Document_and_Entity_Informatio
Document and Entity Information | 9 Months Ended | ||
Sep. 30, 2013 | Nov. 07, 2013 | Nov. 07, 2013 | |
Class A common stock | Class B common stock | ||
Entity Information [Line Items] | ' | ' | ' |
Document Type | '10-Q | ' | ' |
Amendment Flag | 'false | ' | ' |
Document Period End Date | 30-Sep-13 | ' | ' |
Document Fiscal Year Focus | '2013 | ' | ' |
Document Fiscal Period Focus | 'Q3 | ' | ' |
Trading Symbol | 'HIIQ | ' | ' |
Entity Registrant Name | 'Health Insurance Innovations, Inc. | ' | ' |
Entity Central Index Key | '0001561387 | ' | ' |
Current Fiscal Year End Date | '--12-31 | ' | ' |
Entity Filer Category | 'Smaller Reporting Company | ' | ' |
Entity Common Stock, Shares Outstanding | ' | 5,265,321 | 8,566,667 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | $19,444 | $750 |
Cash held on behalf of others | 4,072 | 3,839 |
Short-term investments | 21,414 | ' |
Accounts receivable | 974 | 861 |
Advanced commissions | 1,397 | 297 |
Prepaid expenses and other current assets | 429 | 217 |
Total current assets | 47,730 | 5,964 |
Property and equipment, net of accumulated depreciation | 383 | 213 |
Capitalized offering costs | ' | 1,819 |
Goodwill | 18,014 | 5,906 |
Intangible assets, net of accumulated amortization | 5,656 | 3,959 |
Other assets | 30 | 100 |
Total assets | 71,813 | 17,961 |
Current liabilities: | ' | ' |
Accounts payable and accrued expenses | 1,537 | 2,062 |
Carriers and vendors payable | 2,877 | 2,790 |
Commissions payable | 1,166 | 1,533 |
Current portion of long-term debt | ' | 813 |
Deferred revenue | 863 | 268 |
Income taxes payable | 74 | ' |
Due to member of Health Plan Intermediaries, LLC | ' | 773 |
Other current liabilities | 13 | 77 |
Total current liabilities | 8,753 | 8,471 |
Long-term debt, less current portion | ' | 2,481 |
Due to related parties pursuant to tax receivable agreement | 374 | ' |
Other liabilities | 60 | 45 |
Total liabilities | 12,565 | 11,623 |
Commitments and contingencies | ' | ' |
Stockholdersb/memberbs equity: | ' | ' |
Preferred stock (par value $0.001 per share, 5,000,000 shares authorized; 0 shares issued and outstanding) | ' | ' |
Additional paid-in capital | 26,837 | ' |
Treasury stock, at cost (32,477 shares) | -377 | ' |
Accumulated deficit | -3,684 | ' |
Memberbs equity of Health Plan Intermediaries, LLC | ' | 6,335 |
Noncontrolling interests | 36,458 | 3 |
Total stockholdersb/memberbs equity | 59,248 | 6,338 |
Total liabilities and stockholdersb/memberbs equity | 71,813 | 17,961 |
Noncompete Agreements | ' | ' |
Current liabilities: | ' | ' |
Current portion of noncompete obligation | 161 | 155 |
Noncompete obligation | 504 | 626 |
Current | ' | ' |
Current liabilities: | ' | ' |
Contingent acquisition consideration | 2,062 | ' |
Noncurrent | ' | ' |
Current liabilities: | ' | ' |
Contingent acquisition consideration | 2,874 | ' |
Class A common stock | ' | ' |
Stockholdersb/memberbs equity: | ' | ' |
Common stock | 5 | ' |
Total stockholdersb/memberbs equity | 5 | ' |
Class B common stock | ' | ' |
Stockholdersb/memberbs equity: | ' | ' |
Common stock | 9 | ' |
Total stockholdersb/memberbs equity | $9 | ' |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (USD $) | Sep. 30, 2013 |
Preferred stock, shares authorized | 5,000,000 |
Preferred stock, par value | $0.00 |
Preferred stock, shares issued | 0 |
Preferred stock, shares outstanding | 0 |
Treasury stock, shares | 32,477 |
Class A common stock | ' |
Common stock, shares authorized | 100,000,000 |
Common stock, par value | $0.00 |
Common stock, shares issued | 5,309,594 |
Common stock, shares outstanding | 5,277,117 |
Class B common stock | ' |
Common stock, shares authorized | 20,000,000 |
Common stock, par value | $0.00 |
Common stock, shares issued | 8,566,667 |
Common stock, shares outstanding | 8,566,667 |
Consolidated_Statements_Of_Ope
Consolidated Statements Of Operations (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Revenues (premium equivalents of $25,977 and $20,792 for the three months ended September 30, 2013 and 2012, respectively, and $72,256 and $54,549 for the nine months ended September 30, 2013 and 2012, respectively) | $14,749 | $11,644 | $40,818 | $30,102 |
Third-party commissions | 7,928 | 7,643 | 24,438 | 20,093 |
Credit cards and ACH fees | 313 | 270 | 861 | 693 |
Contract termination expense | ' | ' | 5,500 | ' |
Selling, general and administrative expenses | 6,348 | 2,552 | 16,010 | 5,786 |
Depreciation and amortization | 423 | 229 | 913 | 771 |
Total operating costs and expenses | 15,012 | 10,694 | 47,722 | 27,343 |
(Loss) income from operations | -263 | 950 | -6,904 | 2,759 |
Other expense (income): | ' | ' | ' | ' |
Interest (income) expense | -7 | 67 | 14 | 194 |
Other expense (income) | 53 | -11 | 437 | -21 |
Net (loss) income before income taxes | -309 | 894 | -7,355 | 2,586 |
(Benefit) provision for income taxes | -823 | ' | 472 | ' |
Net income (loss) | 514 | 894 | -7,827 | 2,586 |
Net income (loss) attributable to noncontrolling interests | 106 | -43 | -4,143 | -63 |
Net income (loss) attributable to Health Insurance Innovations, Inc. and Health Plan Intermediaries, LLC | $408 | $937 | ($3,684) | $2,649 |
Net income (loss) per share attributable to Health Insurance Innovations, Inc. | ' | ' | ' | ' |
Basic | $0.09 | ' | ($0.77) | ' |
Diluted | $0.08 | ' | ($0.77) | ' |
Weighted average Class A shares outstanding | ' | ' | ' | ' |
Basic | 4,795,736 | ' | 4,768,294 | ' |
Diluted | 4,861,336 | ' | 4,768,294 | ' |
Consolidated_Statements_Of_Ope1
Consolidated Statements Of Operations (Parenthetical) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Premium equivalent amount | $25,977 | $20,792 | $72,256 | $54,549 |
Consolidated_Statements_of_Com
Consolidated Statements of Comprehensive Income (Loss) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Net income (loss) | $514 | $894 | ($7,827) | $2,586 |
Other comprehensive income: | ' | ' | ' | ' |
Unrealized gain on available-for-sale securities | 30 | ' | ' | ' |
Comprehensive income (loss) | 544 | 894 | -7,827 | 2,586 |
Less: Comprehensive income attributable to noncontrolling interests | 15 | ' | ' | ' |
Comprehensive income (loss) attributable to Health Insurance Innovations, Inc. and Health Plan Intermediaries, LLC. | $529 | $894 | ($7,827) | $2,586 |
Consolidated_Statements_of_Sto
Consolidated Statements of Stockholders'/Member's Equity (USD $) | Total | Class A common stock | Class B common stock | Noncontrolling Interests | Additional Paid-in Capital | Treasury Stock | Accumulated Deficit | Pre IPO | Pre IPO | Initial public offering | Initial public offering | Initial public offering | Initial public offering | Initial public offering | Initial public offering | Underwriters exercise of over-allotment option | Underwriters exercise of over-allotment option | Underwriters exercise of over-allotment option | Series B | Series B | Series B | Equity Compensation Plan | Equity Compensation Plan | Equity Compensation Plan |
USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | Health Plan Intermediaries, LLC and Subsidiaries | Noncontrolling Interests | USD ($) | Class A common stock | Class B common stock | Noncontrolling Interests | Additional Paid-in Capital | Additional Paid-in Capital | USD ($) | Class A common stock | Additional Paid-in Capital | USD ($) | Class B common stock | Noncontrolling Interests | USD ($) | Class A common stock | Additional Paid-in Capital | |
USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | Class A common stock | Class B common stock | USD ($) | USD ($) | USD ($) | |||||||||||||||
USD ($) | USD ($) | |||||||||||||||||||||||
Beginning balance at Dec. 31, 2011 | $6,996,000 | ' | ' | ' | ' | ' | ' | $6,996,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income (loss) | 3,260,000 | ' | ' | ' | ' | ' | ' | 3,349,000 | -89,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Contribution from minority partner | 92,000 | ' | ' | ' | ' | ' | ' | ' | 92,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Distributions | -4,010,000 | ' | ' | ' | ' | ' | ' | -4,010,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Ending balance at Dec. 31, 2012 | 6,338,000 | ' | ' | ' | ' | ' | ' | 6,335,000 | 3,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income (loss) | -259,000 | ' | ' | ' | ' | ' | ' | -248,000 | -11,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Contribution from minority partner | 10,000 | ' | ' | ' | ' | ' | ' | ' | 10,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Distributions | -171,000 | ' | ' | ' | ' | ' | ' | -171,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Ending balance at Feb. 11, 2013 | 5,918,000 | ' | ' | ' | ' | ' | ' | 5,916,000 | 2,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Effects of initial public offering and reorganization | ' | ' | ' | 5,918,000 | ' | ' | ' | -5,916,000 | -2,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Ending balance at Feb. 13, 2013 | 5,918,000 | ' | ' | 5,918,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Net income (loss) | -7,568,000 | ' | ' | -3,884,000 | ' | ' | -3,684,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Contribution from minority partner | 6,000 | ' | ' | 6,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Issuance of common stock | ' | ' | ' | ' | ' | ' | ' | ' | ' | 57,755,000 | 5,000 | 9,000 | 36,444,000 | 57,750,000 | -36,453,000 | 1,302,000 | ' | 1,302,000 | ' | ' | ' | ' | ' | ' |
Issuance of common stock, shares | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4,666,667 | 8,666,667 | ' | ' | ' | ' | 100,000 | ' | ' | ' | ' | ' | ' | ' |
Purchase of Series B Membership interests and exchange and cancellation of Class B common stock | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -1,302,000 | ' | -1,302,000 | ' | ' | ' |
Purchase of Series B Membership interests and exchange and cancellation of Class B common stock, shares | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -100,000 | ' | ' | ' | ' |
Issuance of Class A common stock under equity compensation plans | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4,276,000 | ' | 4,276,000 |
Issuance of Class A common stock under equity compensation plans, shares | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 542,927 | ' |
Acquisition of noncontrolling interest in consolidated subsidiary | -90,000 | ' | ' | -52,000 | -38,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Treasury Stock, Shares, Acquired | ' | -32,477 | ' | ' | ' | 32,477 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Purchases of treasury stock | -377,000 | ' | ' | ' | ' | -377,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Distributions | -672,000 | ' | ' | -672,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Ending balance at Sep. 30, 2013 | $59,248,000 | $5,000 | $9,000 | $36,458,000 | $26,837,000 | ($377,000) | ($3,684,000) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Ending balance, Shares at Sep. 30, 2013 | ' | 5,277,117 | 8,566,667 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (USD $) | 9 Months Ended | |
Sep. 30, 2013 | Sep. 30, 2012 | |
Operating activities: | ' | ' |
Net (loss) income | ($7,827,000) | $2,586,000 |
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities: | ' | ' |
Stock-based compensation | 4,276,000 | ' |
Depreciation and amortization | 913,000 | 771,000 |
Loss on extinguishment of debt | 71,000 | ' |
Amortization of deferred financing costs | 7,000 | 34,000 |
Fair value adjustments to contingent acquisition consideration | 64,000 | ' |
Changes in operating assets and liabilities: | ' | ' |
Increase in cash held on behalf of others | -233,000 | -541,000 |
Decrease (increase) in accounts receivable | 202,000 | -520,000 |
Increase in advanced commissions | -1,100,000 | -276,000 |
Decrease in gateway processor deposit | ' | 400,000 |
(Increase) decrease in prepaid expenses and other assets | -159,000 | 5,000 |
Increase in carriers and vendors payable | 87,000 | 722,000 |
(Decrease) increase in accounts payable, accrued expenses and other liabilities | -386,000 | 1,207,000 |
(Decrease) increase in commissions payable | -367,000 | 185,000 |
Increase in due to related parties pursuant to tax receivable agreement | 374,000 | ' |
Increase in deferred revenue | 595,000 | 196,000 |
Increase in income taxes payable | 74,000 | ' |
Decrease in amounts due to member of Health Plan Intermediaries, LLC | ' | -126,000 |
Net cash (used in) provided by operating activities | -3,409,000 | 4,643,000 |
Investing activities: | ' | ' |
Acquisitions of short-term investments, net | -21,414,000 | ' |
Business acquisition, net of cash acquired | -9,909,000 | ' |
Purchases of property and equipment | -113,000 | -118,000 |
Loans to distributors | -174,000 | -220,000 |
Proceeds from repayment of loans to distributors | 139,000 | 125,000 |
Payments for deposits | -9,000 | ' |
Net cash used in investing activities | -31,480,000 | -213,000 |
Financing activities: | ' | ' |
Repayments of notes payable | -54,000 | -10,000 |
Repayments of long-term debt | -3,294,000 | -573,000 |
Payments under noncompete obligation | -116,000 | ' |
Proceeds from note payable | ' | 100,000 |
Distributions to member of Health Plan Intermediaries, LLC | -1,617,000 | -2,763,000 |
Payments for equity issuance | -1,643,000 | -862,000 |
Purchase of treasury stock | -377,000 | ' |
Payments under capital leases | -2,000 | -8,000 |
Acquisition of noncontrolling interest in subsidiary | -90,000 | ' |
Contributions from noncontrolling interests | 16,000 | 50,000 |
Net cash provided by (used in) financing activities | 53,583,000 | -4,066,000 |
Net increase in cash and cash equivalents | 18,694,000 | 364,000 |
Cash and cash equivalents at beginning of period | 750,000 | 618,000 |
Cash and cash equivalents at end of period | 19,444,000 | 982,000 |
Supplemental Disclosure of non-cash investing activities: | ' | ' |
Contingent consideration for business acquisition | 4,937,000 | ' |
Purchase of insurance through premium financing agreement | ' | 21,000 |
Software | ' | ' |
Supplemental Disclosure of non-cash investing activities: | ' | ' |
Intangible assets acquired | ' | 45,000 |
Noncompete Agreements | ' | ' |
Supplemental Disclosure of non-cash investing activities: | ' | ' |
Intangible assets acquired | ' | 843,000 |
Class A common stock | ' | ' |
Financing activities: | ' | ' |
Issuance of Class A common stock in initial public offering, net of underwritersb discount and in underwriters' exercise of over-allotment option | 60,760,000 | ' |
Common Stock Issuance Over Allotment Option | Class A common stock | ' | ' |
Financing activities: | ' | ' |
Issuance of Class A common stock in initial public offering, net of underwritersb discount and in underwriters' exercise of over-allotment option | 1,302,000 | ' |
Series B | ' | ' |
Financing activities: | ' | ' |
Purchase of Series B Membership interests | ($1,302,000) | ' |
Organization_Basis_of_Presenta
Organization, Basis of Presentation and Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2013 | |
Organization, Basis of Presentation and Summary of Significant Accounting Policies | ' |
1. Organization, Basis of Presentation and Summary of Significant Accounting Policies | |
