years): December 31, 2019 December 31, 2018 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Weighted-average remaining useful life Gross Carrying Amount Accumulated Amortization Net Carrying Amount Weighted-average remaining useful life Technology $ 2,000 $ (1,278 ) $ 722 1.1 $ 2,000 $ (611 ) $ 1,389 2.1 Pharmacy and customer relationships 9,500 (9,183 ) 317 0.3 9,500 (8,234 ) 1,266 1.3 Trade names, trademarks and website addresses 5,700 (1,791 ) 3,909 8.0 5,700 (1,220 ) 4,480 8.9 Total intangible assets subject to amortization $ 17,200 $ (12,252 ) 4,948 $ 17,200 $ (10,065 ) $ 7,135 Indefinite-lived trademarks and domain names 5,114 Indefinite 5,114 Indefinite Intangible assets $ 10,062 $ 12,249 During the years ended December 31, 2019 , 2018 , and 2017 , amortization expense related to intangible assets totaled $2.2 million , $2.1 million , and $1.0 million , respectively. As of December 31, 2019 , our expected amortization expense in future periods were as follows (in thousands): Years Ending December 31, Technology Pharmacy and Customer Relationships Trade Names, Trademarks and Website Addresses Total 2020 $ 667 $ 317 $ 509 $ 1,493 2021 55 — 480 535 2022 — — 480 480 2023 — — 480 480 2024 — — 480 480 Thereafter — — 1,480 1,480 Total $ 722 $ 317 $ 3,909 $ 4,948 |
Fair Value Measurements
Fair Value Measurements | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements We define fair value as the price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques we use to measure fair value maximize the use of observable inputs and minimize the use of unobservable inputs. We classify the inputs used to measure fair value into the following hierarchy: Level 1 Unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 Unadjusted quoted prices in active markets for similar assets or liabilities; unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability. Level 3 Unobservable inputs for the asset or liability. The following table is a summary of financial assets measured at fair value on a recurring basis and their classification within the fair value hierarchy (in thousands): December 31, 2019 December 31, 2018 Carrying Value Level 1 Level 3 Total Carrying Value Level 1 Level 3 Total Assets Money market funds $ 7,261 $ 7,261 $ — $ 7,261 $ 323 $ 323 $ — $ 323 Liability Earnout liability - current $ 37,273 $ — $ 37,273 $ 37,273 $ 20,730 $ — $ 20,730 $ 20,730 Earnout liability - non-current — $ — 19,270 — $ 19,270 $ 19,270 Total liabilities measured and recorded at fair value $ 37,273 $ — $ 37,273 $ 37,273 $ 40,000 $ — $ 40,000 $ 40,000 Our cash equivalents were invested in money market funds and were classified as Level 1. We endeavor to utilize the best available information in measuring fair value. We used observable prices in active markets in determining the classification of our money market funds as Level 1. There were no transfers between the hierarchy levels during the years ended December 31, 2019 and 2018 . We measure the earnout liability using internally developed assumptions; therefore, it is classified as Level 3. The fair value of the earnout liability was measured using probability-weighted analysis and is discounted using a rate that appropriately captures the risk associated with the obligation. The fair value of the earnout liability as of December 31, 2019 was adjusted to the amount that we settled in January 2020. Key assumptions included new enrollments and volatility for the years ended December 31, 2019 and 2018 and our stock price at the time of payment. Our earnout liability activities are summarized as follows (in thousands): Balance as of December 31, 2017 $ — Recognition of earnout liability upon acquisition of GoMedigap on January 22, 2018 27,700 Change in fair value 12,300 Balance as of December 31, 2018 $ 40,000 Change in fair value 24,079 Settlements (26,806 ) Balance as of December 31, 2019 $ 37,273 In February 2019, we made the first earnout payment to GoMedigap consisting of $9.5 million in cash and 294,608 shares of our common stock with a value of $17.3 million . In January 2020, we made the second payment, which consisted of $8.8 million in cash and 294,608 shares of our common stock with a value of $28.5 million . |
Equity
Equity | 12 Months Ended |
Dec. 31, 2019 | |
Stockholders' Equity Note [Abstract] | |
Equity | Equity Our board of directors has the authority, without any further action by our stockholders, to issue up to 110.0 million shares, par value $0.001 per share, of which 10.0 million shares are designated as preferred stock. As of December 31, 2019 and 2018 , there were no shares of preferred stock outstanding. Common Stock – On all matters submitted to our stockholders for vote, our common stockholders are entitled to one vote per share, voting together as a single class, and do not have cumulative voting rights. Accordingly, the holders of a majority of the shares of common stock entitled to vote in any election of directors can elect all of the directors standing for election, if they so choose. Subject to preferences that may apply to any shares of preferred stock outstanding, the holders of common stock are entitled to share equally in any dividends, when and if declared by our board of directors. Upon the occurrence of a liquidation, dissolution or winding-up, the holders of common stock are entitled to share equally in all assets remaining after the payment of any liabilities and the liquidation preferences on any outstanding preferred stock. Holders of common stock have no preemptive or conversion rights or other subscription rights and there are no redemption or sinking funds provisions applicable to the common stock. Pursuant to the effective registration statement which was filed on December 17, 2018, and amended on January 22, 2019, we entered into an underwriting agreement to issue 2.4 million shares of common stock, which included the exercise in full of the underwriters’ option to purchase 0.4 million additional shares of common stock, at a price to the public of $48.50 per share in January 2019, for a total of 2.8 million shares issued in connection with the offering. Net proceeds from the offering were approximately $126.1 million after deducting underwriting discounts, commissions and estimated expenses of the offering. We intend to use the net proceeds of the offering for general corporate purposes, including working capital. Shares Reserved – We generally issue previously unissued common stock upon the exercise of stock options, the vesting of restricted stock units and upon granting of restricted common stock awards; however we may reissue previously acquired treasury shares to satisfy these future issuances. Shares of authorized but unissued common stock reserved for future issuance were as follows (in thousands): December 31, 2019 December 31, 2018 Stock options issued and outstanding 649 1,005 Restricted stock units issued and outstanding 2,201 1,869 Shares available for grant 2,197 512 Total shares reserved 5,047 3,386 Stock Plans – On June 12, 2014, upon approval at the Annual Meeting of Stockholders, we adopted the 2014 Equity Incentive Plan (the “2014 Plan”). The 2014 Plan replaced the 2006 Equity Incentive Plan and 4.5 million shares were authorized for issuance under the 2014 Plan. The 2014 Plan does not include an evergreen provision to automatically increase the number of shares available under it and increases in the number of shares authorized for issuance under the 2014 Plan require stockholder approval. Also, under the 2014 Plan the following shares are not recycled for future grant under the 2014 Plan: (i) shares used in connection with the exercise of an option and/or stock appreciation right to pay the exercise price or purchase price of such award or satisfy applicable tax withholding obligations; and (ii) the gross number of shares subject to stock appreciation rights that are exercised. Furthermore, the 2014 Plan included a provision that prohibits repricing of outstanding stock options or stock appreciation rights and formalized and updated procedures to qualify awards as “performance-based” compensation under Section 162(m) of the Internal Revenue Code in order to preserve full tax deductibility of such awards. We previously granted options to purchase shares of our common stock and restricted stock units under our 2006 Equity Incentive Plan and 2005 Stock Plan. The 2006 Equity Incentive Plan was terminated with respect to the grant of additional awards on June 12, 2014, upon adoption of our 2014 Plan. The 2005 Stock Plan was terminated with respect to the grant of additional awards upon the effectiveness of the 2006 Equity Incentive Plan. Our stock options granted under the 2014 Plan generally vest over four years at a rate of 25% after one year and 1/48th per month thereafter. Stock options granted under the 2014 Plan generally expire after seven years from the date of grant. On December 31, 2018, no shares were subject to repurchase. Our restricted stock unit awards granted under the 2014 Plan, 2006 Plan and 2005 Stock Plan generally vest over four years at a rate of 25% after one year and 25% annually thereafter. We have granted market-based restricted stock units to our executive officers and certain members of our senior management team. Each market-based stock unit represents a contingent right to receive certain shares of our common stock upon the attainment of certain stock prices over a four -year performance period. Once a stock price threshold is achieved, the portion of the award related to that threshold will vest on the one-year anniversary of the date of achievement, subject to the employee's continued service through each vesting date. Compensation expense related to these awards is recognized on an accelerated basis over the requisite service period. The following table summarizes activity under our 2014 Equity Incentive Plan (the “2014 Plan”) for the year ended December 31, 2019 (in thousands): Beginning balance (1) 512 Additional shares authorized 2,500 Restricted stock units granted (2) (970 ) Options granted (3) (19 ) Restricted stock units cancelled (4) 124 Options cancelled 50 Ending balance 2,197 _______ (1) Shares available for grant do not include treasury stock shares that could be granted if we determined to do so. (2) Includes grants of restricted stock units with service, performance-based or market-based vesting criteria. (3) Includes grants of stock options with service, performance-based or market-based vesting criteria. (4) Includes cancelled restricted stock units with service, performance-based or market-based vesting criteria. The following table summarizes stock option activity under the Stock Plans (in thousands, except weighted-average exercise price and weighted-average remaining contractual life data): Number of Stock Options (1) Weighted Average Exercise Price Weighted-Average Remaining Contractual Life (years) Aggregate Intrinsic Value (2) Outstanding as of December 31, 2018 1,005 $ 18.34 5.0 $ 20,226 Granted 19 $ 63.54 Exercised (319 ) $ 17.45 Cancelled (56 ) $ 24.71 Outstanding balance as of December 31, 2019 649 $ 19.57 4.4 $ 49,661 Vested and expected to vest at December 31, 2019 631 $ 19.32 4.3 $ 48,404 Exercisable at December 31, 2019 428 $ 16.67 3.9 $ 33,995 _______ (1) Includes certain stock options with service, performance-based or market-based vesting criteria. (2) The aggregate intrinsic value is calculated as the product between eHealth’s closing stock price as of December 31, 2019 and 2018 at the exercise price of in-the-money options as of those dates. The following table provides information pertaining to our stock options for the years presented below (in thousands, except weighted-average fair values): Year Ended December 31, 2019 2018 2017 Weighted average fair value of options granted $ 33.19 $ 12.78 $ 9.03 Total fair value of options vested $ 2,924 $ 2,263 $ 799 Intrinsic value of options exercised $ 19,890 $ 1,461 $ 430 The following table summarizes restricted stock unit activity under the Stock Plans (in thousands, except weighted-average grant date fair value and weighted-average remaining contractual life data): Number of Restricted Stock Units (1) Weighted-Average Grant Date Fair Value Weighted-Average Remaining Service Period Aggregate Intrinsic Value (2) Unvested as of December 31, 2018 1,869 $ 16.95 4.8 $ 71,816 Granted 970 $ 17.96 Vested (514 ) $ 17.01 Cancelled (124 ) $ 31.50 Unvested as of December 31, 2019 2,201 $ 39.08 7.2 $ 211,443 _______ (1) Includes certain restricted stock units with service, performance-based or market-based vesting criteria. (2) The aggregate intrinsic value is calculated as the difference of our closing stock price as of December 31, 2019 and 2018 multiplied by the number of restricted stock units outstanding as of December 31, 2019 and 2018 , respectively. Stock Repurchase Programs – We had no stock repurchase activity during the years ended December 31, 2019 , 2018 or 2017 . In addition to 10.7 million shares repurchased under our past repurchase programs as of December 31, 2019 , we had in treasury 1.0 million shares that were previously surrendered by employees to satisfy tax withholdings due in connection with the vesting of certain restricted stock units. As of December 31, 2019 and 2018 , we had a total of 11.6 million shares and 11.4 million , respectively, held in treasury. For accounting purposes, common stock repurchased under our stock repurchase programs is recorded based upon the settlement date of the applicable trade. Such repurchased shares are held in treasury and are presented using the cost method. Stock-Based Compensation Expense – The fair value of stock options granted to employees was estimated using the following weighted average assumptions for the years presented below: Year Ended December 31, 2019 2018 2017 Expected term 4.3 4.3 4.3 Expected volatility 65.3% 68.3% 69.8% Expected dividend yield —% —% —% Risk-free interest rate 2.1% 2.7% 1.8% The weighted-average fair value of the market-based options and restricted stock units was determined using the Monte Carlo simulation model using the following weighted average assumptions: Year Ended December 31, 2019 2018 2017 Expected term 1.4 1.6 1.6 Expected volatility 57.8% 69.8% 70.9% Expected dividend yield —% —% —% Risk-free interest rate 2.4% 2.5% 1.7% Weighted-average grant date fair value $58.16 $13.48 $9.42 The following table summarizes stock-based compensation expense recorded for the years presented below (in thousands): Year Ended December 31, 2019 2018 2017 Common stock options $ 2,215 $ 1,991 $ 1,863 Restricted stock units 20,355 10,549 7,831 Total stock-based compensation expense $ 22,570 $ 12,540 $ 9,694 The following table summarizes stock-based compensation expense by operating function for the years presented below (in thousands): Year Ended December 31, 2019 2018 2017 Marketing and advertising $ 4,230 $ 1,974 $ 1,033 Customer care and enrollment 1,451 816 418 Technology and content 3,611 1,675 1,410 General and administrative 13,278 7,824 6,833 Restructuring charges — 251 — Total stock-based compensation expense $ 22,570 $ 12,540 $ 9,694 As of December 31, 2019 , there was $2.7 million of total unamortized compensation cost, net of estimated forfeitures, related to stock options, expected to be recognized over a weighted average period of 2.2 years . As of December 31, 2019 , there was $65.5 million of total unamortized compensation cost, net of estimated forfeitures, related to restricted stock units, expected to be recognized over a weighted average period of 2.8 years . Accelerated Vesting During the year ended December 31, 2018, due to changes in our senior management, we accelerated the vesting dates of certain stock options and restricted stock units granted to two former employees. We recorded a $0.5 million incremental stock-based compensation expense in connection with this modification. |
Net Income Per Share
Net Income Per Share | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
Net Income Per Share | Net Income Per Share Basic net income per share is computed by dividing net income by the weighted-average number of common shares outstanding for the period. Diluted net income per share is computed by dividing the net income for the period by the weighted average number of common and common equivalent shares outstanding during the period. Diluted net income per share is computed giving effect to all potential dilutive common stock equivalent shares, including options and restricted stock units. The dilutive effect of outstanding awards is reflected in diluted net income per share by application of the treasury stock method. The following table sets forth the computation of basic and diluted net income per share (in thousands, except per share amounts): Year Ended December 31, 2019 2018 2017 Basic Net income $ 66,887 $ 241 $ 25,426 Shares used in per share calculation - basic 23,075 19,294 18,512 Net income per share – basic $ 2.90 $ 0.01 $ 1.37 Diluted Net income $ 66,887 $ 241 $ 25,426 Shares used in per share calculation - basic 23,075 19,294 18,512 Dilutive effect of common stock 1,464 1,115 535 Total common stock shares used in diluted share calculation 24,539 20,409 19,047 Net income per share – diluted $ 2.73 $ 0.01 $ 1.33 For each of the years ended December 31, 2019 , 2018 and 2017 , we had securities outstanding that could potentially dilute net income per share, but the shares from the assumed conversion or exercise of these securities were excluded in the computation of diluted net income per share as their effect would have been anti-dilutive. The number of outstanding anti-dilutive shares that were excluded from the computation of diluted net income per share consisted of the following (in thousands): Year Ended December 31, 2019 2018 2017 Common stock options 11 291 908 Restricted stock units 41 13 1,296 Total 52 304 2,204 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Contingencies From time to time, we receive inquiries from governmental bodies and also may be subject to various legal proceedings and claims arising in the ordinary course of business. We assess contingencies to determine the degree of probability and range of possible loss for potential accrual in our consolidated financial statements. An estimated loss contingency is accrued in the consolidated financial statements if it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. We accrued approximately $1.2 million as of December 31, 2019 for amounts we believe will be payable for certain current legal proceedings, including the matters discussed below. Legal proceedings or other contingencies could result in material costs, even if we ultimately prevail. Legal Proceedings The Gonzalez and Le'Vita Complaints – On April 6, 2018, a former employee, Lupita Gonzalez, filed a complaint against us in the Superior Court of the State of California for the County of Sacramento (the “Gonzalez Complaint”). The Gonzalez Complaint is brought under the California Private Attorney General Act (“PAGA”) on behalf of all current and former hourly-paid or non-exempt employees who work or have worked for us in California. The claim alleges that we violated wage and hour laws with respect to these non-exempt employees, including, among other things, the failure to comply with California law as to (i) the payment of overtime wages; (ii) the payment of minimum wages; (iii) providing compliant meal and rest periods, (iv) the payment of wages earned during employment and owed upon the termination of employment; (v) providing complete and accurate wage statements, (vi) keeping of accurate payroll records; and (vii) the proper reimbursement for necessary business-related expenses and costs. The Gonzalez Complaint seeks penalties and costs, expenses and attorneys’ fees. On July 1, 2019, two other current or former employees, Michael Le’Vias and Ramona Meadows, filed a related complaint against us and eHealth Ins. Serv. Co., in the Superior Court of the State of California for the County of Santa Clara (the “Le’Vias Complaint”). A substantial overlap exists between the facts and circumstances alleged in the Gonzalez Complaint and the Le’Vias Complaint. Specifically, the Le’Vias Complaint is also brought under PAGA on behalf of all current and former hourly-paid or non-exempt employees who work or have worked for us in California. The claim alleges that we violated wage and hour laws with respect to these non-exempt employees, including, among other things, the failure to comply with California law as to (i) the payment of overtime wages; (ii) the payment of minimum wages; (iii) providing compliant meal and rest periods, (iv) the payment of wages earned during employment and owed upon the termination of employment; (v) providing complete and accurate wage statements, (vi) keeping of accurate payroll records; and (vii) the proper reimbursement for necessary business-related expenses and costs. The Le’Vias Complaint seeks unpaid wages, penalties and costs, expenses and attorneys’ fees. The parties have agreed to resolve both the Le’Vias and Gonzalez Complaints, which settlement will require court approval. In the interim, the parties have stipulated to vacate or, in the alternative, stay proceedings, including all discovery , with the exception of any deadlines or proceedings necessary to effectuate the settlement. The parties are seeking a court order vacating or, in the alternative, continuing the April 13, 2020 trial date for the Gonzalez matter. Service and Licensing Obligations We have entered into service and licensing agreements with third party vendors to provide various services, including network access, equipment maintenance and software licensing. The terms of these services and licensing agreements are generally up to three years . As the benefits of these agreements are experienced uniformly over the applicable contractual periods, we record the related service and licensing expenses on a straight-line basis, although actual cash payment obligations under certain of these agreements fluctuate over the terms of the agreements. The following table presents a summary of our future minimum payments under non-cancellable operating lease agreements and contractual service and licensing obligations as of December 31, 2019 (in thousands): For the Years Ending December 31, Operating Lease Obligations Service and Licensing Obligations Total Obligations 2020 $ 7,040 $ 3,073 $ 10,113 2021 6,529 1,825 8,354 2022 5,266 692 5,958 2023 6,103 444 6,547 2024 5,909 229 6,138 Thereafter 21,983 — 21,983 Total $ 52,830 $ 6,263 $ 59,093 |
