Benefitfocus (BNFT) 10-Q 3 Aug 15 2015 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2015	Jul. 31, 2015
Document Information [Line Items]
Document Type	10-Q
Amendment Flag	false
Document Period End Date	Jun. 30, 2015
Document Fiscal Year Focus	2,015
Document Fiscal Period Focus	Q2
Trading Symbol	BNFT
Entity Registrant Name	Benefitfocus,Inc.
Entity Central Index Key	1,576,169
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Entity Common Stock, Shares Outstanding		28,768,986

Consolidated Balance Sheets

Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Current assets:
Cash and cash equivalents	$ 40,424	$ 51,074
Marketable securities	48,091	5,135
Accounts receivable, net	20,322	21,311
Accounts receivable, related party	1,603
Prepaid expenses and other current assets	5,765	4,242
Total current assets	116,205	81,762
Property and equipment, net	54,060	54,021
Intangible assets, net	798	951
Goodwill	1,634	1,634
Other non-current assets	1,507	1,650
Total assets	174,204	140,018
Current liabilities:
Accounts payable	6,835	5,589
Accrued expenses	7,332	9,171
Accrued compensation and benefits	19,242	17,374
Deferred revenue, current portion	31,446	20,384
Financing and capital lease obligations, current portion	4,142	4,197
Total current liabilities	68,997	56,715
Deferred revenue, net of current portion	62,776	74,126
Revolving line of credit, net of current portion	5,246	17,657
Financing and capital lease obligations, net of current portion	31,257	32,240
Other non-current liabilities	2,292	2,103
Total liabilities	$ 170,568	$ 182,841
Commitments and contingencies
Stockholders' equity (deficit):
Preferred stock, par value $0.001, 5,000,000 shares authorized, no shares issued and outstanding at June 30, 2015 and December 31, 2014
Common stock, par value $0.001, 50,000,000 shares authorized, 28,723,308 and 25,608,937 shares issued and outstanding at June 30, 2015 and December 31, 2014, respectively	$ 29	$ 26
Additional paid-in capital	302,798	223,409
Accumulated deficit	(299,191)	(266,258)
Total stockholders' equity (deficit)	3,636	(42,823)
Total liabilities and stockholders' equity (deficit)	$ 174,204	$ 140,018

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) - $ / shares	Jun. 30, 2015	Dec. 31, 2014
Preferred stock, par value	$ 0.001	$ 0.001
Preferred stock, shares authorized	5,000,000	5,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value	$ 0.001	$ 0.001
Common stock, shares authorized	50,000,000	50,000,000
Common stock, shares issued	28,723,308	25,608,937
Common stock, shares outstanding	28,723,308	25,608,937

Consolidated Statements of Oper

Consolidated Statements of Operations and Comprehensive Loss - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Revenue	$ 42,708	$ 32,337	$ 85,377	$ 63,033
Cost of revenue	23,640	21,037	46,103	40,263
Gross profit	19,068	11,300	39,274	22,770
Operating expenses:
Sales and marketing	15,804	14,067	31,279	25,054
Research and development	13,271	10,372	25,048	19,150
General and administrative	6,393	4,272	11,804	7,801
Total operating expenses	35,468	28,711	68,131	52,005
Loss from operations	(16,400)	(17,411)	(28,857)	(29,235)
Other income (expense):
Interest income	56	24	74	50
Interest expense on building lease financing obligations	(1,730)	(648)	(3,644)	(1,107)
Interest expense on other borrowings	(210)	(149)	(490)	(278)
Other income (expense)	5	(1)	4	(3)
Total other expense, net	(1,879)	(774)	(4,056)	(1,338)
Loss before income taxes	(18,279)	(18,185)	(32,913)	(30,573)
Income tax expense	5	15	20	29
Net loss	(18,284)	(18,200)	(32,933)	(30,602)
Comprehensive loss	$ (18,284)	$ (18,200)	$ (32,933)	$ (30,602)
Net loss per common share:
Basic and diluted	$ (0.64)	$ (0.72)	$ (1.19)	$ (1.23)
Weighted-average common shares outstanding:
Basic and diluted	28,633,992	25,200,093	27,694,935	24,872,545

Consolidated Statements of Chan

Consolidated Statements of Changes in Stockholders' (Deficit) Equity - 6 months ended Jun. 30, 2015 - USD ($) $ in Thousands	Total	Common Stock, $0.001 Par Value	Additional Paid-in Capital	Accumulated Deficit
Balance (in shares) at Dec. 31, 2014		25,608,937
Balance at Dec. 31, 2014	$ (42,823)	$ 26	$ 223,409	$ (266,258)
Exercise of stock options (in shares)		239,383
Exercise of stock options	1,318		1,318
Issuance of common stock upon vesting of restricted stock units, net of shares surrendered for taxes	(874)		(874)
Issuance of common stock upon vesting of restricted stock units, net of shares surrendered for taxes (in shares)		57,462
Issuance of common stock and warrant, net of issuance costs	74,331	$ 3	74,328
Issuance of common stock and warrant, net of issuance costs (in shares)		2,817,526
Stock-based compensation expense	4,617		4,617
Net loss	(32,933)			(32,933)
Balance (in shares) at Jun. 30, 2015		28,723,308
Balance at Jun. 30, 2015	$ 3,636	$ 29	$ 302,798	$ (299,191)

Consolidated Statements of Cash

Consolidated Statements of Cash Flows - Entity [Domain] - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014
Cash flows from operating activities
Net loss	$ (32,933)	$ (30,602)
Adjustments to reconcile net loss to net cash and cash equivalents used in operating activities:
Depreciation and amortization	5,726	5,000
Stock-based compensation expense	4,617	1,891
Change in fair value and accretion of warrant		446
Interest accrual on financing obligation	3,644	1,107
Loss on disposal or impairment of property and equipment	8	5
Changes in operating assets and liabilities:
Accounts receivable, net	(614)	2,301
Accrued interest on short-term investments	88	93
Prepaid expenses and other current assets	(1,523)	(368)
Other non-current assets	711	293
Accounts payable	1,427	(2,055)
Accrued expenses	648	125
Accrued compensation and benefits	1,868	4,900
Deferred revenue	(495)	8,977
Other non-current liabilities	189	662
Net cash and cash equivalents used in operating activities	(16,639)	(7,225)
Cash flows from investing activities
Purchases of short-term investments held to maturity	(51,111)	(12,959)
Proceeds from maturity of short-term investments held to maturity	8,067	9,566
Purchases of property and equipment	(8,054)	(3,730)
Net cash and cash equivalents used in investing activities	(51,098)	(7,123)
Cash flows from financing activities
Draws on revolving line of credit	22,492	7,000
Payments on revolving line of credit	(34,903)
Proceeds from exercises of stock options	1,318	2,244
Proceeds from issuance of common stock and warrant, net of issuance costs	74,538
Payments of deferred financing costs and debt issuance costs	(566)
Remittance of taxes upon vesting of restricted stock units	(874)
Payments on financing and capital lease obligations	(4,918)	(5,316)
Net cash and cash equivalents provided by financing activities	57,087	3,928
Net decrease in cash and cash equivalents	(10,650)	(10,420)
Cash and cash equivalents, beginning of period	51,074	65,645
Cash and cash equivalents, end of period	40,424	55,225
Supplemental disclosure of non-cash investing and financing activities
Property and equipment purchases in accounts payable and accrued expenses	1,558	772
Property and equipment purchased with financing and capital lease obligations	236	10,646
Post contract support purchased with financing obligations		$ 604
Allocation of proceeds to deferred revenue from issuance of common stock based on relative selling price	$ 207