In this quarterly report, unless the context suggests otherwise, references in this report to the “Company,” “we,” “us” and “our” refer (1) prior to the February 13, 2013 initial public offering (“IPO”) of the Class A common stock of Health Insurance Innovations, Inc. and related transactions, to Health Plan Intermediaries, LLC (“HPI”) and its consolidated subsidiaries and (2) after our IPO and related transactions, to Health Insurance Innovations, Inc. and its consolidated subsidiaries. The terms “HII”, “HPIH” and “ICE” refer to the stand-alone entities Health Insurance Innovations, Inc., Health Plan Intermediaries Holdings, LLC, and Insurance Center for Excellence, LLC, respectively. HPIH and ICE are consolidated subsidiaries of HII. The term “Secured” refers to (a) prior to or at the time of their July 17, 2013 acquisition by us, Sunrise Health Plans, Inc., Sunrise Group Marketing, Inc. and Secured Software Solutions, Inc., collectively, and (b) following our July 17, 2013 acquisition, the entities described in (a) and the limited liability companies into which such entities were converted shortly following such acquisition. | |
Business Description and Organizational Structure of the Company | |
Our Business | |
We are a developer and administrator of affordable individual health insurance plans and supplemental services that are sold throughout the United States. Our main product, short-term medical (“STM”) insurance, is an alternative to traditional individual major medical plans and generally offers comparable benefits for qualifying individuals. We also offer guaranteed-issue hospital indemnity plans for individuals under the age of 65 and a variety of ancillary products that are frequently purchased together with the STM and hospital indemnity plans as supplements. We design and structure insurance products on behalf of our contracted insurance carrier companies, market them to individuals through a network of distributors, including Secured, a significant distributor which we acquired on July 17, 2013, as described in Note 2 below, and manage our relationships with our customers whom are referred to as “members,” through our customer service agents. Our sales are primarily executed online and offer real-time fulfillment through our proprietary web-based technology platform, through which we receive credit card and automated clearing house (“ACH”) payments directly from the members at the time of sale. In certain cases, premiums are collected by the distributor and remitted to us. The plans are underwritten by contracted insurance carrier companies, and we assume no underwriting or insurance risk. | |
Our History | |
Our business began operations in 2008, and historically we operated through HPI. In August 2008, Naylor Group Partners, LLC (“Naylor”) made a capital contribution to HPI in exchange for a 50% ownership interest in HPI. In September 2011, HPI purchased all of the units owned by Naylor for $5.3 million plus financing costs of $135,000. HPI financed a portion of the purchase price by entering into a loan agreement with a bank for $4.3 million. The remaining purchase price was funded with HPI cash and a contribution from Michael Kosloske (“Mr. Kosloske”), our Chairman, President and Chief Executive Officer. Following the purchase, Mr. Kosloske became the sole member of HPI. | |
Our Reorganization and the IPO | |
HII was incorporated in the State of Delaware on October 26, 2012 to facilitate the IPO and to become a holding company owning as its principal asset membership interests in HPIH. Since November 2012, we have operated our business through HPIH and its consolidated subsidiaries. See Note 6 for more information about the IPO. | |
In anticipation of the IPO, on November 7, 2012, HPI assigned the operating assets of our business through a series of transactions to HPIH, and HPIH assumed the operating liabilities of HPI. | |
Our Organizational Structure after the IPO | |
HII has two classes of outstanding capital stock: Class A common stock and Class B common stock. Class A shares represent 100% of the economic rights of the holders of all classes of our common stock to share in our distributions. Class B shares do not entitle their holders to any dividends paid by, or rights upon liquidation of, HII. Shares of our Class A common stock vote together with shares of our Class B common stock as a single class, except as otherwise required by law. Each share of our Class A common stock and our Class B common stock entitles its holder to one vote. As of September 30, 2013, Mr. Kosloske beneficially owns 61.9% of our outstanding Class A common stock and Class B common stock on a combined basis, which equals his combined economic interest in the Company, and has effective control over the outcome of votes on all matters requiring approval by our stockholders. | |
HPIH has two series of outstanding equity: Series A Membership Interests, which may only be issued to HII, as sole managing member, and Series B Membership Interests. The Series B Membership Interests are held by HPI and Health Plan Intermediaries Sub, LLC (“HPIS”), a subsidiary of HPI, and these entities are beneficially owned by Mr. Kosloske. As of September 30, 2013, (i) the Series A Membership Interests held by HII represent 38.1% of the outstanding membership interests, 38.1% of the economic interests and 100% of the voting interests in HPIH and (ii) the Series B Membership Interests held by the entities beneficially owned by Mr. Kosloske represent 61.9% of the outstanding membership interests, 61.9% of the economic interests and no voting interest in HPIH. | |
For greater detail regarding our organizational structure, our capitalization, the exchange agreement referenced below and related matters, see “Item 1. Business—Our History and the Reorganization of Our Corporate Structure” set forth in our annual report on Form 10-K filed with the Securities and Exchange Commission on April 1, 2013. | |
Exchange Agreement | |
On February 13, 2013, we entered into an exchange agreement (the “Exchange Agreement”) with the holders of Series B Membership Interests. Pursuant to and subject to the terms of the Exchange Agreement and the amended and restated limited liability company agreement of HPIH, holders of Series B Membership Interests, at any time and from time to time, may exchange one or more Series B Membership Interests, together with an equal number of shares of our Class B common stock, for shares of our Class A common stock on a one-for-one basis, subject to equitable adjustments for stock splits, stock dividends and reclassifications. In connection with each exchange, HPIH will cancel the delivered Series B Membership Interests and Class B common stock and issue to us Series A Membership Interests on a one-for-one basis. Thus, as holders exchange their Series B Membership Interests for Class A common stock, our interest in HPIH will increase. | |
Holders will not have the right to exchange Series B Membership Interests if we determine that such exchange would be prohibited by law or regulation or would violate other agreements to which we may be subject. We may impose additional restrictions on the exchange that we determine necessary or advisable so that HPIH is not treated as a “publicly traded partnership” for U.S. federal income tax purposes. If the Internal Revenue Service were to contend successfully that HPIH should be treated as a “publicly traded partnership” for U.S. federal income tax purposes, HPIH would be treated as a corporation for U.S. federal income tax purposes and thus would be subject to entity-level tax on its taxable income. | |
We and the exchanging holder will each generally bear our own expenses in connection with an exchange, except that, subject to a limited exception, we are required to pay any transfer taxes, stamp taxes or duties or other similar taxes in connection with such an exchange. | |
Tax Receivable Agreement | |
The purchase of Series B Membership Interests (together with an equal number of shares of our Class B common stock) with the net proceeds from the sale of shares reserved to cover over-allotments from the IPO, as well as subsequent exchanges of Series B Membership Interests (together with an equal number of shares of our Class B common stock, for shares of our Class A common stock) are expected to increase our tax basis in our share of HPIH’s tangible and intangible assets. These increases in tax basis are expected to increase our depreciation and amortization income tax deductions and create other tax benefits and therefore may reduce the amount of income tax that we would otherwise be required to pay in the future. | |
On February 13, 2013, we entered into a tax receivable agreement with the holders of Series B Membership Interests (currently HPI and HPIS, which are beneficially owned by Mr. Kosloske). The agreement requires us to pay to such holders 85% of the cash savings, if any, in U.S. federal, state and local income tax we realize (or are deemed to realize in the case of an early termination payment, a change in control or a material breach by us of our obligations under the tax receivable agreement) as a result of any possible future increases in tax basis described above and of certain other tax benefits related to entering into the tax receivable agreement, including tax benefits attributable to payments under the tax receivable agreement itself. This is HII’s obligation and not an obligation of HPIH. HII will benefit from the remaining 15% of any realized cash savings. For purposes of the tax receivable agreement, cash savings in income tax is computed by comparing our actual income tax liability with our hypothetical liability had we not been able to utilize the tax benefits subject to the tax receivable agreement itself. The tax receivable agreement became effective upon completion of the IPO and will remain in effect until all such tax benefits have been used or expired, unless HII exercises its right to terminate the tax receivable agreement for an amount based on the agreed payments remaining to be made under the agreement or HII breaches any of its material obligations under the tax receivable agreement in which case all obligations will generally be accelerated and due as if HII had exercised its right to terminate the agreement. Any potential future payments will be calculated using the market value of our Class A common stock at the time of the relevant exchange and prevailing tax rates in future years and will be dependent on us generating sufficient future taxable income to realize the benefit. Payments are generally due under the tax receivable agreement within a specified period of time following the filing of our tax return for the taxable year with respect to which payment of the obligation arises. For further information on the tax receivable agreement, see Note 14. | |
Basis of Presentation | |
The consolidated financial statements reflect the results of operations of HPI through the closing of the IPO on February 13, 2013, and HII subsequent to the IPO. Intercompany accounts and transactions have been eliminated in consolidation. | |
Our accompanying unaudited consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X of the Securities Exchange Act of 1934 and do not include all of the information and notes required by U.S. generally accepted accounting principles (“GAAP”) for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments and accruals) considered necessary for a fair presentation of consolidated financial position, results of operations and cash flows have been included. The consolidated balance sheet data for the year ended December 31, 2012 was derived from our audited financial statements, but does not include all the disclosures required by GAAP. For further information, refer to our Annual Report on Form 10-K for the year ended December 31, 2012, including the consolidated financial statements and accompanying notes. | |
Noncontrolling interests are included in the consolidated balance sheets as a component of stockholders’ equity that is not attributable to the equity of HII. We report separately the amounts of consolidated net income or loss attributable to us and noncontrolling interests. | |
As an “emerging growth company” as defined in the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), we intend to take advantage of certain temporary exemptions from various reporting requirements, including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act and reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements. We have also elected to delay the adoption of new and revised accounting standards until those standards would otherwise apply to nonpublic entities. Our financial statements may therefore not be comparable to those of companies that comply with such new or revised accounting standards. These exemptions will apply for a period of five years following the completion of our IPO although if the market value of our common stock that is held by non-affiliates exceeds $700 million as of any June 30 before that time, we would cease to be an emerging growth company as of the following December 31. | |
Reclassifications | |
Certain amounts in the prior year’s consolidated financial statements have been reclassified to conform to the current year presentation. | |
Use of Estimates | |
The preparation of the financial statements in conformity with GAAP requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements. These estimates also affect the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from those estimates. | |
Significant Accounting Policies | |
Except as discussed below, our accounting policies are described in Note 1, Organization, Basis of Presentation and Summary of Significant Accounting Policies, in each of our audited consolidated financial statements for the year ended December 31, 2012 on Form 10-K and our consolidated financial statements for the three and six months ended June 30, 2013 on Form 10-Q. | |
Recent Accounting Pronouncements | |
In the following summary of recent accounting pronouncements, all references to effective dates of Financial Accounting Standards Board (“FASB”) guidance relate to nonpublic entities. As noted above, we have elected to delay the adoption of new and revised accounting standards until those standards would otherwise apply to nonpublic companies under provisions of the JOBS Act. | |
In July 2013, the FASB issued guidance which states that an unrecognized tax benefit, or a portion of an unrecognized tax benefit, should be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward. To the extent a net operating loss carryforward, a similar tax loss, or a tax credit carryforward is not available as of the reporting date under the tax law of the applicable jurisdiction to settle any additional income taxes that would result from the disallowance of a tax position or the tax law of the applicable jurisdiction does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. The assessment of whether a deferred tax asset is available is based on the unrecognized tax benefit and deferred tax asset that exist at the reporting date and should be made presuming disallowance of the tax position at the reporting date. This guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2014, with early adoption permitted. We plan to adopt this guidance during the quarter ended March 31, 2015 and are assessing the potential impact to our consolidated financial statements. | |
In February 2013, the FASB issued guidance that expanded disclosures for items reclassified out of accumulated other comprehensive income. The standard requires presentation of information about reclassification adjustments from accumulated other comprehensive income in a single note to or on the face of the financial statements. This guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. We plan to adopt the guidance during the quarter ended March 31, 2014, and do not expect it to have a significant impact our consolidated financial statements. | |