Segment and Geographic Informat
Segment and Geographic Information | 12 Months Ended |
Dec. 31, 2019 | |
Segment Reporting [Abstract] | |
Segment and Geographic Information | Segment and Geographic Information Operating Segments The results of our operating segments are summarized for the periods presented below (in thousands): Year Ended December 31, 2019 2018 2017 Revenue Medicare $ 446,961 $ 210,570 $ 142,448 Individual, Family and Small Business 59,240 40,825 48,258 Total revenue $ 506,201 $ 251,395 $ 190,706 Segment profit Medicare segment profit $ 155,234 $ 60,844 $ 22,137 Individual, Family and Small Business segment profit 23,368 5,803 9,573 Total segment profit 178,602 66,647 31,710 Corporate (45,374 ) (32,996 ) (26,970 ) Stock-based compensation expense (22,570 ) (12,289 ) (9,694 ) Depreciation and amortization (2,983 ) (2,479 ) (2,837 ) Change in fair value of earnout liability (24,079 ) (12,300 ) — Restructuring charge — (1,865 ) — Acquisition costs — (76 ) (621 ) Amortization of intangible assets (2,187 ) (2,091 ) (1,040 ) Other income (expense), net 2,090 755 $ 1,182 Income (loss) before provision (benefit) for income taxes $ 83,499 $ 3,306 $ (8,270 ) There are no internal revenue transactions between our operating segments. Our CODM does not separately evaluate assets by segment, and therefore assets by segment are not presented. Geographic Information Our long-lived assets consist primarily of property and equipment and internally-developed software. All of our intangible assets are located in the United States. Our long-lived assets are attributed to the geographic location in which they are located. Long-lived assets (excluding intangible assets and goodwill) by geographical area are summarized as follows (in thousands): December 31, 2019 December 31, 2018 United States $ 64,408 $ 18,228 China 471 499 Total $ 64,879 $ 18,727 Significant Customers Substantially all revenue for the years ended December 31, 2019 , 2018 and 2017 was generated from customers located in the United States. Carriers representing 10% or more of our total revenue are summarized as follows: Year Ended December 31, 2019 2018 2017 Humana 26 % 22 % 20 % UnitedHealthcare (1) 19 % 19 % 23 % Aetna (2) 17 % 14 % 10 % ____________ (1) UnitedHealthcare also includes other carriers owned by UnitedHealthcare. (2) Aetna includes other carriers owned by Aetna. |
Restructuring
Restructuring | 12 Months Ended |
Dec. 31, 2019 | |
Restructuring and Related Activities [Abstract] | |
Restructuring | Restructuring In February 2018, our Board of Directors approved a plan to close our sales call center in Massachusetts and to terminate the employment of other employees in certain other locations. As part of this plan, we eliminated approximately 110 full-time positions, representing approximately 10% of our workforce, primarily within customer care and enrollment, and to a lesser extent, in our marketing and advertising and general and administrative groups. We recognized $1.9 million in pre-tax restructuring charges, which included approximately $1.6 million for employee termination benefits and $0.3 million in non-cash accelerated stock-based compensation in the year ended December 31, 2018. The restructuring activities comprising the plan were completed in June 2018. The following table summarizes the total cash and non-cash restructuring charges recognized during the periods presented below (in thousands): December 31, 2018 Employee termination costs $ 1,605 Non-cash employee termination costs - stock-based compensation 251 Other restructuring related costs 9 Total restructuring charges $ 1,865 The following table summarizes the accrued restructuring charges activity during the periods presented below (in thousands): Year Ended December 31, 2018 Beginning balance Charges Payments Ending balance Employee termination costs $ — $ 1,605 $ (1,605 ) $ — Accrued restructuring charges - current $ — $ 1,605 $ (1,605 ) $ — There were no restructuring charges and payments during the year ended December 31, 2019 . Accrued restructuring charges balance remained zero as of December 31, 2019 . |
Leases
Leases | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Leases | Leases Adoption of ASC 842 On January 1, 2019, we adopted ASC 842 – Leases , using the optional modified retrospective transition method. We have operating and finance leases for our corporate offices and certain equipment. Our leases have remaining lease terms of 1 to 10 years . Our operating lease expense recognized under ASC 842 was $6.4 million for the year ended December 31, 2019 , and our cash outflows related to operating leases were $5.4 million for the year ended December 31, 2019 . As a result of adopting the ASC, on January 1, 2019, we recorded a right-of-use asset and lease liability of $23.3 million and $24.6 million , respectively. During 2019, we recorded an additional lease liability of $10.8 million related to newly leased office space in Indianapolis, Indiana, which is described further below, and $1.1 million and $0.8 million related to an expansion and lease extension, respectively, of our office space in Gold River, California. We recorded additional lease liabilities totaling $4.9 million related to amendments made to our Salt Lake City office lease agreement during 2019. During the year ended December 31, 2019 , we had non-cash investing activities of $40.6 million relating to right-of-use assets in the Consolidated Statements of Cash Flows. Supplemental information as of December 31, 2019 related to leases is as follows (in thousands): Operating lease right-of-use assets $ 36,621 Operating lease liabilities $ 39,064 Weighted-average remaining lease term of operating leases 7.6 years Weighted-average discount rate used to recognize operating lease right-of-use-assets* 5.9 % _______ * As our leases do not provide an implicit rate of interest, we use our incremental borrowing rate based on the information available at commencement date or remeasurement date in determining the present value of lease payments. As of December 31, 2019 , maturities of operating lease liabilities are as follows (in thousands): Year ending December 31, 2020 $ 7,040 2021 6,529 2022 5,266 2023 6,103 2024 5,909 Thereafter 21,983 Total lease payments 52,830 Less imputed interest (13,766 ) Total $ 39,064 Operating Lease Obligations We lease our operating facilities and certain of our equipment, furniture and fixtures under various operating leases, the latest of which expires in January 2030. Certain of these leases have free or escalating rent payment provisions. We recognize rent expense on our operating leases on a straight-line basis over the terms of the leases, although actual cash payment obligations under certain of these agreements fluctuate over the terms of the agreements. In June 2019 , we entered into a sublease agreement for 56,276 square feet and a lease agreement for 81,515 square feet as a sublessee and lessee, respectively, of office space in Indianapolis, Indiana. The sublease consists of two suites (Suite 200 and Suite 300). The lease term of Suite 300 commenced on June 3, 2019, and the lease term of Suite 200 commenced on July 1, 2019. The term of the sublease will terminate on October 31, 2022. The term of the lease, which will commence after the sublease, extends from November 1, 2022 to January 31, 2030, which, in addition to Suite 200 and Suite 300, includes an additional 25,239 square feet of office space in Suite 100. As of December 31, 2019 , future minimum payments related to the Indiana office space are expected to be $17.6 million over the remaining term of the lease, plus our proportionate share of certain operating expenses, insurance costs and taxes for each calendar year during the lease. The landlord also agreed to contribute up to $1.9 million toward the cost of leasehold improvements. In connection with the Indianapolis, Indiana lease agreement, we entered into a financial guarantee consisting of a standby letter of credit for $0.8 million . In April 2019 , we entered into an amendment to the lease agreement for our Gold River, California, office to expand our office space to a total of 63,206 square feet from 44,738 square feet. The lease term for the expanded office space commenced on May 1, 2019. The term of the expanded office space will terminate on September 30, 2021. As of December 31, 2019 , future minimum payments are expected to be $2.9 million over the remaining term of the lease plus our proportionate share of certain operating expenses, insurance costs and taxes for each calendar year during the lease. In addition, we have an option to extend the lease for one additional period of five years at the end of the term of the lease and will receive a one-time refurbishment allowance from the landlord if the option to renew is exercised. In March 2019 , we entered into an amendment to the lease agreement for our Salt Lake City, Utah, office to expand our office space to a total of 41,813 square feet from 28,915 square feet. The lease term for the expanded office space commenced on May 1, 2019. The term of the lease for the original and expanded office space was also extended to terminate on the last day of the month that is 84 months after the commencement date of the expanded space. As of December 31, 2019 , future minimum payments are expected to be $8.7 million over the remaining term of the lease plus our proportionate share of certain operating expenses, insurance costs and taxes for each calendar year during the lease. In April 2018 , we entered into a lease agreement to lease approximately 32,492 square feet of office space located in Santa Clara, California. We entered into this lease agreement as a result of the expiration of one of our leases in Mountain View, California on December 31, 2018. The term of the lease is approximately 10.3 years , commencing on October 1, 2018 and ending on an estimated date of February 28, 2029. In August 2019 , we entered into an amendment to the lease agreement for our Santa Clara, California, office to expand our office space to a total of 45,657 square feet from 32,492 square feet. In connection with this lease agreement, we entered into a financial guarantee consisting of a standby letter of credit for $0.3 million . As of December 31, 2019 , future minimum payments are expected to be $16.1 million over the remaining term of 9 years plus our proportionate share of certain operating expenses, insurance costs and taxes for each calendar year during the lease. In connection with the Santa Clara, California lease agreement, we entered into a financial guarantee consisting of a standby letter of credit for $1.5 million , which may be reduced in increments of 20% of the original amount thereof on the second, third, fourth and fifth anniversaries of the commencement date, and may be reduced by an additional 8% of the original amount on the sixth anniversary of the commencement date, subject to our compliance with the applicable conditions to such reductions set forth in the lease. In March 2018, we entered into an agreement to lease 26,878 square feet of office space in Austin, Texas. The term of this lease agreement is 90 months , commencing in September 2018 and ending in May 2026. As of December 31, 2019 , future minimum payments are expected to be $4.1 million over the remaining term of the lease plus our proportionate share of certain operating expenses, insurance costs and taxes for each calendar year during the lease. In connection with the Austin, Texas office lease agreement, we entered into a financial guarantee consisting of a standby letter of credit for $0.6 million , which may be reduced on the third and subsequent anniversaries of the commencement date, subject to our compliance with the applicable conditions to such reductions set forth in the lease. In March 2012, we entered into an agreement to lease 18,272 square feet of office space in Mountain View, California. In connection with this lease agreement, we entered into a financial guarantee consisting of a standby letter of credit for $0.1 million . As of December 31, 2019 , our future minimum payments are expected to be $2.8 million over the remaining term of 3.6 years . We entered into an agreement to sublease this office space to a third party, which commenced in late December 2018. We recorded $1.1 million sublease income during the year ended December 31, 2019. In March 2018, we renewed our agreement to lease approximately 1,413 square feet of office space in Washington, DC. The lease commenced in November 2018 and is for a term of 5.4 years . As of December 31, 2019 , future minimum payments are $0.3 million . Total rent expense under all operating leases was approximately $7.3 million , $5.3 million , and $4.6 million for the years ended December 31, 2019 , 2018 and 2017 , respectively. |
Debt
Debt | 12 Months Ended |
Dec. 31, 2019 | |
Debt Disclosure [Abstract] | |
Debt | Debt On September 17, 2018, we entered into a Credit Agreement with Royal Bank of Canada (“RBC”), as administrative agent and collateral agent (the “Credit Agreement”). The Credit Agreement provides for a $40.0 million secured asset-backed revolving credit facility with a $5.0 million letter of credit sub-facility. On December 20, 2019, we amended our revolving credit facility agreement with RBC (the “Amendment”) and increased the borrowing amount from $40.0 to $75.0 million . The maturity date has been extended to December 20, 2022. The borrowing base under the Credit Agreement is comprised of an amount equal to (a) the lesser of (i) eighty percent ( 80% ) of Eligible Commissions Receivables (as defined in the Credit Agreement) we actually collected by during the immediately preceding period of three months or (ii) eighty percent 80% ) of our Eligible Commission Receivables for the immediately succeeding period of three months, plus (b) fifty percent ( 50% ) of our Eligible Commission Receivables for the immediately succeeding period of six months (excluding the immediately succeeding period of three months), in each case subject to reserves established by RBC (the “Borrowing Base”). The proceeds of the loans under the Credit Agreement may be used for working capital and general corporate purposes. The Borrowers have the right to prepay the loans under the Credit Agreement in whole or in part at any time without penalty. Subject to availability under the Borrowing Base, amounts repaid may be reborrowed. Amounts not borrowed under the Credit Agreement will be subject to a commitment fee of 0.5% per annum on the daily unused portion of the credit facility, to be paid in arrears on the first business day of each calendar quarter. At the closing of the Credit Agreement, we paid a one-time facility fee of 1.75% of the total commitments of $40.0 million . We also paid a one-time closing fee of 0.5% of the new commitment of $75.0 million in connection with the Amendment. The Company is also obligated to pay other customary administration fees for a credit facility of this size and type. The availability under the credit facility was up to the lesser of $40.0 million or the Borrowing Base in the original credit agreement. The Amendment increased the availability up to the lesser of $75.0 million or the Borrowing Base, which may be reduced from time to time pursuant to the Credit Agreement. Financial covenants in the original Credit Agreement required that we maintain Excess Availability (as defined in the Credit Agreement) at or above $6.0 million at any time. The Amendment also changed the financial covenants to require us to maintain at least $6.0 million of Excess Availability at all times or, if greater, up to $11.3 million depending on our borrowing base as determined by eligible past and future commission receivables. In addition, the Amendment also included changes in the payment conditions to, among other things, require us to have at least $10.0 million of liquidity or, if greater, up to $18.8 million depending on our borrowing base as determined by eligible past and future commission receivables, in order for us to make certain permitted acquisitions, investments, distributions and payments of indebtedness. The Amendment also stated the seasonal amount thresholds used in connection with the cash dominion and field examination covenants in the Credit Agreement. We incurred $1.2 million of issuance costs in connection with the Credit Agreement, which were capitalized as part of Other assets on our Consolidated Balance Sheet as of December 31, 2018 and 2019. The Amendment did not change the interest rate. In connection with this Amendment, we incurred closing costs totaling $0.5 million , which was capitalized and recorded as Other assets on our Consolidated Balance Sheet as of December 31, 2019 . The remaining balance of unamortized issuance costs was $1.1 million as of December 31, 2019 . As of December 31, 2018, we had $5.0 million outstanding principal amount under our revolving credit facility, which was repaid in full in January 2019. As of December 31, 2019 , there were no outstanding amounts under this revolving credit facility and we were in compliance with all covenant requirements. |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The components of our income (loss) before provision (benefit) for income taxes were as follows (in thousands): Year Ended December 31, 2019 2018 2017 United States $ 82,391 $ 2,458 $ (9,242 ) Foreign 1,108 848 972 Income (loss) before provision (benefit) for income taxes $ 83,499 $ 3,306 $ (8,270 ) The federal and state income tax provision (benefit) is summarized as follows (in thousands): Year Ended December 31, 2019 2018 2017 Current: Federal $ — $ 5 $ (275 ) State 75 48 (1,433 ) Foreign 326 213 179 Total current 401 266 (1,529 ) Deferred: Federal 13,594 165 (28,161 ) State 2,635 2,648 (3,992 ) Foreign (18 ) (14 ) (14 ) Total deferred 16,211 2,799 (32,167 ) Provision (benefit) for income taxes $ 16,612 $ 3,065 $ (33,696 ) In 2019 , we had worldwide consolidated income before tax of $83.5 million , and tax expense of $16.6 million , with an annual effective tax rate of 19.9% . The effective tax rate of our provision (benefit) for income taxes differs from the federal statutory rate as follows: Year Ended December 31, 2019 2018 2017 Statutory rate 21.0 % 21.0 % 35.0 % State income taxes, net of federal benefit 2.6 (7.2 ) 31.7 Stock-based compensation shortfalls (windfalls), net (7.0 ) (29.4 ) 1.9 Non-deductible stock-based compensation 2.5 21.6 (9.7 ) Non-deductible lobbying expenses 1.0 15.2 (9.1 ) Research and development credits (0.9 ) (17.1 ) (1.5 ) Changes in valuation allowance — 72.8 — Tax reform - tax rate change — — 355.9 Foreign income tax and income inclusion 0.1 6.8 2.7 Non-deductible parking expense 0.2 3.1 — Other permanent differences 0.4 5.9 0.7 Effective tax rate 19.9 % 92.7 % 407.6 % Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes, together with operating losses and tax credit carryforwards. The tax effects of significant items comprising our deferred taxes as of December 31, 2019 and 2018 were as follows (in thousands): December 31, 2019 December 31, 2018 Deferred tax assets: Net operating losses $ 60,023 $ 22,181 Accruals and reserves 4,143 3,370 Operating lease liabilities 9,471 — Intangible assets 6,306 2,269 Tax credits 5,818 4,508 Stock-based compensation 2,835 2,388 Fixed assets 203 61 Other 187 250 Total deferred tax assets 88,986 35,027 Valuation allowance (2,407 ) (2,407 ) Total deferred tax assets net of valuation allowance 86,579 32,620 Deferred tax liabilities: Commissions receivable (141,566 ) (80,289 ) Right-of-use assets (8,879 ) — Total deferred tax liabilities $ (150,445 ) $ (80,289 ) Net deferred tax liabilities $ (63,866 ) $ (47,669 ) Assessing the realizability