Organization and Description of

Organization and Description of Business	6 Months Ended
	Jun. 30, 2015
Organization and Description of Business	1. Organization and Description of Business Benefitfocus, Inc. (the “Company”) is a leading provider of cloud-based benefits software solutions for consumers, employers, insurance carriers and brokers delivered under a software-as-a-service (SaaS) model. The financial statements of the Company include the financial position and operations of its wholly owned subsidiaries, Benefitfocus.com, Inc., Benefit Informatics, Inc. and BenefitStore, Inc.

Summary of Significant Accounti

Summary of Significant Accounting Policies	6 Months Ended
	Jun. 30, 2015
Summary of Significant Accounting Policies	2. Summary of Significant Accounting Policies Principles of Consolidation These unaudited consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). The unaudited consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. The Company is not the primary beneficiary of, nor does it have a controlling financial interest in, any variable interest entity. Accordingly, the Company has not consolidated any variable interest entity. Interim Unaudited Consolidated Financial Information The accompanying unaudited consolidated financial statements and footnotes have been prepared in accordance with GAAP as contained in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (the “Codification” or “ASC”) for interim financial information, and with Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, the interim financial information includes all adjustments of a normal recurring nature necessary for a fair presentation of the results of operations, financial position, changes in stockholders’ equity and cash flows. The results of operations for the three- and six-month periods ended June 30, 2015 are not necessarily indicative of the results for the full year or the results for any other future period. These unaudited consolidated financial statements should be read in conjunction with the audited financial statements and related footnotes for the year ended December 31, 2014 included in the Company’s Annual Report on Form 10-K filed with the United States Securities and Exchange Commission on February 27, 2015. Use of Estimates The preparation of financial statements in conformity with GAAP requires the Company to make estimates and assumptions that affect the reported amounts in the consolidated financial statements and accompanying notes. Such estimates include revenue recognition and the customer relationship period, allowances for doubtful accounts and returns, valuations of deferred income taxes, long-lived assets and warrants, the useful lives of assets, capitalizable software development costs and the related amortization, contingent consideration, stock-based compensation, annual bonus attainment, and the recognition and impairment of acquired intangibles and goodwill. Determination of these transactions and account balances are based on the Company’s estimates and judgments. These estimates are based on the Company’s knowledge of current events and actions it might undertake in the future as well as on various other assumptions that it believes to be reasonable. Actual results could differ from these estimates. Revenue and Deferred Revenue The Company derives the majority of its revenue from software services fees, which consist primarily of monthly subscription fees paid by customers for access to and usage of the Company’s cloud-based benefits software solutions for a specified contract term. The Company also derives revenue from professional services which primarily include fees related to the integration of customers’ systems with the Company’s platform, which typically includes discovery, configuration, deployment, testing, and training. The Company recognizes revenue when there is persuasive evidence of an arrangement, the service has been provided, the fees to be paid by the customer are fixed and determinable and collectability is reasonably assured. The Company considers delivery of its cloud-based software services has commenced once it has granted the customer access to its platform. The Company’s arrangements generally contain multiple elements comprised of software services and professional services. The Company evaluates each element in an arrangement to determine whether it represents a separate unit of accounting. An element constitutes a separate unit of accounting when the delivered item has standalone value and delivery of the undelivered element is probable and within the Company’s control. The Company’s professional services are not sold separately from the software services and there is no alternative use for them. As such, the Company has determined that the professional services do not have standalone value. Accordingly, software services and professional services are combined and recognized as a single unit of accounting. The Company generally recognizes software services fees monthly based on the number of employees covered by the relevant benefits plans at contracted rates for a specified period of time, once the criteria for revenue recognition described above have been satisfied. The Company defers recognition of revenue for professional services fees and begins recognizing such revenue once the services are performed and the related software services have commenced, ratably over the longer of the contract term or the estimated expected life of the customer relationship. Costs incurred by the Company in connection with providing such professional services are charged to expense as incurred and are included in “Cost of revenue.” In January 2015, the Company adjusted the estimated expected life of its customer relationship. This change in estimate was the result of analyzing quantitative and qualitative observations in the market and the Company’s business. This change shortened the term over which deferred revenue is recognized from 10 to 7 years and was applied prospectively to unamortized professional services fees over the longer of the contract term or the adjusted estimated expected life of the customer relationship. The change in the customer relationship period increased the amount of revenue recognized during the three and six months ended June 30, 2015, which decreased loss from continuing operations and net loss by $1,499 and $3,199, respectively, and decreased our loss per share by $0.05 and $0.12 for the three- and six-month periods ended June 30, 2015, respectively. As a result of the change in the customer relationship period, Carrier and Employer revenue increased by $1,198 and $301, respectively, for the three months ended June 30, 2015, and $2,646 and $553, respectively, for the six months ended June 30, 2015. As of July 1, 2015, the Company determined that it had established standalone value for the implementation services for the Benefitfocus Marketplace solution in the Employer segment. This was primarily due to the system integrators that have been trained and certified to perform these implementation services, the successful completion of an implementation by a trained system integrator, and the sale of several software subscription arrangements to customers in the Employer segment without the Company’s implementation services. Accordingly, implementation services related to the Benefitfocus Marketplace solution in the Employer segment that are delivered after July 1, 2015 will be recognized separately from the revenues earned from the Employer software subscription services. Concentrations of Credit Risk The Company’s financial instruments that are exposed to concentrations of credit risk consist primarily of cash equivalents, marketable securities and accounts receivable. All of the Company’s cash and cash equivalents are held at financial institutions that management believes to be of high credit quality. The bank deposits of the Company might, at times, exceed federally insured limits and are generally uninsured and uncollateralized. The Company has not experienced any losses on cash and cash equivalents to date. To manage credit risk related to marketable securities, the Company invests in various types of highly rated corporate bonds, commercial paper, and various United States backed securities with maturities of less than two years. The weighted average maturity of the portfolio of investments must not exceed nine months, per the Company’s investment policy. To manage accounts receivable risk, the Company evaluates the creditworthiness of its customers and maintains an allowance for doubtful accounts. Accounts receivable were unsecured and were derived from revenue earned from customers located in the United States. Accounts receivable from one customer, Aetna, represented 10.0% and 13.3%, of the total accounts receivable at June 30, 2015 and December 31, 2014, respectively. One customer, Aetna, represented 10.0% of total revenue for the three- and six-month periods ended June 30, 2015. No customer represented more than 10% of total revenue for the three- and six-month periods ended June 30, 2014. Accounts Receivable and Allowance for Doubtful Accounts and Returns Accounts receivable is stated at realizable value, net of allowances for doubtful accounts and returns. The Company utilizes the allowance method to provide for doubtful accounts based on management’s evaluation of the collectability of amounts due and other relevant factors. Bad debt expense is recorded in general and administrative expense on the unaudited consolidated statements of operations and comprehensive loss. The Company’s estimate is based on historical collection experience and a review of the current status of accounts receivable. Historically, actual write-offs for uncollectible accounts have not significantly differed from the Company’s estimates. The Company removes recorded receivables and the associated allowances when they are deemed permanently uncollectible. However, higher than expected bad debts could result in write-offs that are greater than the Company’s estimates. The allowance for doubtful accounts was $10 as of both June 30, 2015 and December 31, 2014. The allowances for returns are accounted for as reductions of revenue and are estimated based on the Company’s periodic assessment of historical experience and trends. The Company considers factors such as the time lag since the initiation of revenue recognition, historical reasons for adjustments, new customer volume, complexity of billing arrangements, timing of software availability, and past due customer billings. The allowance for returns was $1,646 and $1,653 as of June 30, 2015 and December 31, 2014, respectively. Capitalized Software Development Costs The Company capitalizes certain costs related to its software developed or obtained for internal use. Costs related to preliminary project activities and post-implementation activities are expensed as incurred. Internal and external costs incurred during the application development stage, including upgrades and enhancements representing modifications that will result in significant additional functionality, are capitalized. Software maintenance and training costs are expensed as incurred. Capitalized costs are recorded as part of property and equipment and are amortized on a straight-line basis over the software’s estimated useful life which is three years. The Company evaluates these assets for impairment whenever events or changes in circumstances occur that could impact the recoverability of these assets. In the three months ended June 30, 2015 and 2014, the Company capitalized software development costs of $506 and $503, and amortized capitalized software development costs of $671 and $768, respectively. In the six months ended June 30, 2015 and 2014, the Company capitalized software development costs of $1,051 and $938, and amortized capitalized software development costs of $1,347 and $1,463, respectively. The net book value of capitalized software development costs was $3,838 and $4,134 at June 30, 2015 and December 31, 2014, respectively. Comprehensive Loss The Company’s net loss equals comprehensive loss for all periods presented. Accounting Standards Not Yet Adopted In May 2014, the FASB issued ASU No. 2014-09 “Revenue from Contracts with Customers”, which amends the revenue recognition requirements in the FASB Accounting Standards Codification (ASC). This statement requires that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The statement shall be applied using one of two methods: retrospectively to each prior reporting period presented, or retrospectively with the cumulative effect of initially applying this statement recognized at the date of initial application. The Company has not yet determined which method it will apply. In July 2015, FASB approved the deferral of the effective date of this guidance by one year. As a result, this guidance will be effective for the Company beginning January 1, 2018, with an option to early adopt. The Company is currently evaluating the impact of this guidance on the Company’s consolidated financial position and results of operations. In April 2015, the FASB issued ASU No. 2015-03, “Interest—Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs.” The amendments in this ASU require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. This guidance is effective for annual and interim reporting periods of public entities beginning after December 15, 2015, and early adoption is permitted. The Company is currently evaluating the impact of this statement on its consolidated financial position.