In July 2012, the FASB issued amended guidance relating to goodwill and other intangible assets which permits an entity to first assess qualitative factors to determine whether it is more likely than not that an indefinite-lived intangible asset is impaired as a basis for determining whether it is necessary to perform the quantitative impairment test in accordance with GAAP. The more-likely-than-not threshold is defined as having a likelihood of more than 50%. If, after assessing the totality of events and circumstances, an entity concludes that it is not more likely than not that the indefinite-lived intangible asset is impaired, then no further action is required. This guidance was adopted effective as of January 1, 2013. Since this guidance only changes the manner in which we assess indefinite-lived intangible assets for impairment, adoption is expected not have a material effect on our consolidated financial statements. | |
In December 2011, the FASB issued guidance which requires disclosures of both gross and net information about instruments and transactions eligible for offset as well as transactions subject to an agreement similar to a master netting agreement. This guidance was adopted effective January 1, 2013. As this guidance is limited to presentation only, adoption of this guidance did not have a material impact on our consolidated financial statements. |
Business_Acquisitions
Business Acquisitions | 9 Months Ended | |||||||||||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||||||||||
Business Acquisitions | ' | |||||||||||||||||||||||||
2. Business Acquisitions | ||||||||||||||||||||||||||
Acquisition of Sunrise Health Plans, Inc. and Affiliates | ||||||||||||||||||||||||||
On July 17, 2013, we consummated a Stock Purchase Agreement (the “Purchase Agreement”) with Joseph Safina, Howard Knaster and Jorge Saavedra (collectively, the “Sellers”), pursuant to which we acquired from the Sellers all of the outstanding equity of each in Sunrise Health Plans, Inc., a licensed insurance broker, Sunrise Group Marketing, Inc., a call center and sales lead management company, and Secured Software Solutions, Inc., an intellectual property holding company, each of which was converted to a limited liability company shortly after closing, for a cash payment of $10.0 million plus $6.7 million of contingent consideration described below. The funding of the $10.0 million cash portion of the purchase price was provided primarily from net proceeds from the IPO. | ||||||||||||||||||||||||||
The Sellers may receive contingent cash consideration under an adjustable promissory note issued by us with an initial face amount of $2.75 million, due on June 30, 2015 bearing an interest rate of 5%. Based upon the level of commission revenue attained by the acquired business operations between July 1, 2013 and June 30, 2015, the principal amount may be decreased if such commission revenue does not increase to a minimum threshold that the parties established (the “threshold”) based upon actual commission revenues during the calendar year ended December 31, 2012. Alternatively, in the event growth in commission revenue increases above the threshold, the note’s principal amount may be increased to allow the Sellers to share a portion of the commission growth above the threshold. We and each of the Sellers entered into agreements providing for equity earn-out consideration whereby the Sellers have contingent rights to receive up to $3.75 million based on the achievement of certain performance and financial targets over the three years following the closing. To the extent that such targets are achieved, such earn-out consideration will be paid in our Class A common stock. The stock price used to determine the number of shares to be issued in connection with such earn-out consideration will be determined at the end of the respective performance periods as set forth in each of the forms of Performance Based Stock Award (A) Agreement and Performance Based Stock Award (B) Agreement, copies of which are incorporated by reference to the Current Report on Form 8-K filed on July 23, 2013. The estimated range of potential total contingent consideration is approximately $150,000 to $9.0 million. In connection with the Purchase Agreement, on July 17, 2013, we also entered into employment agreements with the Sellers. | ||||||||||||||||||||||||||
This transaction is expected to provide us with additional benefits such as reduced enterprise risk from enhanced oversight of our distribution, addition of sales lead management expertise to maximize the number of new insurance policies produced by each dollar invested in sales leads, and opportunities through technological and cost-saving synergies. | ||||||||||||||||||||||||||
The following table summarizes the fair value of the consideration for the acquisition as of July 17, 2013 ($ in thousands). The fair values are derived using discount rates related to the probability of the Sellers meeting the thresholds for payment and other risk factors including credit risk. | ||||||||||||||||||||||||||
Cash paid at closing | $ | 10,000 | ||||||||||||||||||||||||
Contingent consideration: | ||||||||||||||||||||||||||
Note payable | 1,671 | |||||||||||||||||||||||||
Contingent equity consideration | 3,051 | |||||||||||||||||||||||||
Other contingent consideration | 150 | |||||||||||||||||||||||||
Total consideration | $ | 14,872 | ||||||||||||||||||||||||
The fair value of the note payable and equity contingent consideration is $1.7 million and $3.1 million, as of September 30, 2013 respectively, and is included in contingent acquisition consideration on the accompanying consolidated balance sheet. | ||||||||||||||||||||||||||
The following table summarizes the allocation of the total purchase prices for the acquisition as of July 17, 2013 ($ in thousands): | ||||||||||||||||||||||||||
Cash | $ | 91 | ||||||||||||||||||||||||
Accounts receivable and other assets (1) | 332 | |||||||||||||||||||||||||
Property and equipment (1) | 128 | |||||||||||||||||||||||||
Accounts payable and accrued expenses | (326 | ) | ||||||||||||||||||||||||
Intangible asset – brand | 76 | |||||||||||||||||||||||||
Intangible asset – noncompete agreements | 99 | |||||||||||||||||||||||||
Intangible asset – customer relationships-distributors | 1,050 | |||||||||||||||||||||||||
Intangible asset – customer relationships-direct | 788 | |||||||||||||||||||||||||
Intangible asset – capitalized software | 526 | |||||||||||||||||||||||||
Goodwill (2) | 12,108 | |||||||||||||||||||||||||
$ | 14,872 | |||||||||||||||||||||||||
(1) The carrying value of accounts receivable and property and equipment acquired approximated fair value; as such, no adjustments to these accounts were recorded in association with the acquisition. | ||||||||||||||||||||||||||
(2) As of September 30, 2013, the amount of goodwill acquired that we expect to be deductible for income tax purposes is $5.6 million. | ||||||||||||||||||||||||||
The goodwill allocated to the purchase price was calculated as the fair value of the consideration less the assets acquired and liabilities assumed. This value is primarily related to expected results of future operations of Secured and the operational and technological synergies we expect to realize as a result of the acquisition. | ||||||||||||||||||||||||||
Related to the acquisition of Secured, during the three and nine months ended September 30, 2013, we recognized $107,000 and $301,000 in transaction costs, respectively. Transaction costs were expensed as incurred and are included in Selling, general and administrative expenses in the accompanying consolidated statements of operations. | ||||||||||||||||||||||||||
As a result of acquiring Secured, our consolidated results of operations include the results of Secured since the acquisition date. Secured’s revenues and pre-tax net loss included in our results of operations since the acquisition were $1.3 million and $205,000, respectively, for each of the three and nine months ended September 30, 2013. Net loss before taxes included $166,000 of amortization expense related to the identified intangible assets recorded as a result of the acquisition. | ||||||||||||||||||||||||||
The following table presents unaudited pro forma information for the Company assuming the acquisition of Secured had occurred as of January 1, 2012. This pro forma information does not purport to represent what our actual results would have been if the acquisition had occurred as of the date indicated or what such results would be for any future periods. | ||||||||||||||||||||||||||
($ in thousands, except per share data) | ||||||||||||||||||||||||||
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||||||||||||
Revenues | $ | 15,162 | $ | 12,045 | $ | 43,383 | $ | 31,997 | ||||||||||||||||||
Net (loss) income before income taxes | (209 | ) | 1,170 | (5,491 | ) | 4,045 | ||||||||||||||||||||
Net (loss) income | (226 | ) | 1,170 | (5,885 | ) | 4,045 | ||||||||||||||||||||
Net (loss) income attributable to Health Insurance Innovations, Inc. and Health Plan Intermediaries, LLC | (93 | ) | 1,213 | (1,219 | ) | 4,108 | ||||||||||||||||||||
Loss per share – basic | (0.02 | ) | — | (0.26 | ) | — | ||||||||||||||||||||
Loss per share – diluted | (0.02 | ) | — | (0.26 | ) | — | ||||||||||||||||||||
Acquisition of Insurance Center for Excellence, LLC and Other Transactions | ||||||||||||||||||||||||||
On June 1, 2012, HPI and TSG Agency, LLC (“TSG”) acquired ICE. ICE is a call center training facility for the Company’s distributors. In connection with the transaction, HPI received an 80% controlling interest in ICE and was required to contribute $80,000 in capital contributions, and TSG received a 20% noncontrolling interest in the business and was required to contribute $20,000 in capital contributions. Subsequent to the initial contributions, HPI contributed an additional $240,000, and TSG contributed an additional $60,000, respectively, to ICE during the year ended December 31, 2012. During the nine months ended September 30, 2013, we contributed $40,000 to ICE, and TSG contributed $16,000 to ICE. On June 30, 2013, we purchased TSG’s 20% interest in ICE for $90,000 and, as a result, ICE is our wholly-owned subsidiary. | ||||||||||||||||||||||||||
ICE entered into employment agreements with employees of The Amacore Group, Inc. (“Amacore”) contemporaneously with the June 1, 2012 formation of ICE, and at the date of formation, former Amacore employees comprised the full staff of ICE. ICE additionally assumed a month-to-month lease for space that was occupied by Amacore immediately prior to the formation of ICE. | ||||||||||||||||||||||||||
Concurrent with the formation of ICE, ICE additionally entered into a sublease agreement (“Lease Agreement”) with Amacore for additional space effective June 1, 2012. Under the Lease Agreement, ICE assumed all rights, responsibilities, obligations, terms and conditions of the original lease, which expires on April 30, 2015. Amacore agreed to transfer to ICE a security deposit previously paid by Amacore of approximately $13,000, and Amacore contributed $15,000 to ICE for the purchase of property and equipment, certain office and computer equipment and rights to certain 800 numbers, to ICE that have minimal value. We are recognizing the consideration provided by Amacore as a lease incentive that is being amortized over the term of the lease on a straight-line basis. | ||||||||||||||||||||||||||
Additionally, concurrent with its June 1, 2012 formation, ICE entered into an Agent Producer Agreement and an Assignment of Commissions Agreement with Amacore (collectively referred to as “Agent Agreement”). Under the Agent Agreement, ICE assigned its commissions with respect to Assurant dental sales to Amacore in return for production incentives, training, marketing materials, commission payments and reporting, advances on commissions and ongoing sales support. | ||||||||||||||||||||||||||
The transaction with Amacore as described above is a business combination, and no assets or liabilities, including intangible assets or goodwill, were recognized other than those described above. | ||||||||||||||||||||||||||
In March 2013, we paid $5.5 million to terminate certain contract rights with TSG. As a result of this transaction, Ivan Spinner, who controls TSG, became an employee of the Company. This transaction was expensed during the nine months ended September 30, 2013, and is included within contract termination expense on the accompanying consolidated statement of operations. |
Goodwill_and_Intangible_Assets
Goodwill and Intangible Assets | 9 Months Ended | ||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||
Goodwill and Intangible Assets | ' | ||||||||||||||||||
3. Goodwill and Intangible Assets | |||||||||||||||||||
Goodwill | |||||||||||||||||||
Our goodwill balance as of January 1, 2012 arose from the acquisition of the Naylor units of HPI as described in Note 1. Our goodwill balance as of September 30, 2013 arose from the Secured acquisition described in Note 2 as well as our goodwill balance existing prior to such acquisition. | |||||||||||||||||||
The changes in the carrying amounts of goodwill were as follows ($ in thousands): | |||||||||||||||||||
Balance as of January 1, 2012 | $ | 5,906 | |||||||||||||||||
Goodwill acquired | — | ||||||||||||||||||
Impairment of goodwill | — | ||||||||||||||||||
Balance as of December 31, 2012 | $ | 5,906 | |||||||||||||||||
Goodwill acquired | 12,108 | ||||||||||||||||||
Impairment of goodwill | — | ||||||||||||||||||
Balance as of September 30, 2013 | $ | 18,014 | |||||||||||||||||
Other intangible assets | |||||||||||||||||||
Our other intangible assets arose primarily from the acquisitions described above and consist of a brand, the carrier network, distributor relationships, customer relationships, noncompete agreements and capitalized software. Finite-lived intangible assets are amortized over their useful lives from two to fifteen years. | |||||||||||||||||||
Major classes of intangible assets as of September 30, 2013 consisted of the following ($ in thousands): | |||||||||||||||||||
Weighted-average | Gross Carrying | Accumulated | Intangible | ||||||||||||||||
Amortization | Amount | Amortization | Asset, net | ||||||||||||||||
Brand | 2.0 | $ | 476 | $ | (408 | ) | $ | 68 | |||||||||||
Carrier network | 5.0 | 40 | (16 | ) | 24 | ||||||||||||||
Distributor relationships | 8.8 | 4,660 | (1,046 | ) | 3,614 | ||||||||||||||
Noncompete agreements | 4.8 | 942 | (204 | ) | 738 | ||||||||||||||
Customer relationships | 2.0 | 788 | (82 | ) | 706 | ||||||||||||||
Capitalized software | 2.2 | 571 | (65 | ) | 506 | ||||||||||||||
Total intangible assets | 6.6 | $ | 7,477 | $ | (1,821 | ) | $ | 5,656 | |||||||||||
Major classes of intangible assets as of December 31, 2012 consisted of the following: | |||||||||||||||||||
Weighted-average | Gross Carrying | Accumulated | Intangible | ||||||||||||||||
Amortization | Amount | Amortization | Asset, net | ||||||||||||||||
Brand | 2.0 | $ | 400 | $ | (250 | ) | $ | 150 | |||||||||||
Capitalized software | 5.0 | 45 | (4 | ) | 41 | ||||||||||||||
Carrier network | 5.0 | 40 | (10 | ) | 30 | ||||||||||||||
Distributor relationships | 7.0 | 3,610 | (645 | ) | 2,965 | ||||||||||||||
Noncompete agreement | 5.0 | 843 | (70 | ) | 773 | ||||||||||||||
Total intangible assets | 6.2 | $ | 4,938 | $ | (979 | ) | $ | 3,959 | |||||||||||
Amortization expense for the three months ended September 30, 2013 and 2012 was $391,000 and $217,000, respectively, and $842,000 and $735,000, for the nine months ended September 30, 2013 and 2012, respectively. | |||||||||||||||||||