of our deferred tax assets is dependent upon several factors, including the likelihood and amount, if any, of future taxable income in relevant jurisdictions during the periods in which those temporary differences become deductible. We forecast taxable income by considering all available positive and negative evidence, including our history of operating income and losses and our financial plans and estimates that we use to manage the business. These assumptions require significant judgment about future taxable income. As a result, the amount of deferred tax assets considered realizable is subject to adjustment in future periods if estimates of future taxable income change. During the year ended December 31, 2018, a partial valuation allowance of $2.4 million was recorded against certain state net operating losses expected to expire unutilized. The valuation allowance was recorded as a result of increased uncertainty regarding our future taxable income and a lack of sources of other taxable income to realize those net operating losses. The changes of our valuation allowance is summarized as follows (in thousands): Deferred Tax Assets - Valuation Allowance Balance at beginning of year Provision for income taxes Balance at end of year Year Ended December 31, 2019 $ 2,407 $ — $ 2,407 Year Ended December 31, 2018 $ — $ 2,407 $ 2,407 Year Ended December 31, 2017 $ — $ — $ — We had net operating loss carryforwards as of December 31, 2019 of approximately $238.3 million and $168.1 million for federal income tax and state income tax purposes, respectively. Federal and state net operating loss carry forwards begin expiring in 2034 and 2021 , respectively. As of December 31, 2019 , we had tax credit carry forwards of approximately $5.2 million and $6.1 million for federal income tax and state income tax purposes, respectively. The federal tax credit carryforwards begin expiring in 2021. The state tax credits carry forward indefinitely. Utilization of the net operating loss carryforwards and credits may be subject to a substantial annual limitation due to ownership changes that may have occurred or that could occur in the future, as required by Section 382 of the Internal Revenue Code and similar state provisions. These ownership change limitations may limit the amount of net operating loss carryforwards and other tax attributes that can be utilized annually to offset future taxable income and tax, respectively. A reconciliation of the beginning and ending amount of our unrecognized tax benefits is as follows (in thousands): Unrecognized Tax Benefits Balance as of December 31, 2016 $ 5,253 Decrease based on tax positions related to the prior year (862 ) Lapse of statute of limitations (1,637 ) Additions based on tax positions related to the current year 342 Balance as of December 31, 2017 3,096 Increase based on tax positions related to the prior year 579 Lapse of statute of limitations (5 ) Additions based on tax positions related to the current year 70 Balance as of December 31, 2018 3,740 Additions based on tax positions related to the current year 969 Balance as of December 31, 2019 $ 4,709 As of December 31, 2019 , the total amount of gross unrecognized tax benefits was $4.7 million , of which $4.2 million , if recognized, would affect our effective tax rate. As of December 31, 2018 , the total amount of gross unrecognized tax benefits was $3.7 million , of which $3.3 million , if recognized, would affect our effective tax rate. We record interest and penalties related to unrecognized tax benefits in income tax expense. As of December 31, 2019 , the amount accrued for estimated interest related to uncertain tax positions was immaterial. We did not record an accrual for penalties. Included in the balance of income tax liabilities and accrued interest as of December 31, 2019 is an immaterial amount related to tax positions for which it is reasonably possible that the statute of limitations will expire in various jurisdictions and income tax exams will close within the next twelve months. |
Selected Quarterly Financial Da
Selected Quarterly Financial Data (Unaudited) | 12 Months Ended |
Dec. 31, 2019 | |
Selected Quarterly Financial Information [Abstract] | |
Selected Quarterly Financial Data (Unaudited) | Selected Quarterly Financial Data (Unaudited) Selected summarized quarterly financial information for 2019 and 2018 is as follows (in thousands, except per share amounts): For the Year Ended December 31, 2019 First Second Third Fourth Year Revenue $ 68,773 $ 65,767 $ 69,913 $ 301,748 $ 506,201 Income (loss) from operations (9,183 ) (12,311 ) (20,241 ) 123,144 81,409 Net income (loss) (5,159 ) (5,754 ) (11,024 ) 88,824 66,887 Net income (loss) per share: Basic $ (0.24 ) $ (0.25 ) $ (0.47 ) $ 3.74 $ 2.90 Diluted $ (0.24 ) $ (0.25 ) $ (0.47 ) $ 3.58 $ 2.73 For the Year Ended December 31, 2018 First Second Third Fourth Year Revenue $ 43,070 $ 32,657 $ 40,751 $ 134,917 $ 251,395 Income (loss) from operations (6,720 ) (16,920 ) (15,454 ) 41,645 2,551 Net income (loss) (4,845 ) (12,014 ) (8,972 ) 26,072 241 Net income (loss) per share: Basic $ (0.26 ) $ (0.63 ) $ (0.47 ) $ 1.32 $ 0.01 Diluted $ (0.26 ) $ (0.63 ) $ (0.47 ) $ 1.25 $ 0.01 _______ * See Note 2 – Revenue for details regarding the change in estimate in the fourth quarter of 2019. |
Summary of Business and Signi_2
Summary of Business and Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Description of Business | Description of Business – eHealth, Inc. (the “Company,” “eHealth,” “we” or “us”) is a leading private health insurance exchange for individuals, families and small businesses in the United States. Through our website addresses ( www.eHealth.com , www.eHealthInsurance.com , www.eHealthMedicare.com, www.Medicare.com, www.PlanPrescriber.com and www.GoMedigap.com) , consumers can get quotes from leading health insurance carriers, compare plans side-by-side, and apply for and purchase Medicare-related, individual and family, small business and ancillary health insurance plans. We actively market the availability of Medicare-related insurance plans and offer Medicare plan comparison tools and educational materials for Medicare-related insurance plans, including Medicare Advantage, Medicare Supplement and Medicare Part D prescription drug plans. Our ecommerce technology also enables us to deliver consumers’ health insurance applications electronically to health insurance carriers. We are licensed to market and sell health insurance in all 50 |
Basis of Presentation | Basis of Presentation – Our consolidated financial statements include the accounts of eHealth, Inc. and its wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. The consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP.”) Certain prior period amounts have been reclassified to conform with our current period presentation. Our Consolidated Balance Sheet as of December 31, 2019 reflects the impact from the adoption of ASC 842 on January 1, 2019. See Note 11 – Leases for details. |
Operating Segments | Operating Segments – We report segment information based on how our chief executive officer, who is our chief operating decision maker (“CODM”), regularly reviews our operating results, allocates resources and makes decisions regarding our business operations. The performance measures of our segments include total revenue and profit (loss). Our business structure is comprised of two operating segments: • Medicare; and • Individual, Family and Small Business The Medicare segment consists primarily of commissions earned from our sale of Medicare-related health insurance plans, including Medicare Advantage, Medicare Supplement and Medicare Part D prescription drug plans, and to a lesser extent, ancillary products sold to our Medicare-eligible customers, including but not limited to, dental and vision insurance, as well as our advertising program that allows Medicare-related carriers to purchase advertising on a separate website developed, hosted and maintained by us and our delivery and sale to third parties of Medicare-related health insurance leads generated by our ecommerce platforms and our marketing activities. The Individual, Family and Small Business segment consists primarily of commissions earned from our sale of individual and family and small business health insurance plans and ancillary products sold to our non-Medicare-eligible customers, including but not limited to, dental, vision, life, short term disability and long term disability insurance. To a lesser extent, the Individual, Family and Small Business segment consists of amounts earned from our online sponsorship program that allows carriers to purchase advertising space in specific markets in a sponsorship area on our website, our licensing to third parties the use of our health insurance ecommerce technology and our delivery and sale to third parties of individual and family health insurance leads generated by our ecommerce platforms and our marketing activities. Marketing and advertising, customer care and enrollment, technology and content and general and administrative operating expenses that are directly attributable to a segment are reported within the applicable segment. Indirect marketing and advertising, customer care and enrollment and technology and content operating expenses are allocated to each segment based on usage. Other indirect general and administrative operating expenses are managed in a corporate shared services environment and, since they are not the responsibility of segment operating management, are not allocated to the two operating segments and are presented as a reconciling item to our consolidated financial results. Segment profit is calculated as total revenue for the applicable segment less direct and allocated marketing and advertising, customer care and enrollment, technology and content and general and administrative operating expenses, excluding stock-based compensation, depreciation and amortization expense and amortization of intangible assets. |
Use of Estimates | Use of Estimates – The preparation of consolidated financial statements and related disclosures in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the amounts reported and disclosed in the consolidated financial statements and accompanying notes. On an ongoing basis, we evaluate our estimates, including those related to, but not limited to, the useful lives of intangible assets, fair value of investments, recoverability of intangible assets, the commissions we expect to collect for each approved member cohort, valuation allowance for deferred income taxes, provision for income taxes and the assumptions used in determining stock-based compensation. We base our estimates of the carrying value of certain assets and liabilities on historical experience and on various other assumptions that we believe to be reasonable. Actual results may differ from these estimates. |
Cash Equivalents | Cash Equivalents – We consider all investments with an original maturity of 90 days or less from the date of purchase to be cash equivalents. Cash and cash equivalents are stated at fair value. |
Property and Equipment | Property and Equipment – Property and equipment are stated at cost, less accumulated depreciation and amortization. Finance lease amortization expenses are included in depreciation expense in our Consolidated Statements of Comprehensive Income. Maintenance and minor replacements are expensed as incurred. Depreciation and amortization is computed using the straight-line method based on estimated useful lives as follows: Computer equipment and software 3 to 5 years Office equipment and furniture 5 years Leasehold improvements* 5 to 10 years _______ * Lesser of useful life or related lease term See Note 4 – Supplemental Financial Statement Information of the Notes to Consolidated Financial Statements for additional information regarding our property and equipment. |
Business Combinations | Business Combinations – We allocate the fair value of the acquisition consideration transferred in exchange for our acquired businesses to the tangible assets, liabilities and intangible assets acquired based on their estimated fair values at the acquisition date. The excess of the fair value of acquisition consideration over the fair values of these identifiable assets and liabilities is recorded as goodwill. Acquisition-related costs are recognized separately from the business combination and are expensed as incurred. |
Goodwill and Intangible Assets | Goodwill and Intangible Assets – Goodwill represents the excess of the consideration paid over the estimated fair value of assets acquired and liabilities assumed in a business combination. In the event that we realign our reporting units, we allocate our goodwill to the new reporting units using the relative fair value approach. We test our goodwill for impairment on an annual basis in the fourth quarter of each year or whenever events or changes in circumstances indicate that the asset may be impaired. Factors that we consider in deciding when to perform an impairment test include significant negative industry or economic trends or significant changes or planned changes in our use of the intangible assets. Our goodwill is allocated among our two segments, (1) Medicare and (2) Individual, Family and Small Business. No goodwill impairment has been identified in any of the years presented in the accompanying Consolidated Statements of Comprehensive Income. Intangible assets are reviewed for impairment whenever events or changes in circumstances indicate a potential reduction in their fair values below their respective carrying amounts. Intangible assets with finite useful lives, which include purchased technology, pharmacy and customer relationships, trade names, and certain trademarks, are amortized over their estimated useful lives. Goodwill and intangible assets are considered non-financial assets and therefore, subsequent to their initial recognition are not revalued at fair value each reporting period unless an impairment charge is recognized. We must make subjective judgments in determining the independent cash flows that can be related to specific asset groupings. In addition, we must make subjective judgments regarding the remaining useful lives of assets with finite useful lives. When we determine that the useful life of an asset is shorter than we had originally estimated, we accelerate the rate of amortization over the assets’ new, remaining useful life. We evaluated the remaining useful lives of our intangible assets with finite lives and determined no material adjustments to the remaining lives were required. See Note 4 – Supplemental Financial Statement Information of the Notes to Consolidated Financial Statements for additional information regarding our intangible assets. |
Other Long-Lived Assets | Other Long-Lived Assets – We evaluate other long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the asset exceeds its fair value. |
Revenue Recognition | Revenue Recognition – In May 2014, the Financial Accounting Standards Board ("FASB") issued ASU 2014-09, Revenue from Contracts with Customers (ASC 606) , requiring an entity to recognize revenue when it transfers promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Effective January 1, 2018, we adopted the requirements of Accounting Standards ASC 606 using the full retrospective method, which permits adjusting prior periods as if ASC 606 had been in effect as of the beginning of the earliest period presented. We are compensated by the receipt of commission payments from health insurance carriers whose health insurance policies are purchased through our ecommerce platforms or our customer care centers. We may also receive commission bonuses based on our attaining predetermined target sales levels for Medicare, individual and family, small business and ancillary health insurance products, or other objectives, as determined by the health insurance carrier, which we recognize as commission revenue when we achieve the predetermined target sales levels or other objectives. In addition, we also generate revenue from non-commission revenue sources, which include online sponsorship and advertising, technology licensing and lead referrals. Payment of commissions typically commences within 60 days from the effective date. Payment terms for non-commission revenue are typically 30 days from the invoice date . We account for revenue under ASC 606 – Revenue from Contracts with Customers. The core principle of ASC 606 is to recognize revenue upon the transfer of promised goods or services to customers in an amount that reflects the consideration the entity expects to be entitled in exchange for those goods or services. Accordingly, we recognize revenue for our services in accordance with the following five steps outlined in ASC 606: • Identification of the contract, or contracts, with a customer. A contract with a customer exists when (i) we enter into an enforceable contract with a customer that defines each party’s rights regarding the goods or services to be transferred and identifies the payment terms related to these goods or services, (ii) the contract has commercial substance, and (iii) we determine that collection of substantially all consideration for goods or services that are transferred is probable based on the customer’s intent and ability to pay the promised consideration. • Identification of the performance obligations in the contract. Performance obligations promised in a contract are identified based on the goods or services that will be transferred to the customer that are both capable of being distinct, whereby the customer can benefit from the goods or service either on its own or together with other resources that are readily available from third parties or from us, and are distinct in the context of the contract, whereby the transfer of the goods or services is separately identifiable from other promises in the contract. • Determination of the transaction price. The transaction price is determined based on the consideration to which we will be entitled in exchange for transferring goods or services to the customer. • Allocation of the transaction price to the performance obligations in the contract. If the contract contains a single performance obligation, the entire transaction price is allocated to the single performance obligation. Contracts that contain multiple performance obligations require an allocation of the transaction price to each performance obligation based on a relative standalone selling price basis. • Recognition of revenue when, or as, we satisfy a performance obligation. We satisfy performance obligations either over time or at a point in time, as discussed in further detail below. Revenue is recognized at the time the related performance obligation is satisfied by transferring the promised good or service to the customer. Commission Revenue — Our commission revenue results from approval of an application from health insurance carriers, which we define as our customers. Our commission revenue is primarily comprised of commissions from health insurance carriers which is computed using the estimated constrained lifetime value of commission payments that we expect to receive. We typically enter into contractual agency relationships with health insurance carriers that are non-exclusive and terminable on short notice by either party for any reason. In addition, health insurance carriers often have the ability to terminate or amend our agreements unilaterally on short notice, including provisions in our agreements relating to the commission rates paid to us by the health insurance carriers. The amendment or termination of an agreement we have with a health insurance carrier may adversely impact the commissions we are paid on health insurance plans purchased from the carrier by means of our health insurance exchange services. For both Medicare Advantage and Medicare Part D prescription drug plans, we receive a fixed, annual commission payment from insurance carriers once the plan is approved by the carrier and either a fixed, monthly, or annual commission payment beginning with and subsequent to the second plan year. In the first plan year of a Medicare Advantage and Medicare Part D prescription drug plan, after the health insurance carrier approves the application but during the effective year of the plan, we are paid a fixed commission that is prorated for the number of months remaining in the calendar year. Additionally, if the plan is the first Medicare Advantage or Medicare Part D prescription drug plan issued to the member, we may receive a higher commission rate that covers a full twelve-month period, regardless of the month the plan was effective. We earn commission revenue for Medicare Advantage and Medicare Part D prescription drug plans for which we are the broker of record, typically until either the policy is cancelled or we otherwise do not remain the agent on the policy. For individual and family, Medicare Supplement, small business and ancillary plans, our commissions generally represent a flat amount per member per month or a percentage of the premium amount collected by