Net Loss Per Common Share

Net Loss Per Common Share	6 Months Ended
	Jun. 30, 2015
Net Loss Per Common Share	3. Net Loss Per Common Share Diluted loss per common share is the same as basic loss per common share for all periods presented because the effects of potentially dilutive items were anti-dilutive given the Company’s net loss. The following common share equivalent securities have been excluded from the calculation of weighted average common shares outstanding because the effect is anti-dilutive for the periods presented: Three Months Ended June 30, Six Months Ended June 30, Anti-Dilutive Common Share Equivalents 2015 2014 2015 2014 Restricted stock units 998,889 369,707 998,889 369,707 Stock options 2,134,685 2,563,379 2,134,685 2,563,379 Warrant to purchase common stock 580,813 — 580,813 — Total anti-dilutive common share equivalents 3,714,387 2,933,086 3,714,387 2,933,086 Basic and diluted net loss per common share is calculated as follows: Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Numerator: Net loss $ (18,284 ) $ (18,200 ) $ (32,933 ) $ (30,602 ) Net loss attributable to common stockholders $ (18,284 ) $ (18,200 ) $ (32,933 ) $ (30,602 ) Denominator: Weighted-average common shares outstanding, basic and diluted 28,633,992 25,200,093 27,694,935 24,872,545 Net loss per common share, basic and diluted $ (0.64 ) $ (0.72 ) $ (1.19 ) $ (1.23 )