Estimated annual pretax amortization for intangibles assets for 2013 and in each of the next five years are as follows ($ in thousands): | |||||||||||||||||||
Remainder of 2013 | $ | 375 | |||||||||||||||||
2014 | 1,499 | ||||||||||||||||||
2015 | 1,181 | ||||||||||||||||||
2016 | 787 | ||||||||||||||||||
2017 | 689 | ||||||||||||||||||
2018 | 457 | ||||||||||||||||||
Deferred_Revenue
Deferred Revenue | 9 Months Ended |
Sep. 30, 2013 | |
Deferred Revenue | ' |
4. Deferred Revenue | |
Deferred revenue represents advanced payments received for commissions on the sales of our products. Revenues related to these advanced payments are earned ratably over the active term of each policy. All deferred revenue amounts are realizable within one year and are included in current liabilities in the accompanying consolidated balance sheets. Deferred revenue balance at September 30, 2013 and at December 31, 2012 was $863,000 and $268,000, respectively. |
Debt
Debt | 9 Months Ended |
Sep. 30, 2013 | |
Debt | ' |
5. Debt | |
During September 2011, HPI entered into a bank loan agreement with a principal balance of $4.3 million. The purpose of this loan was to finance a portion of the acquisition of the remaining 50% interest in HPI as discussed in Note 1. At the inception of the loan, borrowings under the facility were secured by all of HPI’s assets, including, but not limited to, cash accounts, accounts receivable, and property and equipment. The loan was further secured with a personal unlimited guarantee by Mr. Kosloske and certain real properties owned by Mr. Kosloske. The loan was a self-amortizing five-year loan bearing fixed interest at 5.25% with equal monthly payments of $81,000, which included principal and interest. | |
There was no interest expense incurred on the loan for the three months ended September 30, 2013 and $17,000 for the nine months ended September 30, 2013. Interest expense incurred on the loan was $48,000 and $151,000 during the three and nine months ended September 30, 2012, respectively. | |
In connection with the loan, we recorded deferred financing costs which consisted primarily of consulting and legal fees directly related to the loan. These amounts were amortized over the term of the loan using the effective interest rate method. There was no amortization expense on the deferred financing costs for the three months ended September 30, 2013 and $7,000 for the nine months ended September 30, 2013. Amortization expense for the three and nine months ended September 30, 2012 was $11,000 and $34,000, respectively. | |
In February 2013, we repaid the $3.2 million outstanding balance of the loan using a portion of the proceeds of the IPO. The remaining deferred financing costs of $71,000 were written-off to other expense (income) on the accompanying consolidated statement of operations when the loan was repaid. |
Stockholders_Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2013 | |
Stockholders' Equity | ' |
6. Stockholders’ Equity | |
Refer to Note 1 for further information regarding the current capital structure of the Company. | |
On February 13, 2013, we completed our IPO by issuing 4,666,667 shares of our Class A common stock, par value $0.001 per share, at a price to the public of $14.00 per share of common stock. In addition, we issued 8,666,667 shares of our Class B common stock, of which 8,580,000 shares of Class B common stock were obtained by HPI and 86,667 shares of Class B common stock were obtained by HPIS, of which HPI is the managing member. In addition, we granted the underwriters of the IPO the right to purchase additional shares of Class A common stock to cover over-allotments (the “over-allotment option”). | |
Holders of each of Class A common stock and Class B common stock are entitled to one vote per share on all matters to be voted upon by the shareholders, and holders of each class will vote together as a single class on all such matters. Holders of shares of our Class A common stock and Class B common stock vote together as a single class on all matters presented to our stockholders for their vote or approval, except as otherwise required by applicable law. As of September 30, 2013, Class A common stockholders have 38.1% of the voting power in HII and Class B common stockholders have 61.9% of the voting power of HII. Holders of shares of our Class A common stock have 100% of the economic interest in HII. Holders of Class B common stock do not have an economic interest in HII. | |
In accordance with the Exchange Agreement, in March 2013, we received $1.3 million in proceeds from the issuance of 100,000 shares of Class A common stock through the over-allotment option. We immediately used the proceeds to acquire Series B Membership Interests, together with an equal number of shares of our Class B common stock, from HPI. These Series B Membership Interests were immediately recapitalized into Series A Membership Interests in HPIH. | |
Upon completion of the IPO, HII became a holding company, the principal asset of which is our interest in HPIH. All of our business is conducted through HPIH. We are the sole managing member of HPIH and have 100% of its voting rights and control. | |
Our authorized capital stock consists of 100,000,000 shares of Class A common stock, par value $0.001 per share, 20,000,000 shares of Class B common stock, par value $0.001 per share and 5,000,000 shares of preferred stock, par value $0.001 per share. | |
Class A Common Stock | |
The determination to pay dividends, if any, to our Class A common stockholders will be made by our board of directors. We do not, however, expect to declare or pay any cash or other dividends in the foreseeable future on our Class A common stock, as we intend to reinvest any cash flow generated by operations in our business. We may enter into credit agreements or other borrowing arrangements in the future that prohibit or restrict our ability to declare or pay dividends on our Class A common stock. In the event of liquidation, dissolution or winding up of HII, the holders of Class A common stock are entitled to share ratably in all assets remaining after payment of liabilities, subject to prior distribution rights of preferred stock, if any, then outstanding. The holders of our Class A common stock have no preemptive or conversion rights or other subscription rights. There are no redemption or sinking fund provisions applicable to the Class A common stock. The rights, preferences and privileges of holders of our common stock will be subject to those of the holders of any shares of our preferred stock we may issue in the future. | |
Class B Common Stock | |
Class B common stockholders will not be entitled to any dividend payments. In the event of any dissolution, liquidation, or winding up of our affairs, whether voluntary or involuntary, after payment of our debts and other liabilities and making provision for any holders of our preferred stock that have a liquidation preference, our Class B common stockholders will not be entitled to receive any of our assets. In the event of our merger or consolidation with or into another company in connection with which shares of Class A common stock and Class B common stock (together with the related membership interests) are converted into, or become exchangeable for, shares of stock, other securities or property (including cash), each Class B common stockholder will be entitled to receive the same number of shares of stock as is received by Class A stockholders for each share of Class A stock, and will not be entitled, for each share of Class B stock, to receive other securities or property (including cash). No holders of Class B common stock will have preemptive rights to purchase additional shares of Class B common stock. | |
Preferred Stock | |
Our board of directors has the authority to issue shares of preferred stock in one or more series and to fix the rights, preferences, privileges and restrictions thereof, including dividend rights, dividend rates, conversion rights, voting rights, terms of redemption, redemption prices, liquidation preferences and the number of shares constituting any series or the designation of such series, without further vote or action by the stockholders. | |
The issuance of preferred stock may have the effect of delaying, deferring or preventing a change in control of HII without further action by the stockholders and may adversely affect the voting and other rights of the holders of Class A common stock. At present, we have no plans to issue any preferred stock. | |
Treasury Stock | |
As of September 30, 2013, we had 32,477 shares of treasury stock, carried at a cost of $377,000. These shares were repurchased pursuant to the surrender of shares by certain employees to satisfy statutory tax withholding obligations on vested restricted stock awards. |
Variable_Interest_Entities
Variable Interest Entities | 9 Months Ended |
Sep. 30, 2013 | |
Variable Interest Entities | ' |
7. Variable Interest Entities | |
As of September 30, 2013, we had a variable interest in HPIH, and HPIH is a variable interest entity (“VIE”), pursuant to FASB guidance. HPIH is a VIE as the voting rights of the investors are not proportional to their obligations to absorb the expected losses of HPIH. We hold 100% of the voting power in HPIH, but own less than 50% of the total membership interest, and the other members of HPIH hold no voting rights in HPIH, but own more than 50% of the membership interest. Further, substantially all of the activities of HPIH are conducted on behalf of a membership with disproportionately few voting rights. | |
We have concluded that we are the primary beneficiary of HPIH, and, therefore, should consolidate HPIH since we have both power and benefits over HPIH. We have the power to direct the activities of HPIH that most significantly impact the entity’s economic performance. Pursuant to the Third Amended and Restated Limited Liability Company Agreement of Health Plan Intermediaries Holdings, LLC, we are the sole managing member of HPIH, operate the business, have 100% of the voting power and control the management of HPIH. Our minority equity interest in HPIH obligates us to absorb losses of HPIH and gives us the right to receive benefits from HPIH related to the day-to-day operations of the entity, both of which could potentially be significant to HPIH. As such, our maximum exposure to loss as a result of our involvement in this VIE is 100% of the operating income or loss of the VIE. |
Stockbased_Compensation
Stock-based Compensation | 9 Months Ended | |||||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||||
Stock-based Compensation | ' | |||||||||||||||||||
8. Stock-based Compensation | ||||||||||||||||||||
We maintain one stock-based incentive plan, the Health Insurance Innovations, Inc. Long Term Incentive Plan (the “LTIP”), which became effective February 7, 2013, under which stock options, stock appreciation rights (“SARs”), restricted shares and other types of equity and cash incentive awards may be granted to employees, non-employee directors and service providers. The LTIP expires after ten years, unless prior to that date the maximum number of shares available for issuance under the plan has been issued or our board of directors terminates this plan. There are 1,250,000 shares of common stock reserved for issuance under the LTIP. | ||||||||||||||||||||
Expense for stock-based compensation is recognized based upon estimated grant date fair value and is amortized over the service period of the awards using the accelerated method. For grants of options or SARs, we apply the Black-Scholes option-pricing model in determining the fair value of share-based payments to employees. The resulting compensation expense is recognized over the requisite service period. The requisite service period is the period during which an employee is required to provide service in exchange for an award, which often is the vesting period. Compensation expense is recognized only for those awards expected to vest, with forfeitures estimated based on our historical experience and future expectations. All stock-based compensation expense is classified within Selling, general and administrative expense in the consolidated statements of operations. None of the stock-based compensation was capitalized during the three and nine months ended September 30, 2013. | ||||||||||||||||||||
The fair value of SARs granted during the first nine months of 2013 was based upon the Black-Scholes option-pricing model. The expected term of the awards represents the estimated period of time until exercise, giving consideration to the contractual terms, vesting schedules and expectations of future employee behavior. For 2013, the expected stock price volatility was determined using a peer group of public companies within our industry as it is not practicable for the Company to estimate its own volatility due to the lack of a liquid market and active market trades. The risk-free interest rate is based on the U.S. Treasury yield curve in effect at the time of grant with an equivalent remaining term. The Company has not paid dividends in the past and does not currently plan to pay any dividends in the foreseeable future. | ||||||||||||||||||||
The Black-Scholes option-pricing model was used with the following weighted average assumptions: | ||||||||||||||||||||
Risk-free rate | 1.0 | % | ||||||||||||||||||
Expected life | 4.5 years | |||||||||||||||||||
Volatility | 46.0 | % | ||||||||||||||||||
Expected dividend | none | |||||||||||||||||||
The following table summarizes SARs and restricted shares granted during the three and nine months ended September 30 (in thousands): | ||||||||||||||||||||
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||||||
SARs | Restricted | SARs | Restricted | SARs | Restricted | SARs | Restricted | |||||||||||||
Issued | Shares | Issued | Shares | Issued | Shares | Issued | Shares | |||||||||||||
Issued | Issued | Issued | Issued | |||||||||||||||||
20 | — | — | — | 170 | 543 | — | — | |||||||||||||
The following table summarizes stock-based compensation expense for the three and nine months ended September 30, 2013 and 2012 (in thousands): | ||||||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||||||
SARs | $ | 184 | $ | — | $ | 478 | $ | — | ||||||||||||
Restricted shares | 1,391 | — | 3,798 | — | ||||||||||||||||
$ | 1,575 | $ | — | $ | 4,276 | $ | — | |||||||||||||
The following table summarizes unrecognized stock-based compensation and the remaining period over which such stock-based compensation is expected to be recognized as of September 30, 2013 (in thousands): | ||||||||||||||||||||
Remaining | ||||||||||||||||||||
years | ||||||||||||||||||||
SARs | $ | 421 | 1.6 | |||||||||||||||||
Restricted shares | 3,698 | 3.7 | ||||||||||||||||||
$ | 4,119 | |||||||||||||||||||
These amounts do not include the cost of any additional awards that may be granted in future periods nor any changes in our forfeiture rate. There were no SARs exercised during the three and nine months ended September 30, 2013. | ||||||||||||||||||||
We did not have any income tax benefits realized from activity involving stock options, stock appreciation rights, or restricted shares for the three and nine months ended September 30, 2013. |
Net_Income_Loss_per_Share
Net Income (Loss) per Share | 9 Months Ended | |||||||||||||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||||||||||||
Net Income (Loss) per Share | ' | |||||||||||||||||||||||||||
9. Net income (loss) per Share | ||||||||||||||||||||||||||||