the carrier during the period that a member maintains coverage under a plan. Premium-based commissions are reported to us after the premiums are collected by the carrier, generally on a monthly basis. We generally continue to receive the commission payment from the relevant insurance carrier until the health insurance plan is cancelled or we otherwise do not remain the agent on the policy. Since the adoption of ASC 606, we recognize revenue at the time of plan approval by applying the latest estimated constrained LTV for that product. We estimate commission revenue for each product by using a portfolio approach to a group of approved members by plan type and the effective month of the relevant plan, which we refer to as “cohorts”. We estimate the cash commissions we expect to collect for each approved member cohort by evaluating various factors, including but not limited to, commission rates, carrier mix, estimated average plan duration, the regulatory environment, and cancellations of insurance plans offered by health insurance carriers with which we have a relationship. On a quarterly basis, we recompute LTV at a cohort level for all outstanding cohorts, review and monitor changes in the data used to estimate LTV as well as the cash received for each cohort as compared to our original estimates. The fluctuations of cash received for each cohort and LTV can be significant and may or may not be indicative of the need to adjust LTVs for prior period cohorts. Management analyzes these fluctuations and, to the extent we see changes in our estimates of the cash commission collections that we believe are indicative of an increase or decrease to prior period LTVs, we will adjust LTV for the affected cohorts at the time such determination is made. Changes in LTV may result in an increase or a decrease to revenue and a corresponding increase or decrease to commissions receivable, accordingly. We refer the net commission revenue from members approved in prior periods as “adjustment revenue” and our revenue can fluctuate significantly from period to period as a result of adjustment revenue. For Medicare-related, individual and family and ancillary health insurance plans, our services are complete once a submitted application is approved by the relevant health insurance carrier. Accordingly, we recognize commission revenue based upon the total estimated lifetime commissions we expect to receive for selling the plan after the carrier approves an application, net of an estimated constraint. We refer to these as estimated and constrained LTVs for the plan. We provide annual services in selling and renewing small business health insurance plans; therefore, we recognize small business health insurance plan commission revenue at the time the plan is approved by the carrier, and when it renews each year thereafter, equal to the estimated commissions we expect to collect from the plan over the following twelve months. Our estimate of commission revenue for each product line is based on a number of assumptions, which include, but are not limited to, estimating conversion of an approved member to a paying member, forecasting average plan duration and forecasting the commission amounts likely to be received per member. These assumptions are based on our analysis of historical trends for the different cohorts and incorporate management’s judgment in interpreting those trends to apply the constraints discussed below. For our Medicare commission revenue, which represented 87% , 83% and 76% of our total commission revenue for the years ended December 31, 2019 , 2018 and 2017 , respectively, the estimated average plan duration used to calculate Medicare health insurance plan LTVs historically has been approximately 3 years for Medicare Advantage plans, approximately 5 years for Medicare Part D prescription drug plans, and approximately 5 years for Medicare Supplement plans. While the average plan duration has been approximately 3 years for Medicare Advantage plans, certain members may have a duration of up to 12 years . The estimated average plan duration used to calculate the LTV for major medical individual and family health insurance plans historically has been approximately 1.5 to 2 years . For short term health insurance plan LTVs, the estimated average plan duration historically has been less than six months. For all other ancillary health insurance plan LTVs, the estimated average plan duration has historically varied from 1 to 3 years . To the extent we make changes to the assumptions we use to calculate constrained LTVs, we recognize any material impact of the changes to commission revenue in the reporting period in which the change is made, including revisions of estimated lifetime commissions either below or in excess of previously estimated constrained LTV recognized as revenue. Other Revenue – Our sponsorship and advertising program allows carriers to purchase advertising space in specific markets in a sponsorship area on our website. In return, we are typically paid a monthly fee, which is recognized over the period that advertising is displayed, and often a performance fee based on metrics such as submitted health insurance applications, which is recognized when control has been transferred. We also offer Medicare advertising services, which include website development, hosting and maintenance. In these instances, we are typically paid a fixed, up-front fee, which we recognize as revenue as control is transferred ratably over the service period. Our commercial technology licensing business allows carriers the use of our ecommerce platform to offer their own health insurance policies on their websites and agents to utilize our technology to power their online quoting, content and application submission processes. Typically, we are paid a one-time implementation fee, which we recognize as control is transferred on a straight-line basis over the estimated term of the customer relationship (generally the initial term of the agreement), commencing once the technology is available for use by the third party, and a performance fee based on metrics such as submitted health insurance applications. The metrics used to calculate performance fees for both sponsorship and advertising and technology licensing are based on performance criteria that are either measured based on data tracked by us, or based on data tracked by the third party. In instances where the performance criteria data is tracked by us, we recognize revenue in the period of performance and when all other revenue recognition criteria has been met. In instances where the performance criteria data is tracked by the third party, we recognize revenue as control is transferred at amounts where reversal of such amounts is not likely to occur. Typically, this occurs through our receipt of a cash payment from the third party along with a detailed statement containing the data that is tracked by the third party. Deferred Revenue – Deferred revenue includes deferred technology licensing implementation fees and amounts billed to or collected from sponsorship or technology licensing customers in advance of our performing our service for such customers. It also includes the amount by which both unbilled and billed services provided under our technology licensing arrangements exceed the straight-line revenue recognized to date. Incremental Costs to Obtain a Contract — Our sales compensation plans, which are directed at converting leads into approved members, represent fulfillment costs and not costs to obtain a contract with a customer. Additionally, we reviewed compensation plans related to personnel responsible for identifying new health insurance carriers and entering into contracts with new health insurance carriers and concluded that no incremental costs are incurred to obtain such contracts. |
Book-of-Business Transfers | Book-of-Business Transfers – We entered into several agreements with a broker partner, whereby the partner transferred certain of its existing Medicare plan members to us as the broker of record on the underlying policies. The first of these book-of-business transfers occurred in November 2010 and the most recent in June 2012. Total consideration paid by us for these books-of-business was $13.9 million |
Cost of Revenue | Cost of Revenue – Included in cost of revenue are payments related to health insurance policies sold to members who were referred to our website by marketing partners with whom we have revenue-sharing arrangements. In order to enter into a revenue-sharing arrangement, marketing partners must be licensed to sell health insurance in the state where the policy is sold. Costs related to revenue-sharing arrangements are expensed as the related revenue is recognized. |
Marketing and Advertising Expenses | Marketing and Advertising Expenses – Marketing and advertising expenses consist primarily of member acquisition expenses associated with our direct, marketing partner and online advertising member acquisition channels, in addition to compensation and other expenses related to marketing, business development, partner management, public relations and carrier relations personnel who support our offerings. We recognize direct marketing expenses in our direct member acquisition channel in the period in which they are incurred. We recognize online marketing expenses associated with search advertising in the period in which the consumer clicks on the advertisement. Advertising costs incurred in the years ended December 31, 2019 , 2018 and 2017 totaled $122.6 million , $64.4 million , and $56.0 million , respectively. Our direct channel expenses primarily consist of costs for direct mail, email marketing and television and radio advertising. Advertising costs for our direct channel are expensed the first time the related advertising takes place. Our marketing partner channel expenses primarily consist of fees paid to marketing partners with which we have a relationship. Our online advertising channel expenses primarily consist of paid keyword search advertising on search engines and retargeting campaigns. Advertising costs for our marketing partner channel and our online advertising channel are expensed as incurred. |
Research and Development Expenses | Research and Development Expenses – |
Deferred Contract Costs | Deferred Contract Costs – Deferred contract costs primarily represent direct costs related to professional services provided in connection with technology licensing arrangements that are accounted for as a single unit of accounting. The direct professional services costs are deferred up until the commencement of revenue recognition of the single unit and then recognized as cost of revenue ratably over the same period as the related revenue. |
Internal-Use Software and Website Development Costs | Internal-Use Software and Website Development Costs – We capitalize costs of materials, consultants and compensation and benefits costs of employees who devote time to the development of internal-use software during the application development stage. Our judgment is required in determining the point at which various projects enter the phases at which costs may be capitalized, in assessing the ongoing value of the capitalized costs and in determining the estimated useful lives over which the costs are amortized, which is generally 3 years |
Stock-Based Compensation | Stock-Based Compensation – We recognize stock-based compensation expense in the accompanying Consolidated Statements of Comprehensive Income based on the fair value of our stock-based awards over their respective vesting periods, which is generally 4 years . The estimated grant date fair value of our stock options is determined using the Black-Scholes-Merton pricing model and a single option award approach. The weighted-average expected term for stock options granted is calculated using historical option exercise behavior. The dividend yield is determined by dividing the expected per share dividend during the coming year by the grant date stock price. Through December 31, 2019 , we had not declared or paid any cash dividends, and we do not expect to pay any in the foreseeable future. We base the risk-free interest rate on the implied yield currently available on U.S. Treasury zero-coupon issues with a remaining term equal to the expected term of our stock options. Expected volatility is determined using a combination of the implied volatility of publicly traded options in our stock and historical volatility of our stock price. The estimated attainment of performance-based awards and related expense is based on the expectations of revenue and earnings target achievement. The estimated fair value of performance awards with market conditions is determined using the Monte-Carlo simulation model. The assumptions used in calculating the fair value of stock-based payment awards and expected attainment of performance-based awards represent our best estimates, but these estimates involve inherent uncertainties and the application of management judgment. We will continue to use judgment in evaluating the expected term and volatility related to our own stock-based awards on a prospective basis, and incorporating these factors into the model. Changes in key assumptions could significantly impact the valuation of such instruments. |
401(k) Plan | 401(k) Plan – In September 1998, our board of directors adopted a defined contribution retirement plan ("401(k) Plan"), which qualifies under Section 401(k) of the Internal Revenue Code of 1986. Participation in the 401(k) Plan is available to substantially all employees in the United States. Employees can contribute up to 25% of their salary, up to the federal maximum allowable limit, on a before-tax basis to the 401(k) Plan. Employee contributions are fully vested when contributed. Our contributions to the 401(k) Plan are discretionary and are expensed when incurred. We also match employee contributions to our 401(k) Plan at 25% of an employee’s contribution each pay period, up to a maximum of 3% of the employee’s salary during such pay period for the year ended December 31, 2019, compared to a maximum of 2% and 1% for the years ended December 31, 2018 and 2017 , respectively. Our matching contributions are expensed as incurred and vest one-third for each of the first three years |
Income Taxes | Income Taxes – We account for income taxes using the liability method. Deferred income taxes are determined based on the differences between the financial reporting and tax bases of assets and liabilities, using enacted statutory tax rates in effect for the year in which the differences are expected to reverse. We utilize a two-step approach for evaluating uncertain tax positions. Step one, Recognition , requires a company to determine if the weight of available evidence indicates that a tax position is more likely than not to be sustained upon audit, including resolution of related appeals or litigation processes, if any. Step two, Measurement , is based on the largest amount of benefit, which is more likely than not to be realized on ultimate settlement. We record interest and penalties related to uncertain tax positions as income tax expense in the consolidated financial statements. |
Seasonality | Seasonality – A greater number of our Medicare-related health insurance plans are sold in our fourth quarter during the Medicare annual enrollment period when Medicare-eligible individuals are permitted to change their Medicare Advantage and Medicare Part D prescription drug coverage for the following year. As a result, our Medicare plan-related commission revenue is highest in our fourth quarter. The majority of our individual and family health insurance plans are sold in the fourth quarter during the annual open enrollment period as defined under the federal Patient Protection and Affordable Care Act and related amendments in the Health Care and Education Reconciliation Act. Individuals and families generally are not able to purchase individual and family health insurance outside of these open enrollment periods, unless they qualify for a special enrollment period as a result of certain qualifying events, such as losing employer-sponsored health insurance or moving to another state. |
Adoption of New Accounting Standard; Recently Adopted Accounting Pronouncements | Recently Adopted Accounting Pronouncements Leases (Topic 842) – In February 2016, the FASB issued ASU No. 2016-02, Leases . ASU 2016-02 requires lessees to recognize a right-of-use asset and lease liability for all leases with terms of more than 12 months. Recognition, measurement, and presentation of expenses will depend on classification as a finance or operating lease. For lessors, the guidance modifies the classification criteria and the accounting for sales-type and direct finance leases. The guidance also eliminates existing real estate-specific provisions for all entities. The new standard was effective for annual reporting periods beginning after December 15, 2018, including interim periods within that reporting period. We adopted the standard using the optional modified retrospective transition method on January 1, 2019. As a result of adopting the ASU, on January 1, 2019, we recorded a right-of-use asset and lease liability of $23.3 million and $24.6 million , respectively. See Note 11 – Leases for further discussion on our leases. Recent Accounting Pronouncement Not Yet Adopted Financial Instruments – Credit Losses (Topic 326) – In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments — Credit Losses , which amends the guidance for accounting for assets that are potentially subject to credit risk. The amendments affect contract assets, loans, debt securities, trade receivables, net investments in leases, off-balance-sheet credit exposures, reinsurance receivables, and any other financial assets not excluded from the scope that have the contractual right to receive cash. ASU 2016-13 is effective for us beginning January 1, 2020 using a modified retrospective transition method. We are still in the process of assessing the impact on our consolidated financial statements and disclosure from the adoption of this standard update. Income Taxes (Topic 740) – In December 2019, the FASB issued ASU No. 2019-12, Income Tax, Simplifying the Accounting for Income Taxes , which aims to simplify the accounting by removing certain exceptions to the general principles in Topic 740 and improve consistent application of and simplify GAAP for other areas under this Topic by clarifying existing guidance. ASU 2019-12 is effective for us beginning January 1, 2021. The amendments in this standard update have individually different adoption approaches. We are still in the process of assessing the impact on our consolidated financial statements and disclosure from the adoption of this standard update. |
Summary of Business and Signi_3
Summary of Business and Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Accounting Policies [Abstract] | |
Property, Plant and Equipment | Depreciation and amortization is computed using the straight-line method based on estimated useful lives as follows: Computer equipment and software 3 to 5 years Office equipment and furniture 5 years Leasehold improvements* 5 to 10 years _______ * Lesser of useful life or related lease term |
Revenue (Tables)
Revenue (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue by Segment | The table below depicts the disaggregation of revenue by product and is consistent with how we evaluate our financial performance (in thousands): Year Ended December 31, 2019 2018 2017 Medicare Medicare Advantage $ 339,810 $ 143,445 $ 107,567 Medicare Supplement 40,345 31,166 15,436 Medicare Part D 26,824 14,609 11,085 Total Medicare 406,979 189,220 134,088 Individual and Family (1) Non-Qualified Health Plans 17,559 6,470 10,024 Qualified Health Plans 6,866 5,789 7,055 Total Individual and Family 24,425 12,259 17,079 Ancillary Short-term 10,524 5,583 5,503 Dental 5,238 2,717 5,062 Vision 2,002 1,467 1,607 Other 3,985 4,941 3,877 Total Ancillary 21,749 14,708 16,049 Small Business 9,922 8,595 7,501 Commission Bonus 3,601 2,429 2,166 Total Commission Revenue 466,676 227,211 176,883 Other Revenue 39,525 24,184 13,823 Total Revenue $ 506,201 $ 251,395 $ 190,706 _______ (1) We define our individual and family plan offerings as major medical individual and family health insurance plans, which does not include Medicare-related, small business or ancillary plans. Individual and family health insurance plans include both qualified and non-qualified plans. Qualified health plans are individual and family health insurance plans that meet the requirements of the Affordable Care Act and are offered through the government-run health insurance exchange in the relevant jurisdiction. Non-qualified health plans are individual and family health insurance plans that meet the requirements of the Affordable Care Act and are not offered through the exchange in the relevant jurisdiction. Individuals that purchase non-qualified health plans cannot receive a subsidy in connection with the purchase of those plans. Commission revenue by segment is presented in the table below (in thousands): Years Ended December 31, 2019 2018 2017 Medicare Commission Revenue from Members Approved During the Period (1) $ 355,916 $ 192,382 $ 134,093 Net Commission Revenue from Members Approved in Prior Periods (2) 55,292 (124 ) 917 Total Medicare Segment Commission Revenue $ 411,208 $ 192,258 $ 135,010 Individual, Family and Small Business Commission Revenue from Members Approved During the Period (1) $ 22,614 $ 24,079 $ 29,767 Net Commission Revenue from Members Approved in Prior Periods (2) 32,854 10,874 12,106 Total Individual, Family and Small Business Segment Commission Revenue $ 55,468 $ 34,953 $ 41,873 ________ (1) These amounts include commission bonus revenue. (2) These amounts reflect our revised estimates of cash collections for certain members approved prior to the relevant reporting period that are recognized as adjustments to revenue within the relevant reporting period. These amounts include revenue associated with renewing small business health insurance members. Adjustment revenue includes reductions to revenue for certain prior periods cohorts of $3.1 million , $3.2 million and $0.0 million for the years ended December 31, 2019, 2018 and 2017, respectively. |