Fair Value Measurement

Fair Value Measurement	6 Months Ended
	Jun. 30, 2015
Fair Value Measurement	4. Fair Value Measurement The carrying amounts of certain of the Company’s financial instruments, including cash and cash equivalents, net accounts receivable, accounts payable and other accrued liabilities, and accrued compensation and benefits, approximate fair value due to their short-term nature. The carrying value of the Company’s financing obligations and revolving line of credit approximates fair value, considering the borrowing rates currently available to the Company with similar terms and credit risks. The Company uses a three-tier fair value hierarchy to classify and disclose all assets and liabilities measured at fair value on a recurring basis, as well as assets and liabilities measured at fair value on a non-recurring basis, in periods subsequent to their initial measurement. The hierarchy requires the Company to use observable inputs when available, and to minimize the use of unobservable inputs when determining fair value. The three tiers are defined as follows: Level 1. Quoted prices (unadjusted) in active markets for identical assets or liabilities. Level 2. Other inputs that are directly or indirectly observable in the marketplace. Level 3. Unobservable inputs for which there is little or no market data, which require the Company to develop its own assumptions. Assets and Liabilities Measured at Fair Value on a Recurring Basis The Company evaluates its financial assets and liabilities subject to fair value measurements on a recurring basis to determine the appropriate level to classify them for each reporting period. This determination requires significant judgments to be made. The following tables present information about the Company’s assets and liabilities that are measured at fair value on a recurring basis using the above categories, as of June 30, 2015 and December 31, 2014. June 30, 2015 Description Level 1 Level 2 Level 3 Total Cash Equivalents: Money market mutual funds (1) $ 39,038 $ — $ — $ 39,038 Total assets $ 39,038 $ — $ — $ 39,038 December 31, 2014 Description Level 1 Level 2 Level 3 Total Cash Equivalents: Money market mutual funds (1) $ 50,695 $ — $ — $ 50,695 Total assets $ 50,695 $ — $ — $ 50,695 (1) Money market funds are classified as cash equivalents in the Company’s unaudited consolidated balance sheets. As short-term, highly liquid investments readily convertible to known amounts of cash, with remaining maturities of three months or less at the time of purchase, the Company’s cash equivalent money market funds have carrying values that approximate fair value.

Marketable Securities

Marketable Securities	6 Months Ended
	Jun. 30, 2015
Marketable Securities	5. Marketable Securities Marketable securities consist of corporate bonds, commercial paper, U.S. Treasury and agency bonds and are classified as held-to-maturity. The amortized cost basis and net carrying amount of marketable securities was $48,091 and $5,135 and the aggregate fair value, determined by level 2 inputs, was $48,063 and $5,134, as of June 30, 2015 and December 31, 2014, respectively. The gross unrealized holding gains were $5 and $0 and the gross unrealized losses were $33 and $1, as of June 30, 2015 and December 31, 2014, respectively. Corporate bonds held in marketable securities had contractual maturities of between 1 and 10 months as of June 30, 2015. The primary valuation techniques the Company utilizes to determine fair value of marketable securities are calculated prices and evaluated prices. These techniques incorporate data from several sources to determine the price of a security such as accreted value, market data, trade observations, pricing models and systems. The following table presents information about the Company’s investments that were in an unrealized loss position and for which an other-than-temporary impairment has not been recognized in earnings as of: June 30, 2015 December 31, 2014 Aggregate fair value of investments with unrealized losses (1) $ 28,902 $ 5,135 Aggregate amount of unrealized losses (33 ) (1 ) (1) Investments have been in a continuous loss position for less than 12 months

Property and Equipment

Property and Equipment	6 Months Ended
	Jun. 30, 2015
Property and Equipment	6. Property and Equipment Property and equipment consists of the following as of: June 30, 2015 December 31, 2014 Buildings, leased $ 26,444 $ 7,965 Computers and related equipment 21,039 18,871 Purchased software and licenses 21,288 20,392 Software developed 19,448 18,397 Furniture and fixtures 6,510 3,834 Leasehold improvements 6,764 3,334 Other equipment 3,044 2,009 Vehicles 111 111 Construction in progress 118 24,296 Total property and equipment, at cost 104,766 99,209 Accumulated depreciation and amortization (50,706 ) (45,188 ) Property and equipment, net $ 54,060 $ 54,021

Revolving Line of Credit and Se

Revolving Line of Credit and Senior Revolving Line of Credit	6 Months Ended
	Jun. 30, 2015
Revolving Line of Credit and Senior Revolving Line of Credit	7. Revolving Line of Credit and Senior Revolving Line of Credit In February 2015, the Company replaced its then existing revolving line of credit (“Revolver”) with a senior revolving line of credit (“Senior Revolver”) with a syndicate of lenders led by Silicon Valley Bank. The Company borrowed $18,246 under the Senior Revolver, of which $17,657 repaid the principal of the Revolver and $589 paid accrued interest, as well as administrative and legal fees related to the issuance of the Senior Revolver. The debt issuance fees were capitalized in the Company’s balance sheet and will be amortized over the life of the Senior Revolver. The three-year Senior Revolver has a borrowing limit of $60,000. Borrowing capacity under the Senior Revolver is subject to a borrowing base limit that is a function of the Company’s monthly recurring revenue as adjusted to reflect lost customer revenue during the previous three calendar months. Therefore, credit available under the Senior Revolver may be less than the $60,000 borrowing limit. Interest is payable monthly. Advances under the Senior Revolver bear interest at the prime rate as published in the Wall Street Journal plus a margin based on the Company’s liquidity that ranges between 1.0% and 1.5%. The Company is charged for amounts unused under this arrangement at a rate based on its liquidity of 0.300% to 0.375% per year. Any outstanding principal is due at the end of the term. The Company is bound by customary affirmative and negative covenants in connection with the Senior Revolver, including financial covenants related to liquidity and EBITDA. In the event of a default, the lenders may declare all obligations immediately due and stop advancing money or extending credit under the line of credit. The line of credit is collateralized by substantially all of the Company’s tangible and intangible assets, including intellectual property and the equity of subsidiaries. Later in February 2015, the Company repaid $13,246 under this line of credit. In March 2015, the Company borrowed $4,246 for general operating purposes. In April 2015, the Company repaid $4,000 under this line of credit. As of June 30, 2015, the amount outstanding under this line of credit was $5,246 and the amount available to borrow, adjusted by the borrowing base limit, was $45,291.

Commitments and Contingencies

Commitments and Contingencies	6 Months Ended
	Jun. 30, 2015
Commitments and Contingencies	8. Commitments and Contingencies Financing and Capital Lease Obligations During January 2015, the Company began to occupy additional office space constructed under a 15-year build-to-suit lease signed in December 2013. During the construction of the premises, the Company was deemed the “owner” for accounting purposes due to its extensive involvement in the construction process. Upon completion, the Company was also deemed the “owner” for accounting purposes due to its continuing involvement. As such, costs included in construction-in-progress for the building and related assets were recorded in “Property and equipment, net” and the related financing obligation remained recorded in the Company’s consolidated balance sheets. As of June 30, 2015, the financing obligation related to this lease was $21,200.

Stock-based Compensation

Stock-based Compensation	6 Months Ended
	Jun. 30, 2015
Stock-based Compensation	9. Stock-based Compensation Restricted Stock Units During January 2015, the Company granted 26,050 restricted stock units to employees with an aggregate grant date fair value of $815. During April 2015, the Company granted 401,043 restricted stock units to employees with an aggregate grant date fair value of $14,377. These restricted stock units vest in equal annual installments generally over 4 years from the grant date. The Company amortizes the fair value of the stock subject to the restricted stock units at the time of grant on a straight-line basis over the period of vesting. The Company recognizes the income tax benefits resulting from vesting of restricted stock units in the period they vest, to the extent the compensation expense has been recognized.