The computations of basic and diluted net loss per share attributable to Health Insurance Innovations, Inc. for the three and nine months ended September 30, 2013 were as follows (in thousands, except share data): | ||||||||||||||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||||
September 30, 2013 | ||||||||||||||||||||||||||||
Basic net income (loss) attributable to Health Insurance Innovations, Inc. | $ | 408 | $ | (3,684 | ) | |||||||||||||||||||||||
Average shares—basic | 4,795,736 | 4,768,294 | ||||||||||||||||||||||||||
Effect of dilutive securities: | ||||||||||||||||||||||||||||
Restricted shares | 65,600 | — | ||||||||||||||||||||||||||
SARs | — | — | ||||||||||||||||||||||||||
Average shares—diluted | 4,861,336 | 4,768,294 | ||||||||||||||||||||||||||
Basic net income (loss) per share attributable to Health Insurance Innovations, Inc. | $ | 0.09 | $ | (0.77 | ) | |||||||||||||||||||||||
Diluted net income (loss) per share attributable to Health Insurance Innovations, Inc. | $ | 0.08 | $ | (0.77 | ) | |||||||||||||||||||||||
Potential common shares are included in the diluted net loss per share calculation when dilutive. Potential common shares consist of Class A common stock issuable through restricted stock grants and stock appreciation rights and are calculated using the treasury stock method. | ||||||||||||||||||||||||||||
The following securities were not included in the calculation of diluted net loss per share because such inclusion would be anti-dilutive (in thousands): | ||||||||||||||||||||||||||||
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||||||||||||||
Restricted shares | 385 | — | 405 | — | ||||||||||||||||||||||||
SARs | 120 | — | 120 | — | ||||||||||||||||||||||||
Income_Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2013 | |
Income Taxes | ' |
10. Income Taxes | |
Our former operating entity, HPI, was taxed as an S corporation for income tax purposes. Therefore, we were not subject to entity-level federal or state income taxation prior to the IPO. HPIH and HPIS are currently taxed as partnerships for federal income tax purposes; as a result, the members of HPIH and HPIS pay taxes with respect to their allocable shares of each company’s respective net taxable income. | |
Following the IPO, HPIH and HPIS continue to operate in the United States as partnerships for U.S. federal income tax purposes. We are subject to U.S. corporate federal, state and local income taxes that are reflected in our consolidated financial statements. The effective tax rate for the nine months ended September 30, 2013 was (6.4)%. For the three months ended September 30, 2013, we incurred a benefit for income taxes of $823,000. For the nine months ended September 30, 2013, we incurred a provision for income taxes of $472,000. | |
We account for uncertainty in income taxes using a two-step process. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained upon audit, including resolution of related appeals or litigation processes, if any. The second step requires us to estimate and measure the tax benefit as the largest amount that is more than 50% likely to be realized upon ultimate settlement. Such amounts are subjective, as a determination must be made on the probability of various possible outcomes. We reevaluate uncertain tax positions on a quarterly basis. This evaluation is based on factors including, but not limited to, changes in facts or circumstances, changes in tax law, effectively settled issues under audit, and new audit activity. Such a change in recognition and measurement could result in recognition of a tax benefit or an additional tax provision. | |
We evaluate quarterly the positive and negative evidence regarding the realization of net deferred tax assets. The carrying value of our net deferred tax assets is based on our belief that it is more likely than not that we will generate sufficient future taxable income to realize these deferred tax assets, | |
Our effective tax rate includes a rate detriment attributable to the fact that certain of our subsidiaries operate as limited liability companies which are not subject to federal or state income tax. Accordingly, a portion of our earnings or losses attributable to noncontrolling interests are not subject to corporate level taxes. Additionally, our effective tax rate includes a valuation allowance placed on all of our deferred tax assets, as our belief is more likely than not that our deferred tax assets will not be realized to offset future taxable income. | |
We project to have a current tax liability for the year, primarily as a result of differences between financial reporting and tax-based reporting for the timing of expense recognition. We do not project that the current tax liability will enable any portion of our deferred tax assets to be realized, and as such, the tax benefit that ordinarily accompanies a deferred tax asset is not available to offset the tax expense from our projected current tax liability. The resulting tax expense correlates with the determination of our effective tax rate. | |
As of December 31, 2012, we did not have any balance of gross unrecognized tax benefits, and as such, no amount would favorably affect the effective income tax rate in any future periods. For the three and nine months ended September 30, 2013, there was no change to our total gross unrecognized tax benefit. We believe that there will not be a significant increase or decrease to the uncertain tax positions within 12 months of the reporting date. |
Commitments_and_Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2013 | |
Commitments and Contingencies | ' |
11. Commitments and Contingencies | |
Leases | |
We lease office spaces to conduct the operations of HPIH, ICE and Secured which expire in 2017, 2015 and 2014, respectively. We also lease certain equipment under operating leases, which expire in 2015. The office space operating lease agreements contain rent holidays and rent escalation provisions. Rent holidays and rent escalation provisions are considered in determining straight-line rent expense to be recorded over the lease term. The difference between cash rent payments and straight-line rent expense was $68,000 and $63,000 as of September 30, 2013 and December 31, 2012, respectively. Total rent expense under all operating leases, which includes equipment, was $96,000 and $74,000 for the three months ended September 30, 2013 and 2012, respectively and $210,000 and $132,000 for the nine months ended September 30, 2013 and 2012, respectively and is included in Selling, general and administrative expenses in the accompanying consolidated statements of operations. | |
BimSym Agreements | |
On August 1, 2012, we entered into a software assignment agreement (“Agreement”) with BimSym eBusiness Solutions, Inc. (“BimSym”) for our exclusive ownership of all rights, title and interest in the technology platform (“A.R.I.E.S. System”) developed by BimSym and utilized by us. As a result of the executed Agreement, we purchased the A.R.I.E.S. System for $45,000. The consideration of $45,000 was capitalized and recorded as an intangible asset. In connection with this Agreement, we simultaneously entered into a master services agreement for the technology, under which we are required to make monthly payments of $26,000 for five years. After the five-year term, this agreement automatically renews for one-year terms unless 60 days’ notice is given by us. | |
Additionally, we also entered into an exclusivity agreement with BimSym whereby neither BimSym nor any of its affiliates will create, market or sell a software, system or service with the same or similar functionality as that of A.R.I.E.S. System under which we are required to make monthly payments of $16,000 for five years. The present value of these payments was capitalized and recorded as an intangible asset with a corresponding liability on the accompanying consolidated balance sheets. | |
Legal Proceedings | |
As of September 30, 2013, we had no significant outstanding legal proceedings. We are subject to certain legal proceedings and claims that may arise in the ordinary course of business. In the opinion of management, we do not have a potential liability related to any current legal proceedings and claims that would individually, or in the aggregate, have a material adverse effect on our financial condition, liquidity, results of operations, or cash flows. |
Fair_Value_Measurements
Fair Value Measurements | 9 Months Ended | |||||||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||||||
Fair Value Measurements | ' | |||||||||||||||||||||
12. Fair Value Measurements | ||||||||||||||||||||||
We measure and report financial assets and liabilities at fair value on a recurring basis. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (referred to as 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 used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. The fair value of our financial assets and liabilities is determined by using three levels of input, which are defined as follows: | ||||||||||||||||||||||
Level 1: | Quoted prices in active markets for identical assets or liabilities | |||||||||||||||||||||
Level 2: | Quoted prices in active markets for similar assets or liabilities, 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 categorization of a financial instrument within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. | ||||||||||||||||||||||
We utilize the market approach to measure the fair value of our financial assets. As subjectivity exists with respect to many of the valuation techniques, the fair value estimates we have disclosed may not equal prices that we may ultimately realize if the assets are sold or the liabilities are settled with third parties. Below is a description of our valuation methods. | ||||||||||||||||||||||
Short-term investments. Our short-term investments include an available for sale marketable security and certificates of deposit. The marketable security is a publicly-traded fixed-income mutual fund with a quoted price in an active market. The certificates of deposit have maturities ranging from three months to nine months. The short-term investments are classified within Level 1 of the fair value hierarchy. | ||||||||||||||||||||||
Contingent consideration for business acquisition. The contingent consideration related to the acquisition of Secured includes a note payable and a contingent equity liability, as described in Note 2, and are valued using external valuation specialists. The inputs include discount rates reflecting the credit risk, risk of the underlying outcome of the results required by Secured to receive payment and the nature of such payments. The underlying outcomes are subject to actual revenues and earnings relative to the target results in the respective instruments or agreement. These liabilities are included in Level 2 of the fair value hierarchy. | ||||||||||||||||||||||
Noncompete obligation. Our noncompete obligation, an exclusivity agreement with the developer of A.R.I.E.S as described in Note 11 are primarily valued using nonbinding market prices as stated in the agreement that are corroborated by observable market data. The inputs and fair value are reviewed for reasonableness and may be further validated by comparison to publicly available information or compared to multiple independent valuation sources. The noncompete obligation is classified within Level 2 of the fair value hierarchy. | ||||||||||||||||||||||
The carrying amounts of financial assets and liabilities reported in the accompanying consolidated balance sheets for cash and cash equivalents, cash held on behalf of others, credit card transactions receivable, accounts receivable, advanced commissions, carriers and vendors payable, commissions payable, and accounts payable and accrued expenses as of September 30, 2013 approximate fair value because of the short-term duration of these instruments. | ||||||||||||||||||||||
As of September 30, 2013, our short-term investments, which include an available-for-sale marketable security (a mutual fund), certificates of deposit with maturities greater than three months to nine months, our noncompete obligation, notes payable and contingent equity consideration measured at fair value were as follows ($ in thousands): | ||||||||||||||||||||||
Carrying Value as of | Fair Value Measurement as of September 30, 2013 | |||||||||||||||||||||
30-Sep-13 | Level 1 | Level 2 | Level 3 | |||||||||||||||||||
Assets: | ||||||||||||||||||||||
Marketable security, available-for-sale | $ | 15,000 | $ | 15,000 | $ | — | $ | — | ||||||||||||||
Certificates of deposit | 6,414 | 6,414 | ||||||||||||||||||||
$ | 21,414 | $ | 21,414 | $ | — | $ | — | |||||||||||||||
Liabilities: | ||||||||||||||||||||||
Noncompete obligation, including current portion | $ | 665 | $ | — | $ | 656 | $ | — | ||||||||||||||
Note payable | 1,718 | — | 1,718 | — | ||||||||||||||||||
Contingent equity consideration | 3,068 | — | 3,068 | — | ||||||||||||||||||
$ | 5,451 | $ | — | $ | 5,442 | $ | — | |||||||||||||||
As of December 31, 2013, our long-term debt and noncompete obligation measured at fair value were as follows ($ in thousands): | ||||||||||||||||||||||
Carrying Value as of | Fair Value Measurement as of December 31, 2012 | |||||||||||||||||||||
31-Dec-12 | Level 1 | Level 2 | Level 3 | |||||||||||||||||||
Liabilities: | ||||||||||||||||||||||
Long-term debt, including current portion | $ | 3,294 | $ | — | $ | 3,314 | $ | — | ||||||||||||||
Noncompete obligation, including current portion | 781 | — | 779 | — | ||||||||||||||||||
$ | 4,075 | $ | — | $ | 4,093 | $ | — | |||||||||||||||
Segments
Segments | 9 Months Ended |
Sep. 30, 2013 | |
Segments | ' |
13. Segments | |
Operating segments are defined as components of an enterprise about which separate financial information is available that is evaluated regularly by the chief operating decision-maker, or decision-making group, in deciding how to allocate resources and in assessing our performance. Our chief operating decision-maker is considered to be the chief executive officer (“CEO”). The CEO reviews our financial information in a manner substantially similar to the accompanying consolidated financial statements. In addition, our operations, revenues, and decision-making functions are based solely in the United States. Therefore, management has concluded that we operate in one operating and geographic segment. |
Related_Party_Transactions
Related Party Transactions | 9 Months Ended |
Sep. 30, 2013 | |
Related Party Transactions | ' |
14. Related Party Transactions | |
Health Plan Intermediaries, LLC | |
HPI, by virtue of its Series B Membership interests in HPIH, of which we are managing member, is a related party, and the beneficial interests in HPI are held by Mr. Kosloske. During the three months ended September 30, 2013, HPIH paid distributions of $74,000 to entities beneficially owned by Mr. Kosloske related to 2012 state income taxes, pursuant to the operating agreement entered into by HPIH and HPI. Distributions of $1.6 million for the nine months ended September 30, 2013 include $944,000 of distributions during the three months ended March 31, 2013, all of which were made prior to the IPO. | |
TSG Agency, LLC | |
In August 2012, we entered into a promissory note with Ivan Spinner, who controls TSG, in the amount of $100,000 for the purpose of funding advanced commissions. The note was non-interest bearing and required equal monthly payments of $25,000 beginning September 20, 2012 and ending December 20, 2012. This loan was modified on October 18, 2012 whereby the November and December payments were deferred to January 2, 2013 and February 1, 2013, respectively. The note had a balance of $50,000 at December 31, 2012 and was repaid during the first quarter of 2013. | |