Acquisition (Tables)
Acquisition (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Business Combinations [Abstract] | |
Schedule of Business Acquisitions | The major classes of assets and liabilities to which we have allocated the acquisition consideration were as follows (in thousands): Acquisition Consideration Cash paid $ 15,000 Fair value of equity awards issued to GoMedigap members (1) 5,595 Estimated fair value of earnout liability 27,700 $ 48,295 Allocation Cash and cash equivalents $ 71 Commission receivable - current 4,371 Prepaid expenses and other current assets 11 Commission receivable - non-current 11,103 Property and equipment, net 174 Accounts payable (110 ) Accrued compensation and benefits (132 ) Other current liabilities (130 ) Net tangible assets acquired 15,358 Intangible assets 6,800 Goodwill 26,137 Total intangible assets acquired 32,937 Total net assets acquired $ 48,295 _______ (1) The fair value of equity awards issued was determined based on the January 22, 2018 closing price of our common stock of $18.99 per share. |
Acquisition Fair Value Measurements | Assets acquired and liabilities assumed measured and reported at fair value are classified in one of the following categories based on inputs: Level 1 Unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 Unadjusted quoted prices in active markets for similar assets or liabilities; or unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active; or inputs other than quoted prices that are observable for the asset or liability. Level 3 Unobservable inputs for the asset or liability. |
Schedule of Acquired Indefinite-lived Intangible Assets by Major Class | Following are the details of the acquisition consideration allocated to the intangible assets acquired (in thousands): Technology $ 2,000 Trade names, trademarks and website addresses 4,800 Total intangible assets $ 6,800 |
Supplemental Financial Statem_2
Supplemental Financial Statement Information (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Balance Sheet Related Disclosures [Abstract] | |
Schedule Of Cash, Cash Equivalents and Restricted Cash | Our cash, cash equivalent and restricted cash balances are summarized as follows (in thousands): December 31, 2019 December 31, 2018 Cash $ 16,205 $ 12,766 Money market funds 7,261 323 Cash and cash equivalents $ 23,466 $ 13,089 Restricted cash 3,354 — Total cash, cash equivalents and restricted cash $ 26,820 $ 13,089 |
Schedule Of Accounts Receivable | Our total accounts receivable are summarized as of the periods presented below (in thousands): December 31, 2019 December 31, 2018 Commissions receivable - current $ 174,526 $ 134,190 Commissions receivable - non-current 414,696 211,668 Accounts receivable 2,332 3,601 Total accounts receivable $ 591,554 $ 349,459 |
Schedule Of Commissions Receivable | Our commission receivable activities are summarized as follows (in thousands): For the year ended December 31, 2019 2018 2017 Beginning balance $ 345,858 $ 279,417 $ 257,777 Commission revenue from members approved during the period (1) 378,530 216,461 163,860 Net commission revenue adjustments from members approved in prior period (2) 88,146 10,750 13,023 Cash receipts (223,312 ) (160,770 ) (155,243 ) Ending balance $ 589,222 $ 345,858 $ 279,417 ________ (1) These amounts include commission bonus revenue. (2) These amounts reflect our revised estimates of cash collections for certain members approved prior to the relevant reporting period that are recognized as adjustments to revenue within the relevant reporting period. These amounts include revenue associated with renewing small business health insurance members. |
Schedule Of Prepaid Expenses And Other Current Assets | Our prepaid expenses and other current assets are summarized as of the periods presented below (in thousands): December 31, 2019 December 31, 2018 Prepaid maintenance contracts $ 3,853 $ 1,937 Equity issuance costs — 294 Prepaid insurance 918 161 Prepaid rent 96 324 Income tax receivable 584 1,108 Other current assets 2,371 1,464 Prepaid expenses and other current assets $ 7,822 $ 5,288 |
Schedule Of Property And Equipment | Our property and equipment are summarized as of the periods presented below (in thousands): December 31, 2019 December 31, 2018 Computer equipment and software $ 17,893 $ 17,246 Office equipment and furniture 4,995 3,319 Leasehold improvements 6,051 6,345 Property and equipment, gross 28,939 26,910 Less accumulated depreciation and amortization (18,421 ) (19,226 ) Property and equipment, net $ 10,518 $ 7,684 |
Schedule Of Other Assets | Other assets are summarized as of the periods presented below (in thousands): December 31, 2019 December 31, 2018 Capitalized software project costs $ 14,718 $ 8,308 Debt issuance costs - non-current 1,149 1,099 Security deposits 555 483 Deferred tax assets 264 232 Income tax receivable 456 913 Other 862 241 Other assets $ 18,004 $ 11,276 |
Schedule Of Intangible Assets | The carrying amounts, accumulated amortization, net carrying value and weighted average remaining life of our definite-lived amortizable intangible assets, as well as our indefinite-lived intangible trademarks, are presented in the tables below (dollars in thousands, useful life in years): December 31, 2019 December 31, 2018 Gross Carrying Amount Accumulated Amortization Net Carrying Amount Weighted-average remaining useful life Gross Carrying Amount Accumulated Amortization Net Carrying Amount Weighted-average remaining useful life Technology $ 2,000 $ (1,278 ) $ 722 1.1 $ 2,000 $ (611 ) $ 1,389 2.1 Pharmacy and customer relationships 9,500 (9,183 ) 317 0.3 9,500 (8,234 ) 1,266 1.3 Trade names, trademarks and website addresses 5,700 (1,791 ) 3,909 8.0 5,700 (1,220 ) 4,480 8.9 Total intangible assets subject to amortization $ 17,200 $ (12,252 ) 4,948 $ 17,200 $ (10,065 ) $ 7,135 Indefinite-lived trademarks and domain names 5,114 Indefinite 5,114 Indefinite Intangible assets $ 10,062 $ 12,249 |
Schedule Of Intangible Assets Future Amortization Expense | As of December 31, 2019 , our expected amortization expense in future periods were as follows (in thousands): Years Ending December 31, Technology Pharmacy and Customer Relationships Trade Names, Trademarks and Website Addresses Total 2020 $ 667 $ 317 $ 509 $ 1,493 2021 55 — 480 535 2022 — — 480 480 2023 — — 480 480 2024 — — 480 480 Thereafter — — 1,480 1,480 Total $ 722 $ 317 $ 3,909 $ 4,948 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Fair Value Disclosures [Abstract] | |
Classifications of Fair Value Hierarchy | We classify the inputs used to measure fair value into the following hierarchy: Level 1 Unadjusted quoted prices in active markets for identical assets or liabilities. Level 2 Unadjusted quoted prices in active markets for similar assets or liabilities; unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active; inputs other than quoted prices that are observable for the asset or liability. Level 3 Unobservable inputs for the asset or liability. |
Summary of Financial Assets Measured at Fair Value on a Recurring Basis | The following table is a summary of financial assets measured at fair value on a recurring basis and their classification within the fair value hierarchy (in thousands): December 31, 2019 December 31, 2018 Carrying Value Level 1 Level 3 Total Carrying Value Level 1 Level 3 Total Assets Money market funds $ 7,261 $ 7,261 $ — $ 7,261 $ 323 $ 323 $ — $ 323 Liability Earnout liability - current $ 37,273 $ — $ 37,273 $ 37,273 $ 20,730 $ — $ 20,730 $ 20,730 Earnout liability - non-current — $ — 19,270 — $ 19,270 $ 19,270 Total liabilities measured and recorded at fair value $ 37,273 $ — $ 37,273 $ 37,273 $ 40,000 $ — $ 40,000 $ 40,000 |
Schedule of Earnout Liability Activity | Our earnout liability activities are summarized as follows (in thousands): Balance as of December 31, 2017 $ — Recognition of earnout liability upon acquisition of GoMedigap on January 22, 2018 27,700 Change in fair value 12,300 Balance as of December 31, 2018 $ 40,000 Change in fair value 24,079 Settlements (26,806 ) Balance as of December 31, 2019 $ 37,273 |
Equity (Tables)
Equity (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Stockholders' Equity Note [Abstract] | |
Common Stock Shares Reserved For Future Issuance | We generally issue previously unissued common stock upon the exercise of stock options, the vesting of restricted stock units and upon granting of restricted common stock awards; however we may reissue previously acquired treasury shares to satisfy these future issuances. Shares of authorized but unissued common stock reserved for future issuance were as follows (in thousands): December 31, 2019 December 31, 2018 Stock options issued and outstanding 649 1,005 Restricted stock units issued and outstanding 2,201 1,869 Shares available for grant 2,197 512 Total shares reserved 5,047 3,386 |
Schedule Of Stock Option Share Activity Under Stock Plans | The following table summarizes activity under our 2014 Equity Incentive Plan (the “2014 Plan”) for the year ended December 31, 2019 (in thousands): Beginning balance (1) 512 Additional shares authorized 2,500 Restricted stock units granted (2) (970 ) Options granted (3) (19 ) Restricted stock units cancelled (4) 124 Options cancelled 50 Ending balance 2,197 _______ (1) Shares available for grant do not include treasury stock shares that could be granted if we determined to do so. (2) Includes grants of restricted stock units with service, performance-based or market-based vesting criteria. (3) Includes grants of stock options with service, performance-based or market-based vesting criteria. (4) Includes cancelled restricted stock units with service, performance-based or market-based vesting criteria. |
Schedule Of Activity Under Stock Plans | The following table summarizes stock option activity under the Stock Plans (in thousands, except weighted-average exercise price and weighted-average remaining contractual life data): Number of Stock Options (1) Weighted Average Exercise Price Weighted-Average Remaining Contractual Life (years) Aggregate Intrinsic Value (2) Outstanding as of December 31, 2018 1,005 $ 18.34 5.0 $ 20,226 Granted 19 $ 63.54 Exercised (319 ) $ 17.45 Cancelled (56 ) $ 24.71 Outstanding balance as of December 31, 2019 649 $ 19.57 4.4 $ 49,661 Vested and expected to vest at December 31, 2019 631 $ 19.32 4.3 $ 48,404 Exercisable at December 31, 2019 428 $ 16.67 3.9 $ 33,995 _______ (1) Includes certain stock options with service, performance-based or market-based vesting criteria. (2) The aggregate intrinsic value is calculated as the product between eHealth’s closing stock price as of December 31, 2019 and 2018 at the exercise price of in-the-money options as of those dates. The following table provides information pertaining to our stock options for the years presented below (in thousands, except weighted-average fair values): Year Ended December 31, 2019 2018 2017 Weighted average fair value of options granted $ 33.19 $ 12.78 $ 9.03 Total fair value of options vested $ 2,924 $ 2,263 $ 799 Intrinsic value of options exercised $ 19,890 $ 1,461 $ 430 |
Schedule Of Restricted Stock Unit Activity Under Stock Plans | The following table summarizes restricted stock unit activity under the Stock Plans (in thousands, except weighted-average grant date fair value and weighted-average remaining contractual life data): Number of Restricted Stock Units (1) Weighted-Average Grant Date Fair Value Weighted-Average Remaining Service Period Aggregate Intrinsic Value (2) Unvested as of December 31, 2018 1,869 $ 16.95 4.8 $ 71,816 Granted 970 $ 17.96 Vested (514 ) $ 17.01 Cancelled (124 ) $ 31.50 Unvested as of December 31, 2019 2,201 $ 39.08 7.2 $ 211,443 _______ (1) Includes certain restricted stock units with service, performance-based or market-based vesting criteria. (2) The aggregate intrinsic value is calculated as the difference of our closing stock price as of December 31, 2019 and 2018 multiplied by the number of restricted stock units outstanding as of December 31, 2019 and 2018 , respectively. |
Schedule Of Fair Value Of Stock Options Granted, Valuation Assumptions | The weighted-average fair value of the market-based options and restricted stock units was determined using the Monte Carlo simulation model using the following weighted average assumptions: Year Ended December 31, 2019 2018 2017 Expected term 1.4 1.6 1.6 Expected volatility 57.8% 69.8% 70.9% Expected dividend yield —% —% —% Risk-free interest rate 2.4% 2.5% 1.7% Weighted-average grant date fair value $58.16 $13.48 $9.42 Stock-Based Compensation Expense – The fair value of stock options granted to employees was estimated using the following weighted average assumptions for the years presented below: Year Ended December 31, 2019 2018 2017 Expected term 4.3 4.3 4.3 Expected volatility 65.3% 68.3% 69.8% Expected dividend yield —% —% —% Risk-free interest rate 2.1% 2.7% 1.8% |
Schedule Of Stock-Based Compensation Expense By Award Type | The following table summarizes stock-based compensation expense recorded for the years presented below (in thousands): Year Ended December 31, 2019 2018 2017 Common stock options $ 2,215 $ 1,991 $ 1,863 Restricted stock units 20,355 10,549 7,831 Total stock-based compensation expense $ 22,570 $ 12,540 $ 9,694 |
Schedule Of Stock-Based Compensation Expense By Operating Function | The following table summarizes stock-based compensation expense by operating function for the years presented below (in thousands): Year Ended December 31, 2019 2018 2017 Marketing and advertising $ 4,230 $ 1,974 $ 1,033 Customer care and enrollment 1,451 816 418 Technology and content 3,611 1,675 1,410 General and administrative 13,278 7,824 6,833 Restructuring charges — 251 — Total stock-based compensation expense $ 22,570 $ 12,540 $ 9,694 |
Net Income Per Share (Tables)
Net Income Per Share (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Earnings Per Share [Abstract] | |
Schedule Of Computation Of Basic And Diluted Net Income Per Share | The following table sets forth the computation of basic and diluted net income per share (in thousands, except per share amounts): Year Ended December 31, 2019 2018 2017 Basic Net income $ 66,887 $ 241 $ 25,426 Shares used in per share calculation - basic 23,075 19,294 18,512 Net income per share – basic $ 2.90 $ 0.01 $ 1.37 Diluted Net income $ 66,887 $ 241 $ 25,426 Shares used in per share calculation - basic 23,075 19,294 18,512 Dilutive effect of common stock 1,464 1,115 535 Total common stock shares used in diluted share calculation 24,539 20,409 19,047 Net income per share – diluted $ 2.73 $ 0.01 $ 1.33 |
Schedule Of Anti-dilutive Shares Excluded From Computation Of Net Income Per Share | The number of outstanding anti-dilutive shares that were excluded from the computation of diluted net income per share consisted of the following (in thousands): Year Ended December 31, 2019 2018 2017 Common stock options 11 291 908 Restricted stock units 41 13 1,296 Total 52 304 2,204 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule Of Future Minimum Payments For Operating Leases And Contractual Obligations | The following table presents a summary of our future minimum payments under non-cancellable operating lease agreements and contractual service and licensing obligations as of December 31, 2019 (in thousands): For the Years Ending December 31, Operating Lease Obligations Service and Licensing Obligations Total Obligations 2020 $ 7,040 $ 3,073 $ 10,113 2021 6,529 1,825 8,354 2022 5,266 692 5,958 2023 6,103 444 6,547 2024 5,909 229 6,138 Thereafter 21,983 — 21,983 Total $ 52,830 $ 6,263 $ 59,093 |
Segment and Geographic Inform_2
Segment and Geographic Information (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | The results of our operating segments are summarized for the periods presented below (in thousands): Year Ended December 31, 2019 2018 2017 Revenue Medicare $ 446,961 $ 210,570 $ 142,448 Individual, Family and Small Business 59,240 40,825 48,258 Total revenue $ 506,201 $ 251,395 $ 190,706 Segment profit Medicare segment profit $ 155,234 $ 60,844 $ 22,137 Individual, Family and Small Business segment profit 23,368 5,803 9,573 Total segment profit 178,602 66,647 31,710 Corporate (45,374 ) (32,996 ) (26,970 ) Stock-based compensation expense (22,570 ) (12,289 ) (9,694 ) Depreciation and amortization (2,983 ) (2,479 ) (2,837 ) Change in fair value of earnout liability (24,079 ) (12,300 ) — Restructuring charge — (1,865 ) — Acquisition costs — (76 ) (621 ) Amortization of intangible assets (2,187 ) (2,091 ) (1,040 ) Other income (expense), net 2,090 755 $ 1,182 Income (loss) before provision (benefit) for income taxes $ 83,499 $ 3,306 $ (8,270 ) |
Schedule Of Long Lived Assets By Geographical Areas | Long-lived assets (excluding intangible assets and goodwill) by geographical area are summarized as follows (in thousands): December 31, 2019 December 31, 2018 United States $ 64,408 $ 18,228 China 471 499 Total $ 64,879 $ 18,727 |
Schedule Of Revenue By Major Customers | Carriers representing 10% or more of our total revenue are summarized as follows: Year Ended December 31, 2019 2018 2017 Humana 26 % 22 % 20 % UnitedHealthcare (1) 19 % 19 % 23 % Aetna (2) 17 % 14 % 10 % ____________ (1) UnitedHealthcare also includes other carriers owned by UnitedHealthcare. (2) Aetna includes other carriers owned by Aetna. |
Restructuring (Tables)
Restructuring (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Restructuring and Related Activities [Abstract] | |
Schedule of Restructuring Charges | The following table summarizes the total cash and non-cash restructuring charges recognized during the periods presented below (in thousands): December 31, 2018 Employee termination costs $ 1,605 Non-cash employee termination costs - stock-based compensation 251 Other restructuring related costs 9 Total restructuring charges $ 1,865 |
Schedule of Restructuring Reserve | The following table summarizes the accrued restructuring charges activity during the periods presented below (in thousands): Year Ended December 31, 2018 Beginning balance Charges Payments Ending balance Employee termination costs $ — $ 1,605 $ (1,605 ) $ — Accrued restructuring charges - current $ — $ 1,605 $ (1,605 ) $ — |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Leases [Abstract] | |
Schedule of Supplemental Balance Sheet Information | Supplemental information as of December 31, 2019 related to leases is as follows (in thousands): Operating lease right-of-use assets $ 36,621 Operating lease liabilities $ 39,064 Weighted-average remaining lease term of operating leases 7.6 years Weighted-average discount rate used to recognize operating lease right-of-use-assets* 5.9 % _______ * As our leases do not provide an implicit rate of interest, we use our incremental borrowing rate based on the information available at commencement date or remeasurement date in determining the present value of lease payments. |
Schedule of Operating Lease Maturities | As of December 31, 2019 , maturities of operating lease liabilities are as follows (in thousands): Year ending December 31, 2020 $ 7,040 2021 6,529 2022 5,266 2023 6,103 2024 5,909 Thereafter 21,983 Total lease payments 52,830 Less imputed interest (13,766 ) Total $ 39,064 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Income Tax Disclosure [Abstract] | |
Schedule Of Income Before Income Tax, Domestic And Foreign | The components of our income (loss) before provision (benefit) for income taxes were as follows (in thousands): Year Ended December 31, 2019 2018 2017 United States $ 82,391 $ 2,458 $ (9,242 ) Foreign 1,108 848 972 Income (loss) before provision (benefit) for income taxes $ 83,499 $ 3,306 $ (8,270 ) |
Schedule Of Components Of Income Tax Expense | The federal and state income tax provision (benefit) is summarized as follows (in thousands): Year Ended December 31, 2019 2018 2017 Current: Federal $ — $ 5 $ (275 ) State 75 48 (1,433 ) Foreign 326 213 179 Total current 401 266 (1,529 ) Deferred: Federal 13,594 165 (28,161 ) State 2,635 2,648 (3,992 ) Foreign (18 ) (14 ) (14 ) Total deferred 16,211 2,799 (32,167 ) Provision (benefit) for income taxes $ 16,612 $ 3,065 $ (33,696 ) |