Stockholders' Equity (Deficit)

Stockholders' Equity (Deficit)	6 Months Ended
	Jun. 30, 2015
Stockholders' Equity (Deficit)	10. Stockholders’ Equity (Deficit) Common Stock The holders of common stock are entitled to one vote for each share. The voting, dividend and liquidation rights of the holders of common stock are subject to and qualified by the rights, powers and preferences of the holders of preferred stock. At June 30, 2015, the Company had reserved a total of 5,330,056 of its authorized 50,000,000 shares of common stock for future issuance as follows: Outstanding stock options 2,134,685 Restricted stock units 998,889 Possible future issuance under stock option plans 1,615,669 Warrant to purchase common stock 580,813 Total common shares reserved for future issuance 5,330,056 On February 24, 2015 and in conjunction with the amendment to the commercial contract described in Note 13, the Company entered into a Securities Purchase Agreement to sell shares of its common stock to Mercer, LLC (“Mercer”), a customer of the Company. Pursuant to the agreement, on the same date, the Company sold 2,817,526 shares of its common stock to Mercer for $26.50 per share or an aggregate of $74,664. At the same time, the Company also issued Mercer a warrant to purchase up to an additional 580,813 shares of its common stock for $26.50 per share at any time during the 30-month term of the warrant. The agreement, among other things, includes certain standstill provisions and prevents Mercer from disposing of its shares of Company common stock until the earlier of December 31, 2017, the expiration or termination of the Mercer Exchange Software as a Service Agreement, as amended between the Company and Mercer Health & Benefits, LLC, the date on which Mercer and its affiliates own less than 75% of the shares it purchased pursuant to the Securities Purchase Agreement, and the date on which Mercer and its affiliates own less than 5% of the outstanding common stock of the Company. The Company received all of the proceeds from this sale of shares and will use the proceeds for working capital and other general corporate purposes. The Stock Purchase Agreement, warrant agreement and amended commercial contract are considered part of a single arrangement and accounted for in accordance with the multiple-element arrangement guidance outlined in ASC 605-25, Revenue: Multiple-Element Arrangements

Income Taxes

Income Taxes	6 Months Ended
	Jun. 30, 2015
Income Taxes	11. Income Taxes The Company’s effective federal tax rate for the three- and six-months ended June 30, 2015 was less than one percent, primarily as a result of estimated tax losses for the fiscal year offset by the increase in the valuation allowance on the net operating loss carryforwards. Current tax expense relates to estimated state income taxes.

Segments and Geographic Informa

Segments and Geographic Information	6 Months Ended
	Jun. 30, 2015
Segments and Geographic Information	12. Segments and Geographic Information Operating segments are defined as components of an enterprise for which discrete financial information is available that is evaluated regularly by the chief operating decision maker (“CODM”) for purposes of allocating resources and evaluating financial performance. The Company’s CODM, the Chief Executive Officer, reviews financial information presented on a consolidated basis, accompanied by information about operating segments, for purposes of allocating resources and evaluating financial performance. The Company’s reportable segments are based on the type of customer. The Company determined its operating segments to be: Employer, which derives substantially all of its revenue from customers that use the Company’s services for the provision of benefits to their employees, and administrators acting on behalf of employers; and Carrier, which derives substantially all of its revenue from insurance companies that provide coverage at their own risk. Segments are evaluated based on gross profit. The Company does not allocate interest income, interest expense or income tax expense by segment. Accordingly, the Company does not report such information. Additionally, Employer and Carrier segments share the majority of the Company’s assets. Therefore, no segment asset information is reported. Substantially all assets were held and all revenue was generated in the United States during the three months ended June 30, 2015 and 2014. Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Revenue from external customers by segment: Employer $ 20,779 $ 14,289 $ 41,677 $ 27,566 Carrier 21,929 18,048 43,700 35,467 Total net revenue from external customers $ 42,708 $ 32,337 $ 85,377 $ 63,033 Depreciation and amortization by segment: Employer $ 1,450 $ 1,112 $ 2,792 $ 2,146 Carrier 1,453 1,444 2,934 2,854 Total depreciation and amortization $ 2,903 $ 2,556 $ 5,726 $ 5,000 Gross profit by segment: Employer $ 7,571 $ 3,586 $ 16,125 $ 8,193 Carrier 11,497 7,714 23,149 14,577 Total gross profit $ 19,068 $ 11,300 $ 39,274 $ 22,770

Related Parties

Related Parties	6 Months Ended
	Jun. 30, 2015
Related Parties	13. Related Parties Related Party Leasing Arrangements The Company leases the buildings and office space on its Charleston, South Carolina campus from entities with which two of the Company’s directors, significant stockholders, and executives are affiliated. The leasing arrangements have 15-year terms which started in 2006, 2009, and 2015. The Company has an option to renew the 2006 and 2009 arrangements for one five-year period and an option to renew the 2015 arrangement for up to five one-year periods. The arrangements provide for 3.0% fixed annual rent increases. Payments under these agreements were $2,220 and $1,092 for the three months ended June 30, 2015 and 2014, respectively and $7,172 and $2,451 for the six months ended June 30, 2015 and 2014, respectively. Amounts due to the related parties were $799 and $1,807 as of June 30, 2015 and December 31, 2014, respectively. As of June 30, 2015, $119 of amounts due to the related parties were recorded as “Accounts payable” and $680 were recorded as “Accrued expenses”. As of December 31, 2014, $949 was recorded in “Accounts payable” and $858 was recorded in “Accrued expenses”. Related Party Travel Expenses The Company utilizes the services of a private air transportation company that is owned and controlled by a Company director, significant stockholder, and executive. Expenses related to this company were $28 and $110 for the three months ended June 30, 2015 and 2014, respectively and $82 and $203 for the six months ended June 30, 2015 and 2014, respectively. Amounts due to this related party were $0 and $44 as of June 30, 2015 and December 31, 2014, respectively, and were recorded in “Accrued expenses.” Related Party Revenues As disclosed in Note 10, the Company entered into a Stock Purchase Agreement with Mercer, a customer, on February 24, 2015. As a result of this transaction, Mercer became a related party by virtue of beneficially owning more than 10% of the voting interest of the Company. At the same time, the Company entered into an amendment of its commercial contract with Mercer. The amendment to the commercial contract, among other things, expands certain terms and conditions of the existing relationship between the Company and Mercer and its affiliates. Revenue from Mercer was $3,501 for the three months ended June 30, 2015, and $4,615 for the six months ended June 30, 2015, from the time they became a related party, and was reflected in “Revenues,” within the accompanying statement of operations. The amounts due from Mercer were $1,603 as of June 30, 2015. The amount of deferred revenue associated with Mercer was $9,882 as of June 30, 2015 and was reflected in the balances of deferred revenue in the consolidated balance sheets.