On March 14, 2013, the Company terminated its contract rights with TSG for an aggregate cash price of $5.5 million. In conjunction with the transaction, Ivan Spinner joined HII as an employee. | |
On June 30, 2013, we purchased TSG’s interest in ICE for a cash payment to TSG of $90,000. See Note 2 for further information on this transaction. | |
Tax Receivable Agreement | |
On February 13, 2013, we entered into a tax receivable agreement with the holders of Series B Membership Interests, which are beneficially owned by Mr. Kosloske. See Note 1 for further description of the tax receivable agreement. | |
As of September 30, 2013, we have made no such payments under the tax receivable agreement. As of September 30, 2013, we would be obligated to pay Mr. Kosloske $374,000 if our taxes payable on our subsequent annual tax return filings are shown to be reduced as result of an increase in our tax basis due to the issuance of 100,000 shares of Class A common stock subsequent to the IPO under the IPO underwriters’ option. See Note 6 for further information on this issuance of Class A common stock. | |
Organization_Basis_of_Presenta1
Organization, Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2013 | |
Basis of Presentation | ' |
Basis of Presentation | |
The consolidated financial statements reflect the results of operations of HPI through the closing of the IPO on February 13, 2013, and HII subsequent to the IPO. Intercompany accounts and transactions have been eliminated in consolidation. | |
Our accompanying unaudited consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X of the Securities Exchange Act of 1934 and do not include all of the information and notes required by U.S. generally accepted accounting principles (“GAAP”) for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring adjustments and accruals) considered necessary for a fair presentation of consolidated financial position, results of operations and cash flows have been included. The consolidated balance sheet data for the year ended December 31, 2012 was derived from our audited financial statements, but does not include all the disclosures required by GAAP. For further information, refer to our Annual Report on Form 10-K for the year ended December 31, 2012, including the consolidated financial statements and accompanying notes. | |
Noncontrolling interests are included in the consolidated balance sheets as a component of stockholders’ equity that is not attributable to the equity of HII. We report separately the amounts of consolidated net income or loss attributable to us and noncontrolling interests. | |
As an “emerging growth company” as defined in the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”), we intend to take advantage of certain temporary exemptions from various reporting requirements, including, but not limited to, not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act and reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements. We have also elected to delay the adoption of new and revised accounting standards until those standards would otherwise apply to nonpublic entities. Our financial statements may therefore not be comparable to those of companies that comply with such new or revised accounting standards. These exemptions will apply for a period of five years following the completion of our IPO although if the market value of our common stock that is held by non-affiliates exceeds $700 million as of any June 30 before that time, we would cease to be an emerging growth company as of the following December 31. | |
Reclassifications | ' |
Reclassifications | |
Certain amounts in the prior year’s consolidated financial statements have been reclassified to conform to the current year presentation. | |
Use of Estimates | ' |
Use of Estimates | |
The preparation of the financial statements in conformity with GAAP requires management to make estimates, judgments and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements. These estimates also affect the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from those estimates. | |
Significant Accounting Policies | ' |
Significant Accounting Policies | |
Except as discussed below, our accounting policies are described in Note 1, Organization, Basis of Presentation and Summary of Significant Accounting Policies, in each of our audited consolidated financial statements for the year ended December 31, 2012 on Form 10-K and our consolidated financial statements for the three and six months ended June 30, 2013 on Form 10-Q. | |
Recent Accounting Pronouncements | ' |
Recent Accounting Pronouncements | |
In the following summary of recent accounting pronouncements, all references to effective dates of Financial Accounting Standards Board (“FASB”) guidance relate to nonpublic entities. As noted above, we have elected to delay the adoption of new and revised accounting standards until those standards would otherwise apply to nonpublic companies under provisions of the JOBS Act. | |
In July 2013, the FASB issued guidance which states that an unrecognized tax benefit, or a portion of an unrecognized tax benefit, should be presented in the financial statements as a reduction to a deferred tax asset for a net operating loss carryforward, a similar tax loss, or a tax credit carryforward. To the extent a net operating loss carryforward, a similar tax loss, or a tax credit carryforward is not available as of the reporting date under the tax law of the applicable jurisdiction to settle any additional income taxes that would result from the disallowance of a tax position or the tax law of the applicable jurisdiction does not require the entity to use, and the entity does not intend to use, the deferred tax asset for such purpose, the unrecognized tax benefit should be presented in the financial statements as a liability and should not be combined with deferred tax assets. The assessment of whether a deferred tax asset is available is based on the unrecognized tax benefit and deferred tax asset that exist at the reporting date and should be made presuming disallowance of the tax position at the reporting date. This guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2014, with early adoption permitted. We plan to adopt this guidance during the quarter ended March 31, 2015 and are assessing the potential impact to our consolidated financial statements. | |
In February 2013, the FASB issued guidance that expanded disclosures for items reclassified out of accumulated other comprehensive income. The standard requires presentation of information about reclassification adjustments from accumulated other comprehensive income in a single note to or on the face of the financial statements. This guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2013. We plan to adopt the guidance during the quarter ended March 31, 2014, and do not expect it to have a significant impact our consolidated financial statements. | |
In July 2012, the FASB issued amended guidance relating to goodwill and other intangible assets which permits an entity to first assess qualitative factors to determine whether it is more likely than not that an indefinite-lived intangible asset is impaired as a basis for determining whether it is necessary to perform the quantitative impairment test in accordance with GAAP. The more-likely-than-not threshold is defined as having a likelihood of more than 50%. If, after assessing the totality of events and circumstances, an entity concludes that it is not more likely than not that the indefinite-lived intangible asset is impaired, then no further action is required. This guidance was adopted effective as of January 1, 2013. Since this guidance only changes the manner in which we assess indefinite-lived intangible assets for impairment, adoption is expected not have a material effect on our consolidated financial statements. | |
In December 2011, the FASB issued guidance which requires disclosures of both gross and net information about instruments and transactions eligible for offset as well as transactions subject to an agreement similar to a master netting agreement. This guidance was adopted effective January 1, 2013. As this guidance is limited to presentation only, adoption of this guidance did not have a material impact on our consolidated financial statements. |
Business_Acquisitions_Tables
Business Acquisitions (Tables) | 9 Months Ended | |||||||||||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||||||||||
Summary of Fair Value of Consideration for Acquisition | ' | |||||||||||||||||||||||||
The following table summarizes the fair value of the consideration for the acquisition as of July 17, 2013 ($ in thousands). The fair values are derived using discount rates related to the probability of the Sellers meeting the thresholds for payment and other risk factors including credit risk. | ||||||||||||||||||||||||||
Cash paid at closing | $ | 10,000 | ||||||||||||||||||||||||
Contingent consideration: | ||||||||||||||||||||||||||
Note payable | 1,671 | |||||||||||||||||||||||||
Contingent equity consideration | 3,051 | |||||||||||||||||||||||||
Other contingent consideration | 150 | |||||||||||||||||||||||||
Total consideration | $ | 14,872 | ||||||||||||||||||||||||
Summary of Allocation of Total Purchase Prices of Acquisition | ' | |||||||||||||||||||||||||
The following table summarizes the allocation of the total purchase prices for the acquisition as of July 17, 2013 ($ in thousands): | ||||||||||||||||||||||||||
Cash | $ | 91 | ||||||||||||||||||||||||
Accounts receivable and other assets (1) | 332 | |||||||||||||||||||||||||
Property and equipment (1) | 128 | |||||||||||||||||||||||||
Accounts payable and accrued expenses | (326 | ) | ||||||||||||||||||||||||
Intangible asset – brand | 76 | |||||||||||||||||||||||||
Intangible asset – noncompete agreements | 99 | |||||||||||||||||||||||||
Intangible asset – customer relationships-distributors | 1,050 | |||||||||||||||||||||||||
Intangible asset – customer relationships-direct | 788 | |||||||||||||||||||||||||
Intangible asset – capitalized software | 526 | |||||||||||||||||||||||||
Goodwill (2) | 12,108 | |||||||||||||||||||||||||
$ | 14,872 | |||||||||||||||||||||||||
(1) The carrying value of accounts receivable and property and equipment acquired approximated fair value; as such, no adjustments to these accounts were recorded in association with the acquisition. | ||||||||||||||||||||||||||
(2) As of September 30, 2013, the amount of goodwill acquired that we expect to be deductible for income tax purposes is $5.6 million. | ||||||||||||||||||||||||||
Unaudited Pro Forma Information for Company Assuming Acquisition | ' | |||||||||||||||||||||||||
The following table presents unaudited pro forma information for the Company assuming the acquisition of Secured had occurred as of January 1, 2012. This pro forma information does not purport to represent what our actual results would have been if the acquisition had occurred as of the date indicated or what such results would be for any future periods. | ||||||||||||||||||||||||||
($ in thousands, except per share data) | ||||||||||||||||||||||||||
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||||||||||||
Revenues | $ | 15,162 | $ | 12,045 | $ | 43,383 | $ | 31,997 | ||||||||||||||||||
Net (loss) income before income taxes | (209 | ) | 1,170 | (5,491 | ) | 4,045 | ||||||||||||||||||||
Net (loss) income | (226 | ) | 1,170 | (5,885 | ) | 4,045 | ||||||||||||||||||||
Net (loss) income attributable to Health Insurance Innovations, Inc. and Health Plan Intermediaries, LLC | (93 | ) | 1,213 | (1,219 | ) | 4,108 | ||||||||||||||||||||
Loss per share – basic | (0.02 | ) | — | (0.26 | ) | — | ||||||||||||||||||||
Loss per share – diluted | (0.02 | ) | — | (0.26 | ) | — | ||||||||||||||||||||
Goodwill_and_Intangible_Assets1
Goodwill and Intangible Assets (Tables) | 9 Months Ended | ||||||||||||||||||
Sep. 30, 2013 | |||||||||||||||||||
Summary of Changes in Carrying Amounts of Goodwill | ' | ||||||||||||||||||
Our goodwill balance as of January 1, 2012 arose from the acquisition of the Naylor units of HPI as described in Note 1. Our goodwill balance as of September 30, 2013 arose from the Secured acquisition described in Note 2 as well as our goodwill balance existing prior to such acquisition. | |||||||||||||||||||
The changes in the carrying amounts of goodwill were as follows ($ in thousands): | |||||||||||||||||||
Balance as of January 1, 2012 | $ | 5,906 | |||||||||||||||||
Goodwill acquired | — | ||||||||||||||||||
Impairment of goodwill | — | ||||||||||||||||||
Balance as of December 31, 2012 | $ | 5,906 | |||||||||||||||||
Goodwill acquired | 12,108 | ||||||||||||||||||
Impairment of goodwill | — | ||||||||||||||||||
Balance as of September 30, 2013 | $ | 18,014 | |||||||||||||||||
Schedule of Major Classes of Intangible Assets | ' | ||||||||||||||||||
Major classes of intangible assets as of September 30, 2013 consisted of the following ($ in thousands): | |||||||||||||||||||
Weighted-average | Gross Carrying | Accumulated | Intangible | ||||||||||||||||
Amortization | Amount | Amortization | Asset, net | ||||||||||||||||
Brand | 2.0 | $ | 476 | $ | (408 | ) | $ | 68 | |||||||||||
Carrier network | 5.0 | 40 | (16 | ) | 24 | ||||||||||||||
Distributor relationships | 8.8 | 4,660 | (1,046 | ) | 3,614 | ||||||||||||||
Noncompete agreements | 4.8 | 942 | (204 | ) | 738 | ||||||||||||||
Customer relationships | 2.0 | 788 | (82 | ) | 706 | ||||||||||||||
Capitalized software | 2.2 | 571 | (65 | ) | 506 | ||||||||||||||
Total intangible assets | 6.6 | $ | 7,477 | $ | (1,821 | ) | $ | 5,656 | |||||||||||
Major classes of intangible assets as of December 31, 2012 consisted of the following: | |||||||||||||||||||
Weighted-average | Gross Carrying | Accumulated | Intangible | ||||||||||||||||
Amortization | Amount | Amortization | Asset, net | ||||||||||||||||
Brand | 2.0 | $ | 400 | $ | (250 | ) | $ | 150 | |||||||||||
Capitalized software | 5.0 | 45 | (4 | ) | 41 | ||||||||||||||
Carrier network | 5.0 | 40 | (10 | ) | 30 | ||||||||||||||
Distributor relationships | 7.0 | 3,610 | (645 | ) | 2,965 | ||||||||||||||
Noncompete agreement | 5.0 | 843 | (70 | ) | 773 | ||||||||||||||
Total intangible assets | 6.2 | $ | 4,938 | $ | (979 | ) | $ | 3,959 | |||||||||||
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense | ' | ||||||||||||||||||
Estimated annual pretax amortization for intangibles assets for 2013 and in each of the next five years are as follows ($ in thousands): | |||||||||||||||||||
Remainder of 2013 | $ | 375 | |||||||||||||||||
2014 | 1,499 | ||||||||||||||||||
2015 | 1,181 | ||||||||||||||||||
2016 | 787 | ||||||||||||||||||
2017 | 689 | ||||||||||||||||||
2018 | 457 | ||||||||||||||||||
Stockbased_Compensation_Tables
Stock-based Compensation (Tables) | 9 Months Ended | |||||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||||
Summary of Weighted Average Assumptions | ' | |||||||||||||||||||
The Black-Scholes option-pricing model was used with the following weighted average assumptions: | ||||||||||||||||||||
Risk-free rate | 1.0 | % | ||||||||||||||||||
Expected life | 4.5 years | |||||||||||||||||||
Volatility | 46.0 | % | ||||||||||||||||||
Expected dividend | none | |||||||||||||||||||
Summary of SARs and Restricted Shares Granted | ' | |||||||||||||||||||
The following table summarizes SARs and restricted shares granted during the three and nine months ended September 30 (in thousands): | ||||||||||||||||||||