Schedule Of Effective Income Tax Rate Reconciliation | The effective tax rate of our provision (benefit) for income taxes differs from the federal statutory rate as follows: Year Ended December 31, 2019 2018 2017 Statutory rate 21.0 % 21.0 % 35.0 % State income taxes, net of federal benefit 2.6 (7.2 ) 31.7 Stock-based compensation shortfalls (windfalls), net (7.0 ) (29.4 ) 1.9 Non-deductible stock-based compensation 2.5 21.6 (9.7 ) Non-deductible lobbying expenses 1.0 15.2 (9.1 ) Research and development credits (0.9 ) (17.1 ) (1.5 ) Changes in valuation allowance — 72.8 — Tax reform - tax rate change — — 355.9 Foreign income tax and income inclusion 0.1 6.8 2.7 Non-deductible parking expense 0.2 3.1 — Other permanent differences 0.4 5.9 0.7 Effective tax rate 19.9 % 92.7 % 407.6 % |
Schedule Of Deferred Tax Assets And Liabilities | The tax effects of significant items comprising our deferred taxes as of December 31, 2019 and 2018 were as follows (in thousands): December 31, 2019 December 31, 2018 Deferred tax assets: Net operating losses $ 60,023 $ 22,181 Accruals and reserves 4,143 3,370 Operating lease liabilities 9,471 — Intangible assets 6,306 2,269 Tax credits 5,818 4,508 Stock-based compensation 2,835 2,388 Fixed assets 203 61 Other 187 250 Total deferred tax assets 88,986 35,027 Valuation allowance (2,407 ) (2,407 ) Total deferred tax assets net of valuation allowance 86,579 32,620 Deferred tax liabilities: Commissions receivable (141,566 ) (80,289 ) Right-of-use assets (8,879 ) — Total deferred tax liabilities $ (150,445 ) $ (80,289 ) Net deferred tax liabilities $ (63,866 ) $ (47,669 ) |
Summary of Changes in Valuation Allowance | The changes of our valuation allowance is summarized as follows (in thousands): Deferred Tax Assets - Valuation Allowance Balance at beginning of year Provision for income taxes Balance at end of year Year Ended December 31, 2019 $ 2,407 $ — $ 2,407 Year Ended December 31, 2018 $ — $ 2,407 $ 2,407 Year Ended December 31, 2017 $ — $ — $ — |
Schedule Of Unrecognized Tax Benefits Roll Forward | A reconciliation of the beginning and ending amount of our unrecognized tax benefits is as follows (in thousands): Unrecognized Tax Benefits Balance as of December 31, 2016 $ 5,253 Decrease based on tax positions related to the prior year (862 ) Lapse of statute of limitations (1,637 ) Additions based on tax positions related to the current year 342 Balance as of December 31, 2017 3,096 Increase based on tax positions related to the prior year 579 Lapse of statute of limitations (5 ) Additions based on tax positions related to the current year 70 Balance as of December 31, 2018 3,740 Additions based on tax positions related to the current year 969 Balance as of December 31, 2019 $ 4,709 |
Selected Quarterly Financial _2
Selected Quarterly Financial Data (Unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Selected Quarterly Financial Information [Abstract] | |
Schedule Of Quarterly Financial Information (Unaudited) | Selected summarized quarterly financial information for 2019 and 2018 is as follows (in thousands, except per share amounts): For the Year Ended December 31, 2019 First Second Third Fourth Year Revenue $ 68,773 $ 65,767 $ 69,913 $ 301,748 $ 506,201 Income (loss) from operations (9,183 ) (12,311 ) (20,241 ) 123,144 81,409 Net income (loss) (5,159 ) (5,754 ) (11,024 ) 88,824 66,887 Net income (loss) per share: Basic $ (0.24 ) $ (0.25 ) $ (0.47 ) $ 3.74 $ 2.90 Diluted $ (0.24 ) $ (0.25 ) $ (0.47 ) $ 3.58 $ 2.73 For the Year Ended December 31, 2018 First Second Third Fourth Year Revenue $ 43,070 $ 32,657 $ 40,751 $ 134,917 $ 251,395 Income (loss) from operations (6,720 ) (16,920 ) (15,454 ) 41,645 2,551 Net income (loss) (4,845 ) (12,014 ) (8,972 ) 26,072 241 Net income (loss) per share: Basic $ (0.26 ) $ (0.63 ) $ (0.47 ) $ 1.32 $ 0.01 Diluted $ (0.26 ) $ (0.63 ) $ (0.47 ) $ 1.25 $ 0.01 _______ * See Note 2 – Revenue for details regarding the change in estimate in the fourth quarter of 2019. |
Summary of Business and Signi_4
Summary of Business and Significant Accounting Policies (Narrative) (Details) | 12 Months Ended | 20 Months Ended | ||||
Dec. 31, 2019USD ($)segmentstate | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Jun. 30, 2012USD ($) | Jan. 01, 2019USD ($) | ||
Defined Contribution Plan Disclosure [Line Items] | ||||||
Number of states in which the Company is licensed to market and sell health insurance | state | 50 | |||||
Number of operating segments | segment | 2 | |||||
Goodwill impairment | $ 0 | $ 0 | ||||
Payment terms | Payment of commissions typically commences within 60 days from the effective date. Payment terms for non-commission revenue are typically 30 days from the invoice date | |||||
Book-of-business transfers acquired | $ 13,900,000 | |||||
Book-of-business margin earned | $ 600,000 | 800,000 | $ 900,000 | |||
Advertising expense | 122,600,000 | 64,400,000 | 56,000,000 | |||
Research and development expense | 8,100,000 | 6,900,000 | 7,600,000 | |||
Capitalized internal-use software and website development costs | 10,200,000 | 6,300,000 | 3,200,000 | |||
Amortization of internally developed software | $ 3,821,000 | $ 2,201,000 | $ 1,464,000 | |||
Vesting term for awards | 4 years | |||||
Maximum annual contributions per employee, percentage | 25.00% | |||||
Matching contribution, percent of match | 25.00% | |||||
Maximum matching contribution percentage | 3.00% | 2.00% | 1.00% | |||
Matching contributions, vesting period | 3 years | |||||
Contribution amount | $ 2,300,000 | $ 1,000,000 | $ 400,000 | |||
Operating lease right-of-use assets | [1] | 36,621,000 | ||||
Operating lease liabilities | $ 39,064,000 | |||||
Internal-Use Software and Website Development Costs | ||||||
Defined Contribution Plan Disclosure [Line Items] | ||||||
Useful life | 3 years | |||||
Accounting Standards Update 2016-02 | ||||||
Defined Contribution Plan Disclosure [Line Items] | ||||||
Operating lease right-of-use assets | $ 23,300,000 | |||||
Operating lease liabilities | $ 24,600,000 | |||||
Period One | ||||||
Defined Contribution Plan Disclosure [Line Items] | ||||||
Annual vesting percentage | 33.00% | |||||
Period Two | ||||||
Defined Contribution Plan Disclosure [Line Items] | ||||||
Annual vesting percentage | 33.00% | |||||
Period Three | ||||||
Defined Contribution Plan Disclosure [Line Items] | ||||||
Annual vesting percentage | 33.00% | |||||
Individual and Family | Minimum | ||||||
Defined Contribution Plan Disclosure [Line Items] | ||||||
Insurance plan duration | 1 year 6 months | |||||
Individual and Family | Maximum | ||||||
Defined Contribution Plan Disclosure [Line Items] | ||||||
Insurance plan duration | 2 years | |||||
Product Concentration Risk | Revenue from Contract with Customer | Medicare | ||||||
Defined Contribution Plan Disclosure [Line Items] | ||||||
Commission revenue, percentage | 87.00% | 83.00% | 76.00% | |||
Medicare Advantage | Medicare | ||||||
Defined Contribution Plan Disclosure [Line Items] | ||||||
Insurance plan duration | 3 years | |||||
Medicare Advantage | Medicare | Maximum | ||||||
Defined Contribution Plan Disclosure [Line Items] | ||||||
Insurance plan duration | 12 years | |||||
Medicare Part D | Medicare | ||||||
Defined Contribution Plan Disclosure [Line Items] | ||||||
Insurance plan duration | 5 years | |||||
Medicare Supplement | Medicare | ||||||
Defined Contribution Plan Disclosure [Line Items] | ||||||
Insurance plan duration | 5 years | |||||
Other | Ancillary | Minimum | ||||||
Defined Contribution Plan Disclosure [Line Items] | ||||||
Insurance plan duration | 1 year | |||||
Other | Ancillary | Maximum | ||||||
Defined Contribution Plan Disclosure [Line Items] | ||||||
Insurance plan duration | 3 years | |||||
[1] | Reflects the impact from the adoption of ASC 842 on January 1, 2019. See Note 11 – Leases for details. |
Summary of Business and Signi_5
Summary of Business and Significant Accounting Policies (Property and Equipment) (Details) | 12 Months Ended | |
Dec. 31, 2019 | ||
Computer equipment and software | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Useful life | 3 years | |
Computer equipment and software | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Useful life | 5 years | |
Office equipment and furniture | ||
Property, Plant and Equipment [Line Items] | ||
Useful life | 5 years | |
Leasehold improvements | Minimum | ||
Property, Plant and Equipment [Line Items] | ||
Useful life | 5 years | [1] |
Leasehold improvements | Maximum | ||
Property, Plant and Equipment [Line Items] | ||
Useful life | 10 years | [1] |
[1] | Lesser of useful life or related lease term |
Revenue (Narrative) (Details)
Revenue (Narrative) (Details) - USD ($) $ / shares in Units, $ in Thousands | Jan. 01, 2019 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Jan. 01, 2017 | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||||||
Total revenue | $ 301,748 | [1] | $ 69,913 | $ 65,767 | $ 68,773 | $ 134,917 | $ 40,751 | $ 32,657 | $ 43,070 | $ 506,201 | $ 251,395 | $ 190,706 | |||
Net Income per share - basic (in usd per share) | $ 3.74 | [1] | $ (0.47) | $ (0.25) | $ (0.24) | $ 1.32 | $ (0.47) | $ (0.63) | $ (0.26) | $ 2.90 | $ 0.01 | $ 1.37 | |||
Net Income per share - diluted (in usd per share) | $ 3.58 | [1] | $ (0.47) | $ (0.25) | $ (0.24) | $ 1.25 | $ (0.47) | $ (0.63) | $ (0.26) | $ 2.73 | $ 0.01 | $ 1.33 | |||
Accounting Standards Update 2014-09 | Retained Earnings | |||||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||||||
Retained earnings increase | $ 174,700 | ||||||||||||||
Net commission revenue adjustments from members approved in prior period | |||||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||||||
Total revenue | $ 88,146 | $ 10,750 | $ 13,023 | ||||||||||||
Net Income per share - basic (in usd per share) | $ 3.82 | $ 0.56 | $ 0.70 | ||||||||||||
Net Income per share - diluted (in usd per share) | $ 3.59 | $ 0.53 | $ 0.68 | ||||||||||||
Medicare Advantage | |||||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||||||
Insurance plan, number of years sold | 7 years | ||||||||||||||
Medicare Advantage | Net commission revenue adjustments from members approved in prior period | |||||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||||||
Total revenue | $ 50,800 | $ 55,300 | |||||||||||||
Individual, Family and Small Business | |||||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||||||
Total revenue | 55,468 | $ 34,953 | $ 41,873 | ||||||||||||
Individual, Family and Small Business | Net commission revenue adjustments from members approved in prior period | |||||||||||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||||||||||
Total revenue | [2] | $ 32,854 | $ 10,874 | $ 12,106 | |||||||||||
[1] | See Note 2 – Revenue for details regarding the change in estimate in the fourth quarter of 2019. | ||||||||||||||
[2] | These amounts reflect our revised estimates of cash collections for certain members approved prior to the relevant reporting period that are recognized as adjustments to revenue within the relevant reporting period. These amounts include revenue associated with renewing small business health insurance members. Adjustment revenue includes reductions to revenue for certain prior periods cohorts of $3.1 million , $3.2 million and $0.0 million for the years ended December 31, 2019, 2018 and 2017, respectively. |
Revenue (Commission Revenue by
Revenue (Commission Revenue by Segment) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||
Dec. 31, 2019 | [1] | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | $ 301,748 | $ 69,913 | $ 65,767 | $ 68,773 | $ 134,917 | $ 40,751 | $ 32,657 | $ 43,070 | $ 506,201 | $ 251,395 | $ 190,706 | ||
Commission revenue from members approved during the period | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 378,530 | 216,461 | 163,860 | ||||||||||
Net commission revenue adjustments from members approved in prior period | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 88,146 | 10,750 | 13,023 | ||||||||||
Medicare | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 411,208 | 192,258 | 135,010 | ||||||||||
Medicare | Commission revenue from members approved during the period | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | [2] | 355,916 | 192,382 | 134,093 | |||||||||
Medicare | Net commission revenue adjustments from members approved in prior period | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | [3] | 55,292 | (124) | 917 | |||||||||
Individual, Family and Small Business | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 55,468 | 34,953 | 41,873 | ||||||||||
Individual, Family and Small Business | Commission revenue from members approved during the period | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | [2] | 22,614 | 24,079 | 29,767 | |||||||||
Individual, Family and Small Business | Net commission revenue adjustments from members approved in prior period | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | [3] | 32,854 | 10,874 | 12,106 | |||||||||
Impairment of LTV estimate | $ 3,100 | $ 3,200 | $ 0 | ||||||||||
[1] | See Note 2 – Revenue for details regarding the change in estimate in the fourth quarter of 2019. | ||||||||||||
[2] | These amounts include commission bonus revenue. | ||||||||||||
[3] | These amounts reflect our revised estimates of cash collections for certain members approved prior to the relevant reporting period that are recognized as adjustments to revenue within the relevant reporting period. These amounts include revenue associated with renewing small business health insurance members. Adjustment revenue includes reductions to revenue for certain prior periods cohorts of $3.1 million , $3.2 million and $0.0 million for the years ended December 31, 2019, 2018 and 2017, respectively. |
Revenue (Disaggregated Revenue)
Revenue (Disaggregated Revenue) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | |||||||||||
Dec. 31, 2019 | [1] | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | $ 301,748 | $ 69,913 | $ 65,767 | $ 68,773 | $ 134,917 | $ 40,751 | $ 32,657 | $ 43,070 | $ 506,201 | $ 251,395 | $ 190,706 | ||
Medicare | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 406,979 | 189,220 | 134,088 | ||||||||||
Individual and Family | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | [2] | 24,425 | 12,259 | 17,079 | |||||||||
Ancillary | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 21,749 | 14,708 | 16,049 | ||||||||||
Small Business | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 9,922 | 8,595 | 7,501 | ||||||||||
Commission Bonus | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 3,601 | 2,429 | 2,166 | ||||||||||
Total Commission Revenue | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 466,676 | 227,211 | 176,883 | ||||||||||
Other | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 39,525 | 24,184 | 13,823 | ||||||||||
Medicare Advantage | Medicare | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 339,810 | 143,445 | 107,567 | ||||||||||
Medicare Supplement | Medicare | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 40,345 | 31,166 | 15,436 | ||||||||||
Medicare Part D | Medicare | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 26,824 | 14,609 | 11,085 | ||||||||||
Non-Qualified Health Plans | Individual and Family | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | [2] | 17,559 | 6,470 | 10,024 | |||||||||
Qualified Health Plans | Individual and Family | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | [2] | 6,866 | 5,789 | 7,055 | |||||||||
Short-term | Ancillary | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 10,524 | 5,583 | 5,503 | ||||||||||
Dental | Ancillary | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 5,238 | 2,717 | 5,062 | ||||||||||
Vision | Ancillary | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | 2,002 | 1,467 | 1,607 | ||||||||||
Other | Ancillary | |||||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||||
Total revenue | $ 3,985 | $ 4,941 | $ 3,877 | ||||||||||
[1] | See Note 2 – Revenue for details regarding the change in estimate in the fourth quarter of 2019. | ||||||||||||
[2] | We define our individual and family plan offerings as major medical individual and family health insurance plans, which does not include Medicare-related, small business or ancillary plans. Individual and family health insurance plans include both qualified and non-qualified plans. Qualified health plans are individual and family health insurance plans that meet the requirements of the Affordable Care Act and are offered through the government-run health insurance exchange in the relevant jurisdiction. Non-qualified health plans are individual and family health insurance plans that meet the requirements of the Affordable Care Act and are not offered through the exchange in the relevant jurisdiction. Individuals that purchase non-qualified health plans cannot receive a subsidy in connection with the purchase of those plans. |
Acquisition - Narrative (Detai
Acquisition - Narrative (Details) - USD ($) $ in Thousands | Jan. 22, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Feb. 28, 2019 |
Business Acquisition [Line Items] | |||||
Change in fair value of earnout liability | $ 24,079 | $ 12,300 | $ 0 | ||
Acquisition costs | $ 0 | 76 | $ 621 | ||
GoMedigap | |||||
Business Acquisition [Line Items] | |||||
Cash paid | $ 15,000 | ||||
Cash and cash equivalents | $ 71 | ||||
Shares acquired (in shares) | 294,637 | ||||
Earnout consideration | $ 20,000 | ||||
Earnout consideration (in shares) | 589,275 | 294,608 | |||
Goodwill deductible period | 15 years | ||||
Revenue since acquisition | $ 15,200 | ||||
Trade names, trademarks and website addresses | |||||
Business Acquisition [Line Items] | |||||
Weighted-average remaining useful life | 8 years | 8 years 10 months 24 days | |||
Minimum | Trade names, trademarks and website addresses | GoMedigap | |||||
Business Acquisition [Line Items] | |||||
Weighted-average remaining useful life | 3 years | ||||
Maximum | Trade names, trademarks and website addresses | GoMedigap | |||||
Business Acquisition [Line Items] | |||||
Weighted-average remaining useful life | 10 years |
Acquisition - Purchase Price A
Acquisition - Purchase Price Allocation (Details) - USD ($) $ / shares in Units, $ in Thousands | Jan. 22, 2018 | Feb. 28, 2019 | Dec. 31, 2019 | [1] | Dec. 31, 2018 | |
Allocation | ||||||
Goodwill | $ 40,233 | $ 40,233 | ||||
Share price (in usd per share) | $ 18.99 | |||||
GoMedigap | ||||||
Acquisition Consideration | ||||||
Cash paid | $ 15,000 | |||||
Fair value of equity awards issued to GoMedigap members | 5,595 | [2] | $ 17,300 | |||
Recognition of earnout liability upon acquisition of GoMedigap on January 22, 2018 | 27,700 | |||||
Purchase price | 48,295 | |||||
Allocation | ||||||
Cash and cash equivalents | 71 | |||||
Commission receivable - current | 4,371 | |||||
Prepaid expenses and other current assets | 11 | |||||
Commission receivable - non-current | 11,103 | |||||
Property and equipment, net | 174 | |||||
Accounts payable | (110) | |||||
Accrued compensation and benefits | (132) | |||||
Other current liabilities | (130) | |||||
Net tangible assets acquired | 15,358 | |||||
Intangible assets | 6,800 | |||||
Goodwill | 26,137 | |||||
Total intangible assets acquired | 32,937 | |||||
Total net assets acquired | 48,295 | |||||
Technology | GoMedigap | ||||||
Allocation | ||||||
Intangible assets | 2,000 | |||||
Trade names, trademarks and website addresses | GoMedigap | ||||||
Allocation | ||||||
Intangible assets | $ 4,800 | |||||
[1] | Reflects the impact from the adoption of ASC 842 on January 1, 2019. See Note 11 – Leases for details. | |||||
[2] | The fair value of equity awards issued was determined based on the January 22, 2018 closing price of our common stock of $18.99 per share. |
Supplemental Financial Statem_3
Supplemental Financial Statement Information (Narrative) (Details) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2019USD ($)customer | Dec. 31, 2018USD ($)customer | Dec. 31, 2017USD ($) | ||
Concentration Risk [Line Items] | ||||
Restricted cash | $ 3,354 | [1] | $ 0 | |
Accounts receivable | 591,554 | 349,459 | ||
Depreciation | 2,983 | 2,479 | $ 2,837 | |
Amortization of acquired intangible assets | $ 2,187 | $ 2,091 | $ 1,040 | |
Accounts Receivable | Customer Concentration Risk | ||||
Concentration Risk [Line Items] | ||||
Number of significant customers | customer | 3 | 3 | ||
Concentration risk, percentage | 62.00% | 57.00% | ||
Accounts Receivable | Customer Concentration Risk | Customer One | ||||
Concentration Risk [Line Items] | ||||
Concentration risk, percentage | 22.00% | 19.00% | ||
Accounts Receivable | Customer Concentration Risk | Customer Two | ||||
Concentration Risk [Line Items] | ||||
Concentration risk, percentage | 20.00% | 19.00% | ||
Accounts Receivable | Customer Concentration Risk | Customer Three | ||||
Concentration Risk [Line Items] | ||||
Concentration risk, percentage | 20.00% | 19.00% | ||