Subsequent Events

Subsequent Events	6 Months Ended
	Jun. 30, 2015
Subsequent Events	14. Subsequent Events Restricted Stock Units During July 2015, the Company granted 35,627 restricted stock units to employees and certain directors with an aggregate grant date fair value of $1,460. Generally, these restricted stock units vest in equal annual installments over 4 years from the grant date. The Company amortizes the fair value of the stock subject to the restricted stock units at the time of grant on a straight-line basis over the period of vesting. The Company recognizes the income tax benefits resulting from vesting of restricted stock units in the period they vest, to the extent the compensation expense has been recognized.

Summary of Significant Accoun21

Summary of Significant Accounting Policies (Policies)	6 Months Ended
	Jun. 30, 2015
Principles of Consolidation	Principles of Consolidation These unaudited consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”). The unaudited consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. The Company is not the primary beneficiary of, nor does it have a controlling financial interest in, any variable interest entity. Accordingly, the Company has not consolidated any variable interest entity.
Interim Unaudited Consolidated Financial Information	Interim Unaudited Consolidated Financial Information The accompanying unaudited consolidated financial statements and footnotes have been prepared in accordance with GAAP as contained in the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (the “Codification” or “ASC”) for interim financial information, and with Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, the interim financial information includes all adjustments of a normal recurring nature necessary for a fair presentation of the results of operations, financial position, changes in stockholders’ equity and cash flows. The results of operations for the three- and six-month periods ended June 30, 2015 are not necessarily indicative of the results for the full year or the results for any other future period. These unaudited consolidated financial statements should be read in conjunction with the audited financial statements and related footnotes for the year ended December 31, 2014 included in the Company’s Annual Report on Form 10-K filed with the United States Securities and Exchange Commission on February 27, 2015.
Use of Estimates	Use of Estimates The preparation of financial statements in conformity with GAAP requires the Company to make estimates and assumptions that affect the reported amounts in the consolidated financial statements and accompanying notes. Such estimates include revenue recognition and the customer relationship period, allowances for doubtful accounts and returns, valuations of deferred income taxes, long-lived assets and warrants, the useful lives of assets, capitalizable software development costs and the related amortization, contingent consideration, stock-based compensation, annual bonus attainment, and the recognition and impairment of acquired intangibles and goodwill. Determination of these transactions and account balances are based on the Company’s estimates and judgments. These estimates are based on the Company’s knowledge of current events and actions it might undertake in the future as well as on various other assumptions that it believes to be reasonable. Actual results could differ from these estimates.
Revenue and Deferred Revenue	Revenue and Deferred Revenue The Company derives the majority of its revenue from software services fees, which consist primarily of monthly subscription fees paid by customers for access to and usage of the Company’s cloud-based benefits software solutions for a specified contract term. The Company also derives revenue from professional services which primarily include fees related to the integration of customers’ systems with the Company’s platform, which typically includes discovery, configuration, deployment, testing, and training. The Company recognizes revenue when there is persuasive evidence of an arrangement, the service has been provided, the fees to be paid by the customer are fixed and determinable and collectability is reasonably assured. The Company considers delivery of its cloud-based software services has commenced once it has granted the customer access to its platform. The Company’s arrangements generally contain multiple elements comprised of software services and professional services. The Company evaluates each element in an arrangement to determine whether it represents a separate unit of accounting. An element constitutes a separate unit of accounting when the delivered item has standalone value and delivery of the undelivered element is probable and within the Company’s control. The Company’s professional services are not sold separately from the software services and there is no alternative use for them. As such, the Company has determined that the professional services do not have standalone value. Accordingly, software services and professional services are combined and recognized as a single unit of accounting. The Company generally recognizes software services fees monthly based on the number of employees covered by the relevant benefits plans at contracted rates for a specified period of time, once the criteria for revenue recognition described above have been satisfied. The Company defers recognition of revenue for professional services fees and begins recognizing such revenue once the services are performed and the related software services have commenced, ratably over the longer of the contract term or the estimated expected life of the customer relationship. Costs incurred by the Company in connection with providing such professional services are charged to expense as incurred and are included in “Cost of revenue.” In January 2015, the Company adjusted the estimated expected life of its customer relationship. This change in estimate was the result of analyzing quantitative and qualitative observations in the market and the Company’s business. This change shortened the term over which deferred revenue is recognized from 10 to 7 years and was applied prospectively to unamortized professional services fees over the longer of the contract term or the adjusted estimated expected life of the customer relationship. The change in the customer relationship period increased the amount of revenue recognized during the three and six months ended June 30, 2015, which decreased loss from continuing operations and net loss by $1,499 and $3,199, respectively, and decreased our loss per share by $0.05 and $0.12 for the three- and six-month periods ended June 30, 2015, respectively. As a result of the change in the customer relationship period, Carrier and Employer revenue increased by $1,198 and $301, respectively, for the three months ended June 30, 2015, and $2,646 and $553, respectively, for the six months ended June 30, 2015. As of July 1, 2015, the Company determined that it had established standalone value for the implementation services for the Benefitfocus Marketplace solution in the Employer segment. This was primarily due to the system integrators that have been trained and certified to perform these implementation services, the successful completion of an implementation by a trained system integrator, and the sale of several software subscription arrangements to customers in the Employer segment without the Company’s implementation services. Accordingly, implementation services related to the Benefitfocus Marketplace solution in the Employer segment that are delivered after July 1, 2015 will be recognized separately from the revenues earned from the Employer software subscription services.
Concentrations of Credit Risk	Concentrations of Credit Risk The Company’s financial instruments that are exposed to concentrations of credit risk consist primarily of cash equivalents, marketable securities and accounts receivable. All of the Company’s cash and cash equivalents are held at financial institutions that management believes to be of high credit quality. The bank deposits of the Company might, at times, exceed federally insured limits and are generally uninsured and uncollateralized. The Company has not experienced any losses on cash and cash equivalents to date. To manage credit risk related to marketable securities, the Company invests in various types of highly rated corporate bonds, commercial paper, and various United States backed securities with maturities of less than two years. The weighted average maturity of the portfolio of investments must not exceed nine months, per the Company’s investment policy. To manage accounts receivable risk, the Company evaluates the creditworthiness of its customers and maintains an allowance for doubtful accounts. Accounts receivable were unsecured and were derived from revenue earned from customers located in the United States. Accounts receivable from one customer, Aetna, represented 10.0% and 13.3%, of the total accounts receivable at June 30, 2015 and December 31, 2014, respectively. One customer, Aetna, represented 10.0% of total revenue for the three- and six-month periods ended June 30, 2015. No customer represented more than 10% of total revenue for the three- and six-month periods ended June 30, 2014.
Accounts Receivable and Allowance for Doubtful Accounts and Returns	Accounts Receivable and Allowance for Doubtful Accounts and Returns Accounts receivable is stated at realizable value, net of allowances for doubtful accounts and returns. The Company utilizes the allowance method to provide for doubtful accounts based on management’s evaluation of the collectability of amounts due and other relevant factors. Bad debt expense is recorded in general and administrative expense on the unaudited consolidated statements of operations and comprehensive loss. The Company’s estimate is based on historical collection experience and a review of the current status of accounts receivable. Historically, actual write-offs for uncollectible accounts have not significantly differed from the Company’s estimates. The Company removes recorded receivables and the associated allowances when they are deemed permanently uncollectible. However, higher than expected bad debts could result in write-offs that are greater than the Company’s estimates. The allowance for doubtful accounts was $10 as of both June 30, 2015 and December 31, 2014. The allowances for returns are accounted for as reductions of revenue and are estimated based on the Company’s periodic assessment of historical experience and trends. The Company considers factors such as the time lag since the initiation of revenue recognition, historical reasons for adjustments, new customer volume, complexity of billing arrangements, timing of software availability, and past due customer billings. The allowance for returns was $1,646 and $1,653 as of June 30, 2015 and December 31, 2014, respectively.
Capitalized Software Development Costs	Capitalized Software Development Costs The Company capitalizes certain costs related to its software developed or obtained for internal use. Costs related to preliminary project activities and post-implementation activities are expensed as incurred. Internal and external costs incurred during the application development stage, including upgrades and enhancements representing modifications that will result in significant additional functionality, are capitalized. Software maintenance and training costs are expensed as incurred. Capitalized costs are recorded as part of property and equipment and are amortized on a straight-line basis over the software’s estimated useful life which is three years. The Company evaluates these assets for impairment whenever events or changes in circumstances occur that could impact the recoverability of these assets. In the three months ended June 30, 2015 and 2014, the Company capitalized software development costs of $506 and $503, and amortized capitalized software development costs of $671 and $768, respectively. In the six months ended June 30, 2015 and 2014, the Company capitalized software development costs of $1,051 and $938, and amortized capitalized software development costs of $1,347 and $1,463, respectively. The net book value of capitalized software development costs was $3,838 and $4,134 at June 30, 2015 and December 31, 2014, respectively.
Comprehensive Loss	Comprehensive Loss The Company’s net loss equals comprehensive loss for all periods presented.
Accounting Standards Not Yet Adopted	Accounting Standards Not Yet Adopted In May 2014, the FASB issued ASU No. 2014-09 “Revenue from Contracts with Customers”, which amends the revenue recognition requirements in the FASB Accounting Standards Codification (ASC). This statement requires that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The statement shall be applied using one of two methods: retrospectively to each prior reporting period presented, or retrospectively with the cumulative effect of initially applying this statement recognized at the date of initial application. The Company has not yet determined which method it will apply. In July 2015, FASB approved the deferral of the effective date of this guidance by one year. As a result, this guidance will be effective for the Company beginning January 1, 2018, with an option to early adopt. The Company is currently evaluating the impact of this guidance on the Company’s consolidated financial position and results of operations. In April 2015, the FASB issued ASU No. 2015-03, “Interest—Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs.” The amendments in this ASU require that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. This guidance is effective for annual and interim reporting periods of public entities beginning after December 15, 2015, and early adoption is permitted. The Company is currently evaluating the impact of this statement on its consolidated financial position.