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||||||
SARs | Restricted | SARs | Restricted | SARs | Restricted | SARs | Restricted | |||||||||||||
Issued | Shares | Issued | Shares | Issued | Shares | Issued | Shares | |||||||||||||
Issued | Issued | Issued | Issued | |||||||||||||||||
20 | — | — | — | 170 | 543 | — | — | |||||||||||||
Summary of Stock Based Compensation Expenses | ' | |||||||||||||||||||
The following table summarizes stock-based compensation expense for the three and nine months ended September 30, 2013 and 2012 (in thousands): | ||||||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||||||
September 30, | September 30, | |||||||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||||||
SARs | $ | 184 | $ | — | $ | 478 | $ | — | ||||||||||||
Restricted shares | 1,391 | — | 3,798 | — | ||||||||||||||||
$ | 1,575 | $ | — | $ | 4,276 | $ | — | |||||||||||||
Summary of Unrecognized Stock Based Compensation | ' | |||||||||||||||||||
The following table summarizes unrecognized stock-based compensation and the remaining period over which such stock-based compensation is expected to be recognized as of September 30, 2013 (in thousands): | ||||||||||||||||||||
Remaining | ||||||||||||||||||||
years | ||||||||||||||||||||
SARs | $ | 421 | 1.6 | |||||||||||||||||
Restricted shares | 3,698 | 3.7 | ||||||||||||||||||
$ | 4,119 | |||||||||||||||||||
Net_Income_Loss_per_Share_Tabl
Net Income (Loss) per Share (Tables) | 9 Months Ended | |||||||||||||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||||||||||||
Summary of Reconciliation of Numerators and Denominators of Basic and Diluted Net Loss | ' | |||||||||||||||||||||||||||
The computations of basic and diluted net loss per share attributable to Health Insurance Innovations, Inc. for the three and nine months ended September 30, 2013 were as follows (in thousands, except share data): | ||||||||||||||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||||
September 30, 2013 | ||||||||||||||||||||||||||||
Basic net income (loss) attributable to Health Insurance Innovations, Inc. | $ | 408 | $ | (3,684 | ) | |||||||||||||||||||||||
Average shares—basic | 4,795,736 | 4,768,294 | ||||||||||||||||||||||||||
Effect of dilutive securities: | ||||||||||||||||||||||||||||
Restricted shares | 65,600 | — | ||||||||||||||||||||||||||
SARs | — | — | ||||||||||||||||||||||||||
Average shares—diluted | 4,861,336 | 4,768,294 | ||||||||||||||||||||||||||
Basic net income (loss) per share attributable to Health Insurance Innovations, Inc. | $ | 0.09 | $ | (0.77 | ) | |||||||||||||||||||||||
Diluted net income (loss) per share attributable to Health Insurance Innovations, Inc. | $ | 0.08 | $ | (0.77 | ) | |||||||||||||||||||||||
Summary of Securities Not Included in Calculation of Diluted Net Loss | ' | |||||||||||||||||||||||||||
The following securities were not included in the calculation of diluted net loss per share because such inclusion would be anti-dilutive (in thousands): | ||||||||||||||||||||||||||||
Three months ended September 30, | Nine months ended September 30, | |||||||||||||||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||||||||||||||
Restricted shares | 385 | — | 405 | — | ||||||||||||||||||||||||
SARs | 120 | — | 120 | — | ||||||||||||||||||||||||
Fair_Value_Measurements_Tables
Fair Value Measurements (Tables) | 9 Months Ended | |||||||||||||||||||||
Sep. 30, 2013 | ||||||||||||||||||||||
Summary of Short Term Investments, Noncompete Obligation, Notes Payable and Contingent Equity Consideration Measured at Fair Value | ' | |||||||||||||||||||||
As of September 30, 2013, our short-term investments, which include an available-for-sale marketable security (a mutual fund), certificates of deposit with maturities greater than three months to nine months, our noncompete obligation, notes payable and contingent equity consideration measured at fair value were as follows ($ in thousands): | ||||||||||||||||||||||
Carrying Value as of | Fair Value Measurement as of September 30, 2013 | |||||||||||||||||||||
30-Sep-13 | Level 1 | Level 2 | Level 3 | |||||||||||||||||||
Assets: | ||||||||||||||||||||||
Marketable security, available-for-sale | $ | 15,000 | $ | 15,000 | $ | — | $ | — | ||||||||||||||
Certificates of deposit | 6,414 | 6,414 | ||||||||||||||||||||
$ | 21,414 | $ | 21,414 | $ | — | $ | — | |||||||||||||||
Liabilities: | ||||||||||||||||||||||
Noncompete obligation, including current portion | $ | 665 | $ | — | $ | 656 | $ | — | ||||||||||||||
Note payable | 1,718 | — | 1,718 | — | ||||||||||||||||||
Contingent equity consideration | 3,068 | — | 3,068 | — | ||||||||||||||||||
$ | 5,451 | $ | — | $ | 5,442 | $ | — | |||||||||||||||
As of December 31, 2013, our long-term debt and noncompete obligation measured at fair value were as follows ($ in thousands): | ||||||||||||||||||||||
Carrying Value as of | Fair Value Measurement as of December 31, 2012 | |||||||||||||||||||||
31-Dec-12 | Level 1 | Level 2 | Level 3 | |||||||||||||||||||
Liabilities: | ||||||||||||||||||||||
Long-term debt, including current portion | $ | 3,294 | $ | — | $ | 3,314 | $ | — | ||||||||||||||
Noncompete obligation, including current portion | 781 | — | 779 | — | ||||||||||||||||||
$ | 4,075 | $ | — | $ | 4,093 | $ | — | |||||||||||||||
Organization_Basis_of_Presenta2
Organization, Basis of Presentation and Summary of Significant Accounting Policies - Additional Information (Detail) (USD $) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 9 Months Ended | 9 Months Ended | 1 Months Ended | 9 Months Ended | |||||||||
Jul. 17, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Jun. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2011 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | |
Initial public offering | Class A common stock | Class B common stock | Class B Beneficial Ownership | Series B Equity Units | Naylor Acquisition | Naylor Acquisition | HPIH | HPIH | HPIH | HPIH | HPIH | |||||
Vote | Vote | Tax Receivable Agreement | Series A Equity Units | Series A Equity Units | Series A Equity Units | Series A Equity Units | Series A Equity Units | |||||||||
Series B | Initial public offering | Initial public offering | Initial public offering | Initial public offering | ||||||||||||
Economic Interest | Membership Interest | Economic Interest | Voting Interest | Series B | ||||||||||||
Membership Interest | ||||||||||||||||
Organization Basis Of Presentation And Summary Of Significant Accounting Policies [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Ownership percentage | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50.00% | ' | ' | ' | ' | ' |
Units purchased | $10,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | $5,300,000 | ' | ' | ' | ' | ' | ' |
Financing costs of purchase of ownership interests | ' | ' | ' | ' | ' | ' | ' | ' | ' | 135,000 | ' | ' | ' | ' | ' | ' |
Financed a portion of purchase price by entering into a loan agreement with a bank | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4,300,000 | ' | ' | ' | ' | ' | ' |
Percentage of economic rights of holders of all classes of our common stock | ' | ' | ' | ' | ' | 100.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of votes for common stock holders per share | ' | ' | ' | ' | ' | 1 | 1 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Percentage of outstanding common stock owned after IPO | ' | ' | ' | ' | ' | ' | ' | 61.90% | ' | ' | ' | ' | ' | ' | ' | ' |
Number of series outstanding equity | ' | ' | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest owned | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 61.90% | 38.10% | 38.10% | 100.00% | 61.90% |
Percentage of cash savings required to pay under tax receivable agreement | ' | ' | ' | ' | ' | ' | ' | ' | 85.00% | ' | ' | ' | ' | ' | ' | ' |
Cash savings in tax receivable agreements | ' | ' | ' | ' | ' | ' | ' | ' | 15.00% | ' | ' | ' | ' | ' | ' | ' |
Period of exemptions under JOBS Act | ' | '5 years | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Market value of common stock held by non-affiliates | ' | ' | ' | $700,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Indefinite-lived intangible assets impairment likelihood threshold | ' | 50.00% | 50.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Date of sale of stock | ' | ' | ' | ' | 13-Feb-13 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Business_Acquisitions_Addition
Business Acquisitions - Additional Information (Detail) (USD $) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 3 Months Ended | 9 Months Ended | 9 Months Ended | |||||||||||||||||||||
Jul. 17, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Mar. 14, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Jun. 30, 2015 | Sep. 30, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Jun. 30, 2015 | Sep. 30, 2013 | Jul. 17, 2013 | Sep. 30, 2013 | Jul. 17, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2011 | Jun. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Jun. 01, 2012 | Sep. 30, 2013 | Sep. 30, 2013 | Jun. 01, 2012 | |
Secured | Secured | Identified Intangible Assets | Note Payable | Note Payable | Note Payable | Contingent Equity Consideration | Contingent Equity Consideration | Contingent Equity Consideration | HPI | HPI | TSG | TSG | ICE | Controlling Interest | Controlling Interest | Controlling Interest | Noncontrolling Interests | ||||||||||
Maximum | TSG | ICE | |||||||||||||||||||||||||
Business Acquisition Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
The Company received controlling interest at the time of acquisition | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 50.00% | 20.00% | ' | ' | 80.00% | ' | ' | 20.00% |
Capital Contribution | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | $240,000 | ' | ' | $60,000 | ' | $80,000 | $16,000 | $40,000 | $20,000 |
Purchase of outstanding membership units from TSG | ' | 90,000 | ' | ' | ' | ' | 90,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Lease agreement expires | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 30-Apr-15 | ' | ' | ' | ' |
Security deposit | ' | ' | ' | ' | 13,000 | ' | 13,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Contribution to purchase of property and equipment | ' | ' | ' | ' | 15,000 | ' | 15,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Contract termination expense | ' | ' | 5,500,000 | 5,500,000 | ' | ' | 5,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Cash paid at closing | 10,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Contingent acquisition consideration | 6,700,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 2,750,000 | 1,700,000 | 1,671,000 | 3,100,000 | 3,051,000 | 3,750,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Interest rate stated percentage | ' | ' | ' | ' | ' | ' | ' | ' | 5.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Business acquisition due date | ' | ' | ' | ' | ' | ' | 30-Jun-15 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Potential total contingent consideration, minimum | 150,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Potential total contingent consideration, maximum | 9,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Transaction costs related to the acquisition | ' | ' | ' | ' | 107,000 | ' | 301,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amortization of income included in net income | ' | ' | ' | ' | 391,000 | 217,000 | 842,000 | 735,000 | ' | ' | ' | 166,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Revenues | ' | ' | ' | ' | 14,749,000 | 11,644,000 | 40,818,000 | 30,102,000 | ' | 1,300,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Pre-tax net loss | ' | ' | ' | ' | ($309,000) | $894,000 | ($7,355,000) | $2,586,000 | ' | ' | $205,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Business_Acquisitions_Summary_
Business Acquisitions - Summary of Fair Value of Consideration for Acquisition (Detail) (USD $) | 1 Months Ended | |||||||
In Thousands, unless otherwise specified | Jul. 17, 2013 | Jul. 17, 2013 | Jun. 30, 2015 | Sep. 30, 2013 | Jul. 17, 2013 | Sep. 30, 2013 | Jul. 17, 2013 | Jul. 17, 2013 |
Note Payable | Note Payable | Note Payable | Contingent Equity Consideration | Contingent Equity Consideration | Other Contingent Consideration | |||
Business Acquisition Information [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' |
Units purchased | ' | $10,000 | ' | ' | ' | ' | ' | ' |
Contingent acquisition consideration | 6,700 | 6,700 | 2,750 | 1,700 | 1,671 | 3,100 | 3,051 | 150 |
Total consideration | $14,872 | ' | ' | ' | ' | ' | ' | ' |
Business_Acquisitions_Summary_1
Business Acquisitions - Summary of Allocation of Total Purchase Prices for Acquisition (Detail) (USD $) | 1 Months Ended | |
In Thousands, unless otherwise specified | Jul. 17, 2013 | |
Business Acquisition Information [Line Items] | ' | |
Cash | $91 | |
Accounts receivable and other assets | 332 | [1] |
Property and equipment | 128 | [1] |
Accounts payable and accrued expenses | -326 | |
Goodwill | 12,108 | [2] |
Total consideration | 14,872 | |
Brand | ' | |
Business Acquisition Information [Line Items] | ' | |
Intangible asset | 76 | |
Noncompete Agreements | ' | |
Business Acquisition Information [Line Items] | ' | |
Intangible asset | 99 | |
Customer Relationships-Distributors | ' | |
Business Acquisition Information [Line Items] | ' | |
Intangible asset | 1,050 | |
Customer Relationships-Direct | ' | |
Business Acquisition Information [Line Items] | ' | |
Intangible asset | 788 | |
Internally-Developed Software | ' | |
Business Acquisition Information [Line Items] | ' | |
Intangible asset | $526 | |
[1] | The carrying value of accounts receivable and property and equipment acquired approximated fair value; as such, no adjustments to these accounts were recorded in association with the acquisition | |
[2] | As of September 30, 2013, the amount of goodwill acquired that we expect to be deductible for income tax purposes is $5.6 million |
Business_Acquisitions_Unaudite
Business Acquisitions - Unaudited Pro Forma Information for Company Assuming Acquisition (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Per Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Business Acquisition Information [Line Items] | ' | ' | ' | ' |
Revenues | $15,162 | $12,045 | $43,383 | $31,997 |
Net (loss) income before income taxes | -209 | 1,170 | -5,491 | 4,045 |
Net (loss) income | -226 | 1,170 | -5,885 | 4,045 |
Net (loss) income attributable to Health Insurance Innovations, Inc. and Health Plan Intermediaries, LLC | ($93) | $1,213 | ($1,219) | $4,108 |
Loss per share b basic | ($0.02) | ' | ($0.26) | ' |
Loss per share b diluted | ($0.02) | ' | ($0.26) | ' |
Business_Acquisitions_Summary_2
Business Acquisitions - Summary of Allocation of Total Purchase Prices for Acquisition (Parenthetical) (Detail) (USD $) | Sep. 30, 2013 |
In Millions, unless otherwise specified | |
Business Acquisition Information [Line Items] | ' |
Business Acquisition, Goodwill, Expected Tax Deductible Amount | $5.60 |
Goodwill_and_Intangible_Assets2
Goodwill and Intangible Assets - Summary of Changes in Carrying Amounts of Goodwill (Detail) (USD $) | 9 Months Ended | 12 Months Ended |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Dec. 31, 2012 |
Goodwill [Line Items] | ' | ' |
Goodwill Beginning Balance | $5,906 | $5,906 |
Goodwill acquired | 12,108 | ' |
Impairment of goodwill | ' | ' |
Goodwill Ending Balance | $18,014 | $5,906 |
Goodwill_and_Intangible_Assets3
Goodwill and Intangible Assets - Schedule of Major Classes of Intangible Assets (Detail) (USD $) | 9 Months Ended | 12 Months Ended |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Dec. 31, 2012 |