[1] | Reflects the impact from the adoption of ASC 842 on January 1, 2019. See Note 11 – Leases for details. |
Supplemental Financial Statem_4
Supplemental Financial Statement Information (Schedule of Cash, Cash Equivalents and Restricted Cash) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Balance Sheet Related Disclosures [Abstract] | |||||
Cash | $ 16,205 | $ 12,766 | |||
Money market funds | 7,261 | 323 | |||
Cash and cash equivalents | 23,466 | [1] | 13,089 | ||
Restricted cash | 3,354 | [1] | 0 | ||
Total cash, cash equivalents and restricted cash | $ 26,820 | $ 13,089 | $ 40,293 | $ 61,781 | |
[1] | Reflects the impact from the adoption of ASC 842 on January 1, 2019. See Note 11 – Leases for details. |
Supplemental Financial Statem_5
Supplemental Financial Statement Information (Schedule of Accounts Receivable) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | |
Balance Sheet Related Disclosures [Abstract] | |||
Commissions receivable - current | $ 174,526 | [1] | $ 134,190 |
Commissions receivable - non-current | 414,696 | [1] | 211,668 |
Accounts receivable | 2,332 | [1] | 3,601 |
Total accounts receivable | $ 591,554 | $ 349,459 | |
[1] | Reflects the impact from the adoption of ASC 842 on January 1, 2019. See Note 11 – Leases for details. |
Supplemental Financial Statem_6
Supplemental Financial Statement Information (Schedule of Commissions Receivable) (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Disaggregation of Revenue [Line Items] | ||||||||||||
Beginning balance | $ 345,858 | $ 279,417 | $ 345,858 | $ 279,417 | $ 257,777 | |||||||
Total revenue | $ 301,748 | [1] | $ 69,913 | $ 65,767 | $ 68,773 | $ 134,917 | $ 40,751 | $ 32,657 | $ 43,070 | 506,201 | 251,395 | 190,706 |
Cash receipts | (223,312) | (160,770) | (155,243) | |||||||||
Ending balance | $ 589,222 | $ 345,858 | 589,222 | 345,858 | 279,417 | |||||||
Commission revenue from members approved during the period | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Total revenue | 378,530 | 216,461 | 163,860 | |||||||||
Net commission revenue adjustments from members approved in prior period | ||||||||||||
Disaggregation of Revenue [Line Items] | ||||||||||||
Total revenue | $ 88,146 | $ 10,750 | $ 13,023 | |||||||||
[1] | See Note 2 – Revenue for details regarding the change in estimate in the fourth quarter of 2019. |
Supplemental Financial Statem_7
Supplemental Financial Statement Information (Schedule of Prepaid Expenses and Other Current Assets) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | |
Balance Sheet Related Disclosures [Abstract] | |||
Prepaid maintenance contracts | $ 3,853 | $ 1,937 | |
Equity issuance costs | 0 | 294 | |
Prepaid insurance | 918 | 161 | |
Prepaid rent | 96 | 324 | |
Income tax receivable | 584 | 1,108 | |
Other current assets | 2,371 | 1,464 | |
Prepaid expenses and other current assets | $ 7,822 | [1] | $ 5,288 |
[1] | Reflects the impact from the adoption of ASC 842 on January 1, 2019. See Note 11 – Leases for details. |
Supplemental Financial Statem_8
Supplemental Financial Statement Information (Schedule of Property and Equipment) (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Balance Sheet Related Disclosures [Abstract] | ||||
Depreciation and amortization | $ 2,983 | $ 2,479 | $ 2,837 | |
Computer equipment and software | 17,893 | 17,246 | ||
Office equipment and furniture | 4,995 | 3,319 | ||
Leasehold improvements | 6,051 | 6,345 | ||
Property and equipment, gross | 28,939 | 26,910 | ||
Less accumulated depreciation and amortization | (18,421) | (19,226) | ||
Property and equipment, net | $ 10,518 | [1] | $ 7,684 | |
[1] | Reflects the impact from the adoption of ASC 842 on January 1, 2019. See Note 11 – Leases for details. |
Supplemental Financial Statem_9
Supplemental Financial Statement Information (Schedule of Other Assets) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Balance Sheet Related Disclosures [Abstract] | ||
Capitalized software project costs | $ 14,718 | $ 8,308 |
Debt issuance costs - non-current | 1,149 | 1,099 |
Security deposits | 555 | 483 |
Deferred tax assets | 264 | 232 |
Income tax receivable | 456 | 913 |
Other | 862 | 241 |
Other assets | $ 18,004 | $ 11,276 |
Supplemental Financial State_10
Supplemental Financial Statement Information (Schedule of Intangible Assets) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | ||
Schedule Of Intangible Assets [Line Items] | |||
Gross Carrying Amount | $ 17,200 | $ 17,200 | |
Accumulated Amortization | (12,252) | (10,065) | |
Total | 4,948 | 7,135 | |
Indefinite-lived trademarks and domain names | 5,114 | 5,114 | |
Intangible assets | 10,062 | [1] | 12,249 |
Technology | |||
Schedule Of Intangible Assets [Line Items] | |||
Gross Carrying Amount | 2,000 | 2,000 | |
Accumulated Amortization | (1,278) | (611) | |
Total | $ 722 | $ 1,389 | |
Weighted-average remaining useful life | 1 year 1 month 6 days | 2 years 1 month 6 days | |
Pharmacy and customer relationships | |||
Schedule Of Intangible Assets [Line Items] | |||
Gross Carrying Amount | $ 9,500 | $ 9,500 | |
Accumulated Amortization | (9,183) | (8,234) | |
Total | $ 317 | $ 1,266 | |
Weighted-average remaining useful life | 3 months 18 days | 1 year 3 months 18 days | |
Trade names, trademarks and website addresses | |||
Schedule Of Intangible Assets [Line Items] | |||
Gross Carrying Amount | $ 5,700 | $ 5,700 | |
Accumulated Amortization | (1,791) | (1,220) | |
Total | $ 3,909 | $ 4,480 | |
Weighted-average remaining useful life | 8 years | 8 years 10 months 24 days | |
[1] | Reflects the impact from the adoption of ASC 842 on January 1, 2019. See Note 11 – Leases for details. |
Supplemental Financial State_11
Supplemental Financial Statement Information (Schedule of Intangible Asset Future Amortization Expense) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Finite-Lived Intangible Assets [Line Items] | ||
2020 | $ 1,493 | |
2021 | 535 | |
2022 | 480 | |
2023 | 480 | |
2024 | 480 | |
Thereafter | 1,480 | |
Total | 4,948 | $ 7,135 |
Technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
2020 | 667 | |
2021 | 55 | |
2022 | 0 | |
2023 | 0 | |
2024 | 0 | |
Thereafter | 0 | |
Total | 722 | 1,389 |
Pharmacy and customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
2020 | 317 | |
2021 | 0 | |
2022 | 0 | |
2023 | 0 | |
2024 | 0 | |
Thereafter | 0 | |
Total | 317 | 1,266 |
Trade names, trademarks and website addresses | ||
Finite-Lived Intangible Assets [Line Items] | ||
2020 | 509 | |
2021 | 480 | |
2022 | 480 | |
2023 | 480 | |
2024 | 480 | |
Thereafter | 1,480 | |
Total | $ 3,909 | $ 4,480 |
Fair Value Measurements (Financ
Fair Value Measurements (Financial Assets and Liabilities) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Carrying Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities measured and recorded at fair value | $ 37,273 | $ 40,000 |
Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities measured and recorded at fair value | 37,273 | 40,000 |
Fair Value | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities measured and recorded at fair value | 0 | 0 |
Fair Value | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities measured and recorded at fair value | 37,273 | 40,000 |
Money market funds | Carrying Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 7,261 | 323 |
Money market funds | Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 7,261 | 323 |
Money market funds | Fair Value | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 7,261 | 323 |
Money market funds | Fair Value | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total assets measured and recorded at fair value | 0 | 0 |
Earnout liability - current | Carrying Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities measured and recorded at fair value | 37,273 | 20,730 |
Earnout liability - current | Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities measured and recorded at fair value | 37,273 | 20,730 |
Earnout liability - current | Fair Value | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities measured and recorded at fair value | 0 | 0 |
Earnout liability - current | Fair Value | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities measured and recorded at fair value | 37,273 | 20,730 |
Earnout liability - non-current | Carrying Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities measured and recorded at fair value | 0 | 19,270 |
Earnout liability - non-current | Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities measured and recorded at fair value | 0 | 19,270 |
Earnout liability - non-current | Fair Value | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities measured and recorded at fair value | 0 | |
Earnout liability - non-current | Fair Value | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Total liabilities measured and recorded at fair value | $ 19,270 |
Fair Value Measurements (Earnou
Fair Value Measurements (Earnout Activity) (Details) - Earnout liability - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||
Beginning balance | $ 40,000 | $ 0 |
Recognition of earnout liability upon acquisition of GoMedigap on January 22, 2018 | 27,700 | |
Change in fair value | 24,079 | 12,300 |
Settlements | (26,806) | |
Ending balance | $ 37,273 | $ 40,000 |
Fair Value Measurements (Narrat
Fair Value Measurements (Narrative) (Details) - USD ($) $ in Thousands | Jan. 22, 2018 | Jan. 31, 2020 | Feb. 28, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Business Acquisition [Line Items] | |||||||
Earnout payment | $ 9,542 | $ 0 | $ 0 | ||||
GoMedigap | |||||||
Business Acquisition [Line Items] | |||||||
Earnout payment | $ 9,500 | ||||||
Earnout consideration (in shares) | 589,275 | 294,608 | |||||
Value of stock issued for acquisition | $ 5,595 | [1] | $ 17,300 | ||||
Subsequent Event | GoMedigap | |||||||
Business Acquisition [Line Items] | |||||||
Earnout payment | $ 8,800 | ||||||
Earnout consideration (in shares) | 294,608 | ||||||
Value of stock issued for acquisition | $ 28,500 | ||||||
[1] | The fair value of equity awards issued was determined based on the January 22, 2018 closing price of our common stock of $18.99 per share. |
Equity (Narrative) (Details)
Equity (Narrative) (Details) - USD ($) $ / shares in Units, $ in Millions | 1 Months Ended | 12 Months Ended | 69 Months Ended | ||||
Jan. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2019 | Jan. 22, 2019 | Jun. 12, 2014 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Shares authorized (in shares) | 110,000,000 | 110,000,000 | |||||
Preferred stock, par value per share (in usd per share) | $ 0.001 | $ 0.001 | $ 0.001 | ||||
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 | 10,000,000 | ||||
Preferred stock, shares outstanding (in shares) | 0 | 0 | 0 | ||||
Sale of stock, shares issued (in shares) | 2,800,000 | ||||||
Sale of stock, price per share (in usd per share) | $ 48.50 | ||||||
Net proceeds from sale of stock | $ 126.1 | ||||||
Shares available for grant (in shares) | 2,197,000 | 512,000 | 2,197,000 | 4,500,000 | |||
Vesting term for awards | 4 years | ||||||
Number of shares repurchased under share repurchase plan (in shares) | 0 | 0 | 0 | 10,700,000 | |||
Treasury shares that were previously surrendered by employees to satisfy tax withholdings (in shares) | 1,000,000 | ||||||
Treasury stock (in shares) | 11,616,000 | 11,426,000 | 11,616,000 | ||||
Incremental stock-based compensation expense | $ 0.5 | ||||||
Common stock options | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Expiration period for awards | 7 years | ||||||
Number of shares repurchased under share repurchase plan (in shares) | 0 | ||||||
Unrecognized stock-based compensation, options | $ 2.7 | $ 2.7 | |||||
Recognition period for unrecognized stock-based compensation expense | 2 years 2 months 12 days | ||||||
Common stock options | Period One | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Vesting term for awards | 4 years | ||||||
Vesting percent | 25.00% | ||||||
Common stock options | Period Two | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Vesting term for awards | 1 year | ||||||
Vesting percent | 2.08% | ||||||
Restricted stock units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Recognition period for unrecognized stock-based compensation expense | 2 years 9 months 18 days | ||||||
Unrecognized stock-based compensation, restricted stock units | $ 65.5 | $ 65.5 | |||||
Restricted stock units | Period One | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Vesting term for awards | 4 years | ||||||
Vesting percent | 25.00% | ||||||
Restricted stock units | Period Two | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Vesting term for awards | 1 year | ||||||
Vesting percent | 25.00% | ||||||
Market based restricted stock units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Performance period | 4 years | ||||||
Public Allotment | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Sale of stock, shares issued (in shares) | 2,400,000 | ||||||
Over-Allotment | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Sale of stock, shares issued (in shares) | 400,000 |
Equity (Schedule of Shares Rese
Equity (Schedule of Shares Reserved) (Details) - shares | Dec. 31, 2019 | Dec. 31, 2018 | Jun. 12, 2014 |
Stockholders' Equity Note [Abstract] | |||
Stock options issued and outstanding (in shares) | 649,000 | 1,005,000 | |
Restricted stock units issued and outstanding (in shares) | 2,201,000 | 1,869,000 | |
Shares available for grant (in shares) | 2,197,000 | 512,000 | 4,500,000 |
Total shares reserved (in shares) | 5,047,000 | 3,386,000 |
Equity (Schedule of Stock Plan
Equity (Schedule of Stock Plan Activity) (Details) shares in Thousands | 12 Months Ended | |
Dec. 31, 2019shares | ||
Share-based Compensation Arrangement by Share-based Payment Award, Movement in Shares Available for Grant [Roll Forward] | ||
Beginning balance (in shares) | 512 | |
Ending balance (in shares) | 2,197 | |
2014 Equity Incentive Plan | ||
Share-based Compensation Arrangement by Share-based Payment Award, Movement in Shares Available for Grant [Roll Forward] | ||
Beginning balance (in shares) | 512 | [1] |
Additional shares authorized (in shares) | 2,500 | [2] |
Restricted stock units granted (in shares) | (970) | [3] |
Options granted (in shares) | (19) | [4] |
Restricted stock units cancelled (in shares) | 124 | [2] |
Options cancelled (in shares) | 50 | |
Ending balance (in shares) | 2,197 | |
[1] | Shares available for grant do not include treasury stock shares that could be granted if we determined to do so. | |
[2] | Includes cancelled restricted stock units with service, performance-based or market-based vesting criteria. | |
[3] | Includes grants of restricted stock units with service, performance-based or market-based vesting criteria. | |
[4] | Includes grants of stock options with service, performance-based or market-based vesting criteria. |
Equity (Schedule of Option Acti
Equity (Schedule of Option Activity Under Stock Plans) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Number of Stock Options | ||||
Outstanding as of December 31, 2018 (in shares) | 1,005 | |||
Outstanding as of December 31, 2019 (in shares) | 649 | 1,005 | ||
Common stock options | ||||
Number of Stock Options | ||||
Outstanding as of December 31, 2018 (in shares) | [1] | 1,005 | ||
Granted (in shares) | [1] | 19 | ||
Exercised (in shares) | [1] | (319) | ||
Cancelled (in shares) | [1] | (56) | ||
Outstanding as of December 31, 2019 (in shares) | [1] | 649 | 1,005 | |
Vested and expected to vest at December 31, 2019 (in shares) | [1] | 631 | ||
Exercisable at December 31, 2019 (in shares) | [1] | 428 | ||
Weighted Average Exercise Price | ||||
Outstanding as of December 31, 2018, weighted average exercise price (in usd per share) | $ 18.34 | |||
Granted, weighted average exercise price (in usd per share) | 63.54 | |||
Exercised, weighted average exercise price (in usd per share) | 17.45 | |||
Cancelled, weighted average exercise price (in usd per share) | 24.71 | |||
Outstanding as of December 31, 2019, weighted average exercise price (in usd per share) | 19.57 | $ 18.34 | ||
Vested and expected to vest at December 31, 2019, weighted average exercise price (in usd per share) | 19.32 | |||
Exercisable at December 31, 2019, weighted average exercise price (in usd per share) | $ 16.67 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | ||||
Weighted-average remaining contractual life (years), balance outstanding | 4 years 4 months 24 days | 5 years | ||
Weighted-average remaining contractual life (years), vested and expected to Vest | 4 years 3 months 18 days | |||
Weighted-average remaining contractual life (years), exercisable | 3 years 10 months 24 days | |||
Aggregate intrinsic value, balance outstanding | [2] | $ 49,661 | $ 20,226 | |
Aggregate intrinsic value, vested and expected to vest | [2] | 48,404 | ||
Aggregate intrinsic value, exercisable | [2] | $ 33,995 | ||
Weighted average fair value of options granted (in usd per share) | $ 33.19 | $ 12.78 | $ 9.03 | |
Total fair value of options vested | $ 2,924 | $ 2,263 | $ 799 | |
Intrinsic value of options exercised | $ 19,890 | $ 1,461 | $ 430 | |
[1] | Includes certain stock options with service, performance-based or market-based vesting criteria. | |||
[2] | The aggregate intrinsic value is calculated as the product between eHealth’s closing stock price as of December 31, 2019 and 2018 at the exercise price of in-the-money options as of those dates. |
Equity (Schedule of Restricted
Equity (Schedule of Restricted Stock Unit Activity Under Stock Plans) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | ||
Number of Restricted Stock Units | |||
Unvested beginning balance (in shares) | 1,869 | ||
Unvested ending balance (in shares) | 2,201 | 1,869 | |
Restricted stock units | |||
Number of Restricted Stock Units | |||
Unvested beginning balance (in shares) | [1] | 1,869 | |
Granted (in shares) | [1] | 970 | |
Vested (in shares) | [1] | (514) | |
Cancelled (in shares) | [1] | (124) | |
Unvested ending balance (in shares) | [1] | 2,201 | 1,869 |
Weighted-Average Grant Date Fair Value | |||
Unvested beginning balance, weighted-average grant date fair value (in usd per share) | $ 16.95 | ||
Granted (in usd per share) | 17.96 | ||
Vested (in usd per share) | 17.01 | ||
Cancelled (in usd per share) | 31.50 | ||
Unvested ending balance, weighted-average grant date fair value (in usd per share) | $ 39.08 | $ 16.95 | |
Weighted-Average Remaining Service Period | 7 years 2 months 12 days | 4 years 9 months 18 days | |
Aggregate Intrinsic Value | [2] | $ 211,443 | $ 71,816 |
[1] | Includes certain restricted stock units with service, performance-based or market-based vesting criteria. | ||
[2] | The aggregate intrinsic value is calculated as the difference of our closing stock price as of December 31, 2019 and 2018 multiplied by the number of restricted stock units outstanding as of December 31, 2019 and 2018 |
Equity (Schedule of Fair Value
Equity (Schedule of Fair Value of Stock Options, Valuation Assumptions) (Details) - $ / shares | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Common stock options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected term | 4 years 3 months 18 days | 4 years 3 months 18 days | 4 years 3 months 18 days |
Expected volatility | 65.30% | 68.30% | 69.80% |
Expected dividend yield | 0.00% | 0.00% | 0.00% |
Risk-free interest rate | 2.10% | 2.70% | 1.80% |
Market-based options and restricted stock units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected term | 1 year 4 months 24 days | 1 year 7 months 6 days | 1 year 7 months 6 days |
Expected volatility | 57.80% | 69.80% | 70.90% |
Expected dividend yield | 0.00% | 0.00% | 0.00% |
Risk-free interest rate | 2.40% | 2.50% | 1.70% |
Weighted average grant date fair value (in usd per share) | $ 58.16 | $ 13.48 | $ 9.42 |
Equity (Schedule of Stock-Based
Equity (Schedule of Stock-Based Compensation Expense) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total stock-based compensation expense | $ 22,570 | $ 12,540 | $ 9,694 |
Common stock options | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total stock-based compensation expense | 2,215 | 1,991 | 1,863 |
Restricted stock units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total stock-based compensation expense | 20,355 | 10,549 | 7,831 |
Marketing and advertising | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total stock-based compensation expense | 4,230 | 1,974 | 1,033 |
Customer care and enrollment | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total stock-based compensation expense | 1,451 | 816 | 418 |
Technology and content | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total stock-based compensation expense | 3,611 | 1,675 | 1,410 |
General and administrative | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total stock-based compensation expense | 13,278 | 7,824 | 6,833 |
Restructuring charges | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total stock-based compensation expense | $ 0 | $ 251 | $ 0 |
Net Income Per Share (Schedule
Net Income Per Share (Schedule of Computation of Basic and Diluted Net Income Per Share) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2019 | [1] | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Basic | ||||||||||||