Net Loss Per Common Share (Tabl

Net Loss Per Common Share (Tables)	6 Months Ended
	Jun. 30, 2015
Common Share Equivalent Securities Excluded from Calculation of Weighted-Average Common Shares Outstanding	The following common share equivalent securities have been excluded from the calculation of weighted average common shares outstanding because the effect is anti-dilutive for the periods presented: Three Months Ended June 30, Six Months Ended June 30, Anti-Dilutive Common Share Equivalents 2015 2014 2015 2014 Restricted stock units 998,889 369,707 998,889 369,707 Stock options 2,134,685 2,563,379 2,134,685 2,563,379 Warrant to purchase common stock 580,813 — 580,813 — Total anti-dilutive common share equivalents 3,714,387 2,933,086 3,714,387 2,933,086
Basic and Diluted Net Loss per Common Share	Basic and diluted net loss per common share is calculated as follows: Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Numerator: Net loss $ (18,284 ) $ (18,200 ) $ (32,933 ) $ (30,602 ) Net loss attributable to common stockholders $ (18,284 ) $ (18,200 ) $ (32,933 ) $ (30,602 ) Denominator: Weighted-average common shares outstanding, basic and diluted 28,633,992 25,200,093 27,694,935 24,872,545 Net loss per common share, basic and diluted $ (0.64 ) $ (0.72 ) $ (1.19 ) $ (1.23 )

Fair Value Measurement (Tables)

Fair Value Measurement (Tables)	6 Months Ended
	Jun. 30, 2015
Assets and Liabilities Measured at Fair Value on Recurring Basis	The following tables present information about the Company’s assets and liabilities that are measured at fair value on a recurring basis using the above categories, as of June 30, 2015 and December 31, 2014. June 30, 2015 Description Level 1 Level 2 Level 3 Total Cash Equivalents: Money market mutual funds (1) $ 39,038 $ — $ — $ 39,038 Total assets $ 39,038 $ — $ — $ 39,038 December 31, 2014 Description Level 1 Level 2 Level 3 Total Cash Equivalents: Money market mutual funds (1) $ 50,695 $ — $ — $ 50,695 Total assets $ 50,695 $ — $ — $ 50,695 (1) Money market funds are classified as cash equivalents in the Company’s unaudited consolidated balance sheets. As short-term, highly liquid investments readily convertible to known amounts of cash, with remaining maturities of three months or less at the time of purchase, the Company’s cash equivalent money market funds have carrying values that approximate fair value.