Acquired Finite Lived Intangible Assets [Line Items] | ' | ' |
Weighted-average Amortization | '6 years 7 months 6 days | '6 years 2 months 12 days |
Gross Carrying Amount | $7,477 | $4,938 |
Accumulated Amortization | -1,821 | -979 |
Intangible Asset, net | 5,656 | 3,959 |
Brand | ' | ' |
Acquired Finite Lived Intangible Assets [Line Items] | ' | ' |
Weighted-average Amortization | '2 years | '2 years |
Gross Carrying Amount | 476 | 400 |
Accumulated Amortization | -408 | -250 |
Intangible Asset, net | 68 | 150 |
Carrier network | ' | ' |
Acquired Finite Lived Intangible Assets [Line Items] | ' | ' |
Weighted-average Amortization | '5 years | '5 years |
Gross Carrying Amount | 40 | 40 |
Accumulated Amortization | -16 | -10 |
Intangible Asset, net | 24 | 30 |
Distributor relationships | ' | ' |
Acquired Finite Lived Intangible Assets [Line Items] | ' | ' |
Weighted-average Amortization | '8 years 9 months 18 days | '7 years |
Gross Carrying Amount | 4,660 | 3,610 |
Accumulated Amortization | -1,046 | -645 |
Intangible Asset, net | 3,614 | 2,965 |
Noncompete Agreements | ' | ' |
Acquired Finite Lived Intangible Assets [Line Items] | ' | ' |
Weighted-average Amortization | '4 years 9 months 18 days | '5 years |
Gross Carrying Amount | 942 | 843 |
Accumulated Amortization | -204 | -70 |
Intangible Asset, net | 738 | 773 |
Customer Relationships-Direct | ' | ' |
Acquired Finite Lived Intangible Assets [Line Items] | ' | ' |
Weighted-average Amortization | '2 years | ' |
Gross Carrying Amount | 788 | ' |
Accumulated Amortization | -82 | ' |
Intangible Asset, net | 706 | ' |
Capitalized software | ' | ' |
Acquired Finite Lived Intangible Assets [Line Items] | ' | ' |
Weighted-average Amortization | '2 years 2 months 12 days | '5 years |
Gross Carrying Amount | 571 | 45 |
Accumulated Amortization | -65 | -4 |
Intangible Asset, net | $506 | $41 |
Goodwill_and_Intangible_Assets4
Goodwill and Intangible Assets - Additional Information (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Goodwill [Line Items] | ' | ' | ' | ' |
Amortization of Intangible Assets | $391,000 | $217,000 | $842,000 | $735,000 |
Minimum | ' | ' | ' | ' |
Goodwill [Line Items] | ' | ' | ' | ' |
Finite-Lived Intangible Asset, Useful Life | ' | ' | '2 years | ' |
Maximum | ' | ' | ' | ' |
Goodwill [Line Items] | ' | ' | ' | ' |
Finite-Lived Intangible Asset, Useful Life | ' | ' | '15 years | ' |
Goodwill_and_Intangible_Assets5
Goodwill and Intangible Assets - Schedule of Finite-Lived Intangible Assets, Future Amortization Expense (Detail) (USD $) | Sep. 30, 2013 |
In Thousands, unless otherwise specified | |
Acquired Finite Lived Intangible Assets [Line Items] | ' |
Remainder of 2013 | $375 |
2014 | 1,499 |
2015 | 1,181 |
2016 | 787 |
2017 | 689 |
2018 | $457 |
Deferred_Revenue_Additional_In
Deferred Revenue - Additional Information (Detail) (USD $) | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | ||
Deferred Revenue Arrangement [Line Items] | ' | ' |
Deferred revenue | $863 | $268 |
Debt_Additional_Information_De
Debt - Additional Information (Detail) (USD $) | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||
Feb. 28, 2013 | Sep. 30, 2011 | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | |
Debt [Line Items] | ' | ' | ' | ' | ' | ' |
Bank loan agreement with a principal amount | ' | $4,300,000 | ' | ' | ' | ' |
Fixed interest rate | ' | 5.25% | ' | ' | ' | ' |
Monthly payments for the loan | ' | 81,000 | ' | ' | ' | ' |
Term of bank loan agreement | ' | '5 years | ' | ' | ' | ' |
Interest expense incurred | ' | ' | 0 | 48,000 | 17,000 | 151,000 |
Amortization expense on deferred financing costs | ' | ' | 0 | 11,000 | 7,000 | 34,000 |
Outstanding balance amount repaid | 3,200,000 | ' | ' | ' | ' | ' |
Deferred financing costs written-off to other expense (income) | $71,000 | ' | ' | ' | ' | ' |
HPI | ' | ' | ' | ' | ' | ' |
Debt [Line Items] | ' | ' | ' | ' | ' | ' |
The Company received controlling interest at the time of acquisition | ' | 50.00% | ' | ' | ' | ' |
Stockholders_Equity_Additional
Stockholders' Equity - Additional Information (Detail) (USD $) | 9 Months Ended | |
Sep. 30, 2013 | Feb. 13, 2013 | |
Class Of Stock [Line Items] | ' | ' |
Common stock price | ' | $14 |
Common stock voting rights percentage | 100.00% | ' |
Proceeds from the issuance Class A common stock, amount | $1,300,000 | ' |
Proceeds from the issuance Class A common stock, shares | 100,000 | ' |
Preferred stock, shares authorized | 5,000,000 | ' |
Preferred stock, par value | $0.00 | ' |
Treasury stock, shares | 32,477 | ' |
Treasury Stock, Carrying Cost | $377,000 | ' |
Class A common stock | ' | ' |
Class Of Stock [Line Items] | ' | ' |
Common stock shares | 5,309,594 | 4,666,667 |
Common stock, par value | $0.00 | $0.00 |
Common stock, shares authorized | 100,000,000 | ' |
Class B common stock | ' | ' |
Class Of Stock [Line Items] | ' | ' |
Common stock shares | 8,566,667 | 8,666,667 |
Common stock, par value | $0.00 | ' |
Common stock, shares authorized | 20,000,000 | ' |
HPI | ' | ' |
Class Of Stock [Line Items] | ' | ' |
Common stock shares | ' | 8,580,000 |
HPIS | ' | ' |
Class Of Stock [Line Items] | ' | ' |
Common stock shares | ' | 86,667 |
HII | Class A common stock | ' | ' |
Class Of Stock [Line Items] | ' | ' |
Common stock voting rights percentage | 38.10% | ' |
Economic interest | 100.00% | ' |
HII | Class B common stock | ' | ' |
Class Of Stock [Line Items] | ' | ' |
Common stock voting rights percentage | 61.90% | ' |
Variable_Interest_Entities_Add
Variable Interest Entities - Additional Information (Detail) | 9 Months Ended |
Sep. 30, 2013 | |
Variable Interest Entities Not Consolidated [Line Items] | ' |
Voting power in entity | 100.00% |
Income or loss exposure percentage in VIE | 100.00% |
Minimum | ' |
Variable Interest Entities Not Consolidated [Line Items] | ' |
Total membership interest with voting right | 50.00% |
Maximum | ' |
Variable Interest Entities Not Consolidated [Line Items] | ' |
Total membership interest without voting right | 50.00% |
Stockbased_Compensation_Summar
Stock-based Compensation - Summary of Weighted Average Assumptions (Detail) | 9 Months Ended |
Sep. 30, 2013 | |
Share Based Compensation Arrangement By Share Based Payment Award Weighted Average Assumption [Line Items] | ' |
Risk-free rate | 1.00% |
Expected life | '4 years 6 months |
Volatility | 46.00% |
Expected dividend | ' |
Stockbased_Compensation_Summar1
Stock-based Compensation - Summary of SARs and Restricted Shares Granted (Detail) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Stock Appreciation Rights | ' | ' | ' | ' |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ' | ' | ' | ' |
SARs restricted shares granted | 20 | ' | 170 | ' |
Restricted Shares | ' | ' | ' | ' |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ' | ' | ' | ' |
SARs restricted shares granted | ' | ' | 543 | ' |
Stockbased_Compensation_Summar2
Stock-based Compensation - Summary of Stock-based Compensation Expenses (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ' | ' | ' | ' |
Stock-based compensation expense | $1,575 | ' | $4,276 | ' |
SARs | ' | ' | ' | ' |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ' | ' | ' | ' |
Stock-based compensation expense | 184 | ' | 478 | ' |
Restricted Shares | ' | ' | ' | ' |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ' | ' | ' | ' |
Stock-based compensation expense | $1,391 | ' | $3,798 | ' |
Stockbased_Compensation_Summar3
Stock-based Compensation - Summary of Unrecognized Stock-based Compensation (Detail) (USD $) | 9 Months Ended |
In Thousands, unless otherwise specified | Sep. 30, 2013 |
Unrecognized Stock Based Compensation Expense [Line Items] | ' |
Unrecognized stock-based compensation amount | $4,119 |
Stock Appreciation Rights | ' |
Unrecognized Stock Based Compensation Expense [Line Items] | ' |
Unrecognized stock-based compensation amount | 421 |
Stock-based compensation expense amount expected to be recognized | '1 year 7 months 6 days |
Restricted Shares | ' |
Unrecognized Stock Based Compensation Expense [Line Items] | ' |
Unrecognized stock-based compensation amount | $3,698 |
Stock-based compensation expense amount expected to be recognized | '3 years 8 months 12 days |
Stockbased_Compensation_Additi
Stock-based Compensation - Additional Information (Detail) | Sep. 30, 2013 |
Stock Based Compensation [Line Items] | ' |
Common stock reserved for issuance | 1,250,000 |
Net_Income_Loss_per_Share_Comp
Net Income (Loss) per Share - Computations of Basic and Diluted Net Loss Per Share (Detail) (USD $) | 3 Months Ended | 9 Months Ended | ||
In Thousands, except Share data, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Earnings Loss Per Share [Line Items] | ' | ' | ' | ' |
Basic net income (loss) attributable to Health Insurance Innovations, Inc. | $408 | $937 | ($3,684) | $2,649 |
Average sharesbbasic | 4,795,736 | ' | 4,768,294 | ' |
Average sharesbdiluted | 4,861,336 | ' | 4,768,294 | ' |
Basic net income (loss) per share attributable to Health Insurance Innovations, Inc. | $0.09 | ' | ($0.77) | ' |
Diluted net income (loss) per share attributable to Health Insurance Innovations, Inc. | $0.08 | ' | ($0.77) | ' |
Restricted Shares | ' | ' | ' | ' |
Earnings Loss Per Share [Line Items] | ' | ' | ' | ' |
Dilutive securities | 65,600 | ' | ' | ' |
Stock Appreciation Rights | ' | ' | ' | ' |
Earnings Loss Per Share [Line Items] | ' | ' | ' | ' |
Dilutive securities | ' | ' | ' | ' |
Net_Income_Loss_per_Share_Secu
Net Income (Loss) per Share - Securities Not Included in Diluted Net Loss per Share (Detail) | 3 Months Ended | 9 Months Ended | ||
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 |
Restricted Shares | ' | ' | ' | ' |
Earnings Loss Per Share [Line Items] | ' | ' | ' | ' |
Anti-dilutive securities | 385 | ' | 405 | ' |
Stock Appreciation Rights | ' | ' | ' | ' |
Earnings Loss Per Share [Line Items] | ' | ' | ' | ' |
Anti-dilutive securities | 120 | ' | 120 | ' |
Income_Taxes_Additional_Inform
Income Taxes - Additional Information (Detail) (USD $) | 3 Months Ended | 9 Months Ended |
In Thousands, unless otherwise specified | Sep. 30, 2013 | Sep. 30, 2013 |
Effective tax rate | ' | -6.40% |
(Benefit) provision for income taxes | ($823) | $472 |
Estimate and measure of tax benefit, largest amount likelihood threshold for being realized upon settlement | ' | 50.00% |
Commitments_and_Contingencies_
Commitments and Contingencies - Additional Information (Detail) (USD $) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2013 | Sep. 30, 2012 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | |
Exclusive Option Agreement | ' | ' | ' | ' | ' |
Commitment And Contingencies [Line Items] | ' | ' | ' | ' | ' |
Monthly payment for services agreement for the technology | ' | ' | $16,000 | ' | ' |
Exclusive option agreement maturity term | ' | ' | '5 years | ' | ' |
BimSym Agreements | Software License Arrangement | ' | ' | ' | ' | ' |
Commitment And Contingencies [Line Items] | ' | ' | ' | ' | ' |
System purchase amount | ' | ' | 45,000 | ' | ' |
BimSym Agreements | Computer Software, Intangible Asset | ' | ' | ' | ' | ' |
Commitment And Contingencies [Line Items] | ' | ' | ' | ' | ' |
Amount capitalized for software | 45,000 | ' | 45,000 | ' | ' |
BimSym Agreements | Master Service Agreements | ' | ' | ' | ' | ' |
Commitment And Contingencies [Line Items] | ' | ' | ' | ' | ' |
Monthly payment for services agreement for the technology | ' | ' | 26,000 | ' | ' |
Service agreement term | ' | ' | '5 years | ' | ' |
Agreement renewal | ' | ' | 'one-year terms unless 60 daysb | ' | ' |
Office Equipment | ' | ' | ' | ' | ' |
Commitment And Contingencies [Line Items] | ' | ' | ' | ' | ' |
Operating lease expires | ' | ' | '2015 | ' | ' |
Difference between cash rent payments and straight-line rent expense | ' | ' | 68,000 | ' | 63,000 |
Operating lease rental expense | $96,000 | $74,000 | $210,000 | $132,000 | ' |
HPIH | ' | ' | ' | ' | ' |
Commitment And Contingencies [Line Items] | ' | ' | ' | ' | ' |
Lease agreement expires | ' | ' | '2017 | ' | ' |
ICE | ' | ' | ' | ' | ' |
Commitment And Contingencies [Line Items] | ' | ' | ' | ' | ' |
Lease agreement expires | ' | ' | '2015 | ' | ' |
Secured | ' | ' | ' | ' | ' |
Commitment And Contingencies [Line Items] | ' | ' | ' | ' | ' |
Lease agreement expires | ' | ' | '2014 | ' | ' |
Fair_Value_Measurements_Summar
Fair Value Measurements - Summary of Short Term Investments, Noncompete Obligation, Notes Payable and Contingent Equity Consideration Measured at Fair Value (Detail) (USD $) | Sep. 30, 2013 | Jul. 17, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Dec. 31, 2012 | Sep. 30, 2013 | Dec. 31, 2012 |
In Thousands, unless otherwise specified | Fair Value Measurement Level 1 | Fair Value Measurement Level 2 | Fair Value Measurement Level 2 | Carrying Value | Carrying Value | ||
Assets | ' | ' | ' | ' | ' | ' | ' |
Marketable security, available-for-sale | ' | ' | $15,000 | ' | ' | $15,000 | ' |
Certificates of deposit | ' | ' | 6,414 | ' | ' | 6,414 | ' |
Short-term investments | 21,414 | ' | 21,414 | ' | ' | 21,414 | ' |
Liabilities: | ' | ' | ' | ' | ' | ' | ' |
Noncompete obligation, including current portion | ' | ' | ' | 656 | 779 | 665 | 781 |
Note payable | ' | ' | ' | 1,718 | ' | 1,718 | ' |
Contingent acquisition consideration | ' | 6,700 | ' | 3,068 | ' | 3,068 | ' |
Liabilities | ' | ' | ' | 5,442 | ' | 5,451 | ' |
Long-term debt, including current portion | ' | ' | ' | ' | 3,314 | ' | 3,294 |
Noncompete obligation, fair value | ' | ' | ' | ' | $4,093 | ' | $4,075 |
Segments_Additional_Informatio
Segments - Additional Information (Detail) | 9 Months Ended |
Sep. 30, 2013 | |
Segment | |
Segment Reporting Information [Line Items] | ' |
Number of Operating Segments | 1 |
Related_Party_Transactions_Add
Related Party Transactions - Additional Information (Detail) (USD $) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | 3 Months Ended | 9 Months Ended | ||||||||||
Jun. 30, 2013 | Mar. 31, 2013 | Mar. 14, 2013 | Feb. 11, 2013 | Aug. 31, 2012 | Mar. 31, 2013 | Sep. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2012 | Feb. 01, 2013 | Jan. 02, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | Mar. 31, 2013 | Sep. 30, 2013 | Sep. 30, 2013 | |
IPO Underwriters' Option | HPIH | HPIH | HPIH | Tax Receivable Agreement | ||||||||||||
Related Party Transaction [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amount of distributions paid | ' | ' | ' | $171,000 | ' | ' | $1,617,000 | $2,763,000 | $4,010,000 | ' | ' | ' | $74,000 | $944,000 | $1,600,000 | ' |
Amount granted to related parties supported by promissory note | ' | ' | ' | ' | 100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Monthly payments due under note payable | ' | ' | ' | ' | ' | ' | ' | ' | ' | 25,000 | 25,000 | ' | ' | ' | ' | ' |
Due to related parties | ' | ' | ' | ' | ' | ' | ' | ' | 50,000 | ' | ' | ' | ' | ' | ' | ' |
Repayment of due to related parties | ' | ' | ' | ' | ' | 50,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Aggregate cash price of assets | ' | 5,500,000 | 5,500,000 | ' | ' | ' | 5,500,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Purchase of outstanding membership units from TSG | 90,000 | ' | ' | ' | ' | ' | 90,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amount paid under agreement | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 0 |
Due to related parties | ' | ' | ' | ' | ' | ' | $374,000 | ' | ' | ' | ' | ' | ' | ' | ' | $374,000 |
Common stock, shares issued | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 100,000 | ' | ' | ' | ' |