Net income | $ 88,824 | $ (11,024) | $ (5,754) | $ (5,159) | $ 26,072 | $ (8,972) | $ (12,014) | $ (4,845) | $ 66,887 | $ 241 | $ 25,426 | |
Shares used in per share calculation - basic (in shares) | 23,075 | 19,294 | 18,512 | |||||||||
Net Income per share - basic (in usd per share) | $ 3.74 | $ (0.47) | $ (0.25) | $ (0.24) | $ 1.32 | $ (0.47) | $ (0.63) | $ (0.26) | $ 2.90 | $ 0.01 | $ 1.37 | |
Diluted | ||||||||||||
Dilutive effect of common stock (in shares) | 1,464 | 1,115 | 535 | |||||||||
Total common stock shares used in per share calculation (in shares) | 24,539 | 20,409 | 19,047 | |||||||||
Net Income per share - diluted (in usd per share) | $ 3.58 | $ (0.47) | $ (0.25) | $ (0.24) | $ 1.25 | $ (0.47) | $ (0.63) | $ (0.26) | $ 2.73 | $ 0.01 | $ 1.33 | |
[1] | See Note 2 – Revenue for details regarding the change in estimate in the fourth quarter of 2019. |
Net Income Per Share (Schedul_2
Net Income Per Share (Schedule of Anti-Dilutive Shares Excluded from Computation Of Net Income Per Share) (Details) - shares shares in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Total (in shares) | 52 | 304 | 2,204 |
Common stock options | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Total (in shares) | 11 | 291 | 908 |
Restricted stock units | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | |||
Total (in shares) | 41 | 13 | 1,296 |
Commitments and Contingencies_2
Commitments and Contingencies (Narrative) (Details) $ in Millions | Jul. 01, 2019plaintiff | Dec. 31, 2019USD ($) |
Loss Contingencies [Line Items] | ||
Loss contingency accrual | $ | $ 1.2 | |
Service and licensing agreement term | 3 years | |
LeVias Compliant | ||
Loss Contingencies [Line Items] | ||
Number of plaintiffs | plaintiff | 2 |
Commitments and Contingencies_3
Commitments and Contingencies (Schedule of Future Minimum Obligations) (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Operating Lease Obligations | |
2020 | $ 7,040 |
2021 | 6,529 |
2022 | 5,266 |
2023 | 6,103 |
2024 | 5,909 |
Thereafter | 21,983 |
Total | 52,830 |
Service and Licensing Obligations | |
2020 | 3,073 |
2021 | 1,825 |
2022 | 692 |
2023 | 444 |
2024 | 229 |
Thereafter | 0 |
Total | 6,263 |
Total Obligations | |
2020 | 10,113 |
2021 | 8,354 |
2022 | 5,958 |
2023 | 6,547 |
2024 | 6,138 |
Thereafter | 21,983 |
Total | $ 59,093 |
Segment and Geographic Inform_3
Segment and Geographic Information (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2019 | [1] | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Segment Reporting Information [Line Items] | ||||||||||||
Total revenue | $ 301,748,000 | $ 69,913,000 | $ 65,767,000 | $ 68,773,000 | $ 134,917,000 | $ 40,751,000 | $ 32,657,000 | $ 43,070,000 | $ 506,201,000 | $ 251,395,000 | $ 190,706,000 | |
Stock-based compensation expense | (22,570,000) | (12,289,000) | (9,694,000) | |||||||||
Depreciation and amortization | (2,983,000) | (2,479,000) | (2,837,000) | |||||||||
Change in fair value of earnout liability | (24,079,000) | (12,300,000) | 0 | |||||||||
Restructuring charge | 0 | (1,865,000) | 0 | |||||||||
Acquisition costs | 0 | (76,000) | (621,000) | |||||||||
Amortization of intangible assets | (2,187,000) | (2,091,000) | (1,040,000) | |||||||||
Other income, net | 2,090,000 | 755,000 | 1,182,000 | |||||||||
Income (loss) before provision (benefit) for income taxes | 83,499,000 | 3,306,000 | (8,270,000) | |||||||||
Medicare | ||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||
Total revenue | 411,208,000 | 192,258,000 | 135,010,000 | |||||||||
Individual, Family and Small Business | ||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||
Total revenue | 55,468,000 | 34,953,000 | 41,873,000 | |||||||||
Operating Segments | ||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||
Total revenue | 506,201,000 | 251,395,000 | 190,706,000 | |||||||||
Segment profit (loss) | 178,602,000 | 66,647,000 | 31,710,000 | |||||||||
Operating Segments | Medicare | ||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||
Total revenue | 446,961,000 | 210,570,000 | 142,448,000 | |||||||||
Segment profit (loss) | 155,234,000 | 60,844,000 | 22,137,000 | |||||||||
Operating Segments | Individual, Family and Small Business | ||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||
Total revenue | 59,240,000 | 40,825,000 | 48,258,000 | |||||||||
Segment profit (loss) | 23,368,000 | 5,803,000 | 9,573,000 | |||||||||
Corporate | ||||||||||||
Segment Reporting Information [Line Items] | ||||||||||||
Segment profit (loss) | $ (45,374,000) | $ (32,996,000) | $ (26,970,000) | |||||||||
[1] | See Note 2 – Revenue for details regarding the change in estimate in the fourth quarter of 2019. |
Segment and Geographic Inform_4
Segment and Geographic Information (Schedule Of Long-Lived Assets By Geographical Area) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 |
Segment Reporting Information [Line Items] | ||
Total | $ 64,879 | $ 18,727 |
United States | ||
Segment Reporting Information [Line Items] | ||
Total | 64,408 | 18,228 |
China | ||
Segment Reporting Information [Line Items] | ||
Total | $ 471 | $ 499 |
Segment and Geographic Inform_5
Segment and Geographic Information (Schedule of Revenue by Major Customers) (Details) - Customer Concentration Risk - Revenue from Contract with Customer | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | ||
Humana | ||||
Revenue, Major Customer [Line Items] | ||||
Concentration risk, percentage | 26.00% | 22.00% | 20.00% | |
UnitedHealthcare | ||||
Revenue, Major Customer [Line Items] | ||||
Concentration risk, percentage | [1] | 19.00% | 19.00% | 23.00% |
Aetna | ||||
Revenue, Major Customer [Line Items] | ||||
Concentration risk, percentage | [2] | 17.00% | 14.00% | 10.00% |
[1] | UnitedHealthcare also includes other carriers owned by UnitedHealthcare. | |||
[2] | Aetna includes other carriers owned by Aetna. |
Restructuring (Details)
Restructuring (Details) | 1 Months Ended | 12 Months Ended | ||
Feb. 28, 2018employee | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | |
Restructuring Cost and Reserve [Line Items] | ||||
Positions eliminated | employee | 110 | |||
Percentage of total workforce | 10.00% | |||
Restructuring Reserve [Roll Forward] | ||||
Charges | $ 0 | $ 1,865,000 | $ 0 | |
Cash Restructuring Charges | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning balance | 0 | 0 | ||
Charges | 1,605,000 | |||
Payments | (1,605,000) | |||
Ending balance | 0 | 0 | 0 | |
Employee termination costs | ||||
Restructuring Reserve [Roll Forward] | ||||
Charges | 1,605,000 | |||
Employee termination costs | Cash Restructuring Charges | ||||
Restructuring Reserve [Roll Forward] | ||||
Beginning balance | $ 0 | 0 | ||
Charges | 1,605,000 | |||
Payments | (1,605,000) | |||
Ending balance | 0 | $ 0 | ||
Non-cash employee termination costs - stock-based compensation | ||||
Restructuring Reserve [Roll Forward] | ||||
Charges | 251,000 | |||
Other restructuring related costs | ||||
Restructuring Reserve [Roll Forward] | ||||
Charges | $ 9,000 |
Leases (Narrative) (Details)
Leases (Narrative) (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||||||||||
Apr. 30, 2018USD ($)ft² | Jun. 30, 2019USD ($)ft² | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2017USD ($) | Nov. 01, 2022ft² | Aug. 31, 2019USD ($)ft² | Apr. 30, 2019ft²periods | Mar. 31, 2019ft² | Feb. 28, 2019ft² | Jan. 01, 2019USD ($) | Mar. 31, 2018USD ($)ft² | Mar. 31, 2012USD ($)ft² | ||
Lessee, Lease, Description [Line Items] | ||||||||||||||
Operating lease expense | $ 6,400 | |||||||||||||
Operating cash outflow from operating leases | 5,400 | |||||||||||||
Operating lease right-of-use assets | [1] | 36,621 | ||||||||||||
Operating lease liabilities | 39,064 | |||||||||||||
Acquired right-of-use asset | 40,600 | |||||||||||||
Future minimum lease payments | 52,830 | |||||||||||||
Leasehold improvements | $ 1,900 | |||||||||||||
Rent expense | $ 7,300 | |||||||||||||
Operating lease expense | $ 5,300 | $ 4,600 | ||||||||||||
Minimum | ||||||||||||||
Lessee, Lease, Description [Line Items] | ||||||||||||||
Lease term | 1 year | |||||||||||||
Maximum | ||||||||||||||
Lessee, Lease, Description [Line Items] | ||||||||||||||
Lease term | 10 years | |||||||||||||
Accounting Standards Update 2016-02 | ||||||||||||||
Lessee, Lease, Description [Line Items] | ||||||||||||||
Operating lease right-of-use assets | $ 23,300 | |||||||||||||
Operating lease liabilities | $ 24,600 | |||||||||||||
Indianapolis, Indiana | ||||||||||||||
Lessee, Lease, Description [Line Items] | ||||||||||||||
Increase in operating lease liability | $ 10,800 | |||||||||||||
Office space, square feet | ft² | 81,515 | |||||||||||||
Future minimum lease payments | $ 17,600 | |||||||||||||
Office space sublease, square feet | ft² | 56,276 | |||||||||||||
Gold River, California | ||||||||||||||
Lessee, Lease, Description [Line Items] | ||||||||||||||
Increase in operating lease, liability, office expansion | $ 1,100 | |||||||||||||
Operating lease liability, lease extension | 800 | |||||||||||||
Office space, square feet | ft² | 63,206 | 44,738 | ||||||||||||
Future minimum lease payments | 2,900 | |||||||||||||
Number of extension periods | periods | 1 | |||||||||||||
Extension term | 5 years | |||||||||||||
Salt Lake City, Utah | ||||||||||||||
Lessee, Lease, Description [Line Items] | ||||||||||||||
Increase in operating lease liability | 4,900 | |||||||||||||
Office space, square feet | ft² | 41,813 | 28,915 | ||||||||||||
Future minimum lease payments | 8,700 | |||||||||||||
Operating lease, term | 84 months | |||||||||||||
Santa Clara, California | ||||||||||||||
Lessee, Lease, Description [Line Items] | ||||||||||||||
Future minimum lease payments | 16,100 | |||||||||||||
Operating lease, term | 9 years | |||||||||||||
Austin, Texas | ||||||||||||||
Lessee, Lease, Description [Line Items] | ||||||||||||||
Office space, square feet | ft² | 26,878 | |||||||||||||
Future minimum lease payments | 4,100 | |||||||||||||
Operating lease, term | 90 months | |||||||||||||
Mountain View, California | ||||||||||||||
Lessee, Lease, Description [Line Items] | ||||||||||||||
Office space, square feet | ft² | 18,272 | |||||||||||||
Future minimum lease payments | $ 2,800 | |||||||||||||
Remaining lease term | 3 years 7 months 6 days | |||||||||||||
Sublease income | $ 1,100 | |||||||||||||
Washington, D.C. | ||||||||||||||
Lessee, Lease, Description [Line Items] | ||||||||||||||
Office space, square feet | ft² | 1,413 | |||||||||||||
Future minimum lease payments | $ 300 | |||||||||||||
Operating lease, term | 5 years 4 months 24 days | |||||||||||||
Sana Clara Office Building, Lease Two | Santa Clara, California | ||||||||||||||
Lessee, Lease, Description [Line Items] | ||||||||||||||
Office space, square feet | ft² | 45,657 | |||||||||||||
Santa Clara Office Building, Lease One | Santa Clara, California | ||||||||||||||
Lessee, Lease, Description [Line Items] | ||||||||||||||
Office space, square feet | ft² | 32,492 | |||||||||||||
Operating lease, term | 10 years 3 months 18 days | |||||||||||||
$0.3 Million Standby Letter Of Credit | Standby Letters of Credit | Santa Clara, California | ||||||||||||||
Lessee, Lease, Description [Line Items] | ||||||||||||||
Letter of credit, outstanding | $ 300 | |||||||||||||
$0.8 Million Standby Letter Of Credit | Standby Letters of Credit | Indianapolis, Indiana | ||||||||||||||
Lessee, Lease, Description [Line Items] | ||||||||||||||
Letter of credit, outstanding | $ 800 | |||||||||||||
$1.5 Million Standby Letter of Credit | Standby Letters of Credit | Santa Clara, California | ||||||||||||||
Lessee, Lease, Description [Line Items] | ||||||||||||||
Letter of credit, outstanding | $ 1,500 | |||||||||||||
Reduction of letter of credit amount, percentage | 20.00% | |||||||||||||
Reduction of letter of credit amount, sixth year percentage | 8.00% | |||||||||||||
$0.6 Million Standby Letter Of Credit | Standby Letters of Credit | Austin, Texas | ||||||||||||||
Lessee, Lease, Description [Line Items] | ||||||||||||||
Letter of credit, outstanding | $ 600 | |||||||||||||
$0.1 Million Standby Letter Of Credit | Standby Letters of Credit | Mountain View, California | ||||||||||||||
Lessee, Lease, Description [Line Items] | ||||||||||||||
Letter of credit, outstanding | $ 100 | |||||||||||||
Scenario, Forecast | Indianapolis, Indiana | ||||||||||||||
Lessee, Lease, Description [Line Items] | ||||||||||||||
Office space, square feet | ft² | 25,239 | |||||||||||||
[1] | Reflects the impact from the adoption of ASC 842 on January 1, 2019. See Note 11 – Leases for details. |
Leases (Supplemental Informatio
Leases (Supplemental Information) (Details) $ in Thousands | Dec. 31, 2019USD ($) | |
Leases [Abstract] | ||
Operating lease right-of-use assets | $ 36,621 | [1] |
Operating lease liabilities | $ 39,064 | |
Weighted-average remaining lease term of operating leases | 7 years 7 months 6 days | |
Weighted-average discount rate used to recognize operating lease right-of-use-assets | 5.90% | [2] |
[1] | Reflects the impact from the adoption of ASC 842 on January 1, 2019. See Note 11 – Leases for details. | |
[2] | As our leases do not provide an implicit rate of interest, we use our incremental borrowing rate based on the information available at commencement date or remeasurement date in determining the present value of lease payments. |
Leases (Operating Lease Maturit
Leases (Operating Lease Maturities) (Details) $ in Thousands | Dec. 31, 2019USD ($) |
Leases [Abstract] | |
2020 | $ 7,040 |
2021 | 6,529 |
2022 | 5,266 |
2023 | 6,103 |
2024 | 5,909 |
Thereafter | 21,983 |
Total | 52,830 |
Less imputed interest | (13,766) |
Total | $ 39,064 |
Debt (Details)
Debt (Details) - USD ($) | Dec. 20, 2019 | Sep. 17, 2018 | Jan. 31, 2019 | Dec. 31, 2019 | Dec. 31, 2018 |
Line of Credit Facility [Line Items] | |||||
Debt issuance costs - non-current | $ 1,149,000 | $ 1,099,000 | |||
Unamortized issuance costs | 1,100,000 | ||||
Revolving Credit Facility | |||||
Line of Credit Facility [Line Items] | |||||
Borrowing capacity | $ 40,000,000 | ||||
Maximum borrowing capacity | $ 75,000,000 | $ 40,000,000 | |||
Commitment fee percentage | 0.50% | ||||
Facility fee percentage | 0.50% | 1.75% | |||
Line of credit facility, covenant, minimum cash and cash equivalents | $ 6,000,000 | $ 6,000,000 | |||
Line of credit facility, covenant, maximum cash and cash equivalents | 11,300,000 | ||||
Line of credit facility, covenant, minimum liquidity | 10,000,000 | ||||
Line of credit facility, maximum liquidity | $ 18,800,000 | ||||
Debt issuance costs - non-current | 1,200,000 | 1,200,000 | |||
Borrowings under line of credit | $ 0 | $ 5,000,000 | |||
Repayments of debt | $ 5,000,000 | ||||
Letter of Credit | |||||
Line of Credit Facility [Line Items] | |||||
Borrowing capacity | $ 5,000,000 | ||||
Eligible Commissions Receivables, Preceding Three Months | Revolving Credit Facility | |||||
Line of Credit Facility [Line Items] | |||||
Borrowing base percentage | 80.00% | ||||
Eligible Commissions Receivables, Succeeding Three Months | Revolving Credit Facility | |||||
Line of Credit Facility [Line Items] | |||||
Borrowing base percentage | 80.00% | ||||
Eligible Commissions Receivables, Succeeding Six Months | Revolving Credit Facility | |||||
Line of Credit Facility [Line Items] | |||||
Borrowing base percentage | 50.00% | ||||
Credit Agreement Amendment | Revolving Credit Facility | |||||
Line of Credit Facility [Line Items] | |||||
Debt issuance costs - non-current | $ 500,000 |
Income Taxes (Schedule of Compo
Income Taxes (Schedule of Components of Pre-Tax Income) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Income Tax Disclosure [Abstract] | |||
United States | $ 82,391 | $ 2,458 | $ (9,242) |
Foreign | 1,108 | 848 | 972 |
Income (loss) before provision (benefit) for income taxes | $ 83,499 | $ 3,306 | $ (8,270) |
Income Taxes (Schedule of Curre
Income Taxes (Schedule of Current and Deferred Income Taxes) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Current: | |||
Federal | $ 0 | $ 5 | $ (275) |
State | 75 | 48 | (1,433) |
Foreign | 326 | 213 | 179 |
Total current | 401 | 266 | (1,529) |
Deferred: | |||
Federal | 13,594 | 165 | (28,161) |
State | 2,635 | 2,648 | (3,992) |
Foreign | (18) | (14) | (14) |
Total deferred | 16,211 | 2,799 | (32,167) |
Provision (benefit) for income taxes | $ 16,612 | $ 3,065 | $ (33,696) |
Income Taxes (Narrative) (Detai
Income Taxes (Narrative) (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income Tax Disclosure [Line Items] | ||||
Income before tax | $ 83,499 | $ 3,306 | $ (8,270) | |
Income tax expense | $ 16,612 | $ 3,065 | $ (33,696) | |
Effective tax rate | 19.90% | 92.70% | 407.60% | |
Valuation allowance | $ 2,407 | $ 2,407 | $ 0 | $ 0 |
Unrecognized tax benefits | 4,709 | 3,740 | $ 3,096 | $ 5,253 |
Unrecognized tax benefits that would impact effective tax rate | 4,200 | $ 3,300 | ||
Federal Tax Authority | ||||
Income Tax Disclosure [Line Items] | ||||
Operating loss carry forwards | 238,300 | |||
Tax credit carryforward | 5,200 | |||
State Tax Jurisdiction | ||||
Income Tax Disclosure [Line Items] | ||||
Operating loss carry forwards | 168,100 | |||
Tax credit carryforward | $ 6,100 |
Income Taxes (Income Tax Rate R
Income Taxes (Income Tax Rate Reconciliation Schedule) (Details) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Effective Income Tax Rate Reconciliation, Percent [Abstract] | |||
Statutory rate | 21.00% | 21.00% | 35.00% |
State income taxes, net of federal benefit | 2.60% | (7.20%) | 31.70% |
Stock-based compensation shortfalls (windfalls), net | (7.00%) | (29.40%) | 1.90% |
Non-deductible stock-based compensation | 2.50% | 21.60% | (9.70%) |
Non-deductible lobbying expenses | 1.00% | 15.20% | (9.10%) |
Research and development credits | (0.90%) | (17.10%) | (1.50%) |
Changes in valuation allowance | 0.00% | 72.80% | 0.00% |
Tax reform - tax rate change | 0.00% | 0.00% | 355.90% |
Foreign income tax and income inclusion | 0.10% | 6.80% | 2.70% |
Non-deductible parking expense | 0.20% | 3.10% | 0.00% |
Other permanent differences | 0.40% | 5.90% | 0.70% |
Effective tax rate | 19.90% | 92.70% | 407.60% |
Income Taxes (Schedule of Defer
Income Taxes (Schedule of Deferred Tax Assets, Net) (Details) - USD ($) $ in Thousands | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | Dec. 31, 2016 |
Deferred tax assets: | ||||
Net operating losses | $ 60,023 | $ 22,181 | ||
Accruals and reserves | 4,143 | 3,370 | ||
Operating lease liabilities | 9,471 | |||
Intangible assets | 6,306 | 2,269 | ||
Tax credits | 5,818 | 4,508 | ||
Stock-based compensation | 2,835 | 2,388 | ||
Fixed assets | 203 | 61 | ||
Other | 187 | 250 | ||
Total deferred tax assets | 88,986 | 35,027 | ||
Valuation allowance | (2,407) | (2,407) | $ 0 | $ 0 |
Total deferred tax assets net of valuation allowance | 86,579 | 32,620 | ||
Deferred tax liabilities: | ||||
Commissions receivable | (141,566) | (80,289) | ||
Right-of-use assets | (8,879) | |||
Total deferred tax liabilities | (150,445) | (80,289) | ||
Net deferred tax liabilities | $ (63,866) | $ (47,669) |
Income Taxes (Changes in Valuat
Income Taxes (Changes in Valuation Allowance) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Changes In Deferred Tax Asset, Valuation Allowance [Roll Forward] | |||
Balance at beginning of year | $ 2,407 | $ 0 | $ 0 |
Provision for income taxes | 0 | 2,407 | 0 |
Balance at end of year | $ 2,407 | $ 2,407 | $ 0 |
Income Taxes (Reconciliation of
Income Taxes (Reconciliation of Unrecognized Tax Benefits Schedule) (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |||
Unrecognized tax benefits, beginning balance | $ 3,740 | $ 3,096 | $ 5,253 |
Decrease based on tax positions related to the prior year | (862) | ||
Lapse of statute of limitations | (5) | (1,637) | |
Additions based on tax positions related to the current year | 969 | 70 | 342 |
Increase based on tax positions related to the prior year | 579 | ||
Unrecognized tax benefits, ending balance | $ 4,709 | $ 3,740 | $ 3,096 |
Selected Quarterly Financial _3
Selected Quarterly Financial Data (Unaudited) (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 12 Months Ended | ||||||||||
Dec. 31, 2019 | [1] | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Selected Quarterly Financial Information [Abstract] | ||||||||||||
Revenue | $ 301,748 | $ 69,913 | $ 65,767 | $ 68,773 | $ 134,917 | $ 40,751 | $ 32,657 | $ 43,070 | $ 506,201 | $ 251,395 | $ 190,706 | |
Income (loss) from operations | 123,144 | (20,241) | (12,311) | (9,183) | 41,645 | (15,454) | (16,920) | (6,720) | 81,409 | 2,551 | (9,452) | |
Net income (loss) | $ 88,824 | $ (11,024) | $ (5,754) | $ (5,159) | $ 26,072 | $ (8,972) | $ (12,014) | $ (4,845) | $ 66,887 | $ 241 | $ 25,426 | |
Net income (loss) per share: | ||||||||||||
Basic (in usd per share) | $ 3.74 | $ (0.47) | $ (0.25) | $ (0.24) | $ 1.32 | $ (0.47) | $ (0.63) | $ (0.26) | $ 2.90 | $ 0.01 | $ 1.37 | |
Diluted (in usd per share) | $ 3.58 | $ (0.47) | $ (0.25) | $ (0.24) | $ 1.25 | $ (0.47) | $ (0.63) | $ (0.26) | $ 2.73 | $ 0.01 | $ 1.33 | |
[1] | See Note 2 – Revenue for details regarding the change in estimate in the fourth quarter of 2019. |