Marketable Securities (Tables)

Marketable Securities (Tables)	6 Months Ended
	Jun. 30, 2015
Investments In Unrealized Loss Position For Which Other-Than-Temporary Impairment not Recognized in Earnings	The following table presents information about the Company’s investments that were in an unrealized loss position and for which an other-than-temporary impairment has not been recognized in earnings as of: June 30, 2015 December 31, 2014 Aggregate fair value of investments with unrealized losses (1) $ 28,902 $ 5,135 Aggregate amount of unrealized losses (33 ) (1 ) (1) Investments have been in a continuous loss position for less than 12 months

Property and Equipment (Tables)

Property and Equipment (Tables)	6 Months Ended
	Jun. 30, 2015
Property and Equipment	Property and equipment consists of the following as of: June 30, 2015 December 31, 2014 Buildings, leased $ 26,444 $ 7,965 Computers and related equipment 21,039 18,871 Purchased software and licenses 21,288 20,392 Software developed 19,448 18,397 Furniture and fixtures 6,510 3,834 Leasehold improvements 6,764 3,334 Other equipment 3,044 2,009 Vehicles 111 111 Construction in progress 118 24,296 Total property and equipment, at cost 104,766 99,209 Accumulated depreciation and amortization (50,706 ) (45,188 ) Property and equipment, net $ 54,060 $ 54,021

Stockholders' Equity (Deficit)

Stockholders' Equity (Deficit) (Tables)	6 Months Ended
	Jun. 30, 2015
Shares of Common Stock Reserved for Future Issuance	At June 30, 2015, the Company had reserved a total of 5,330,056 of its authorized 50,000,000 shares of common stock for future issuance as follows: Outstanding stock options 2,134,685 Restricted stock units 998,889 Possible future issuance under stock option plans 1,615,669 Warrant to purchase common stock 580,813 Total common shares reserved for future issuance 5,330,056

Segments and Geographic Infor27

Segments and Geographic Information (Tables)	6 Months Ended
	Jun. 30, 2015
Segments and Geographic Information	Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Revenue from external customers by segment: Employer $ 20,779 $ 14,289 $ 41,677 $ 27,566 Carrier 21,929 18,048 43,700 35,467 Total net revenue from external customers $ 42,708 $ 32,337 $ 85,377 $ 63,033 Depreciation and amortization by segment: Employer $ 1,450 $ 1,112 $ 2,792 $ 2,146 Carrier 1,453 1,444 2,934 2,854 Total depreciation and amortization $ 2,903 $ 2,556 $ 5,726 $ 5,000 Gross profit by segment: Employer $ 7,571 $ 3,586 $ 16,125 $ 8,193 Carrier 11,497 7,714 23,149 14,577 Total gross profit $ 19,068 $ 11,300 $ 39,274 $ 22,770

Summary of Significant Accoun28

Summary of Significant Accounting Policies - Additional Information (Detail) $ / shares in Units, $ in Thousands	1 Months Ended	3 Months Ended		6 Months Ended		12 Months Ended
	Jan. 31, 2015	Jun. 30, 2015USD ($)$ / shares	Jun. 30, 2014USD ($)Customer$ / shares	Jun. 30, 2015USD ($)$ / shares	Jun. 30, 2014USD ($)Customer$ / shares	Dec. 31, 2014USD ($)
Summary of Significant Accounting Policies [Line Items]
Loss before income taxes		$ (18,279)	$ (18,185)	$ (32,913)	$ (30,573)
Net loss		$ (18,284)	$ (18,200)	$ (32,933)	$ (30,602)
Loss per share | $ / shares		$ (0.64)	$ (0.72)	$ (1.19)	$ (1.23)
Revenue		$ 42,708	$ 32,337	$ 85,377	$ 63,033
Number of customers exceeded 10% of total revenue | Customer			0		0
Allowance for doubtful accounts		10		10		$ 10
Capitalized software cost gross		506	$ 503	1,051	$ 938
Amortization of capitalized software cost		671	$ 768	1,347	$ 1,463
Capitalized software cost net		$ 3,838		$ 3,838		$ 4,134
Customer Concentration Risk | Accounts Receivable | Aetna
Summary of Significant Accounting Policies [Line Items]
Concentration risk, percentage				10.00%		13.30%
Customer Concentration Risk | Total Revenue | Aetna
Summary of Significant Accounting Policies [Line Items]
Concentration risk, percentage		10.00%		10.00%
Capitalized Software Development Costs
Summary of Significant Accounting Policies [Line Items]
Useful lives for property and equipment				3 years
Change in Customer Relationship Period
Summary of Significant Accounting Policies [Line Items]
Loss before income taxes		$ (1,499)		$ (3,199)
Net loss		$ (1,499)		$ (3,199)
Loss per share | $ / shares		$ (0.05)		$ (0.12)
Change in Customer Relationship Period | Carrier
Summary of Significant Accounting Policies [Line Items]
Revenue		$ 1,198		$ 2,646
Change in Customer Relationship Period | Employer
Summary of Significant Accounting Policies [Line Items]
Revenue		301		$ 553
Maximum
Summary of Significant Accounting Policies [Line Items]
Marketable securities, investment maturity period				2 years
Weighted average maturity of portfolio investments				9 months
Maximum | Customer Agreements
Summary of Significant Accounting Policies [Line Items]
Deferred revenue recognition period	10 years
Minimum | Customer Agreements
Summary of Significant Accounting Policies [Line Items]
Deferred revenue recognition period	7 years
Allowance for Returns
Summary of Significant Accounting Policies [Line Items]
Allowance for returns		$ 1,646		$ 1,646		$ 1,653

Common Share Equivalents Securi

Common Share Equivalents Securities Excluded From Calculation of Weighted Average Common Share Outstanding (Detail) - shares	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive common share equivalents	3,714,387	2,933,086	3,714,387	2,933,086
Restricted Stock Units (RSUs)
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive common share equivalents	998,889	369,707	998,889	369,707
Stock Options
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive common share equivalents	2,134,685	2,563,379	2,134,685	2,563,379
Warrant to Purchase Common Stock
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive common share equivalents	580,813		580,813

Basic and Diluted Net Loss per

Basic and Diluted Net Loss per Common Share (Detail) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Numerator:
Net loss	$ (18,284)	$ (18,200)	$ (32,933)	$ (30,602)
Net loss attributable to common stockholders	$ (18,284)	$ (18,200)	$ (32,933)	$ (30,602)
Denominator:
Weighted-average common shares outstanding, basic and diluted	28,633,992	25,200,093	27,694,935	24,872,545
Net loss per common share, basic and diluted	$ (0.64)	$ (0.72)	$ (1.19)	$ (1.23)

Assets and Liabilities Measured

Assets and Liabilities Measured at Fair Value on a Recurring Basis (Detail) - USD ($) $ in Thousands		Jun. 30, 2015	Dec. 31, 2014
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets		$ 39,038	$ 50,695
Money market mutual funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash Equivalents	[1]	39,038	50,695
Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Total assets		39,038	50,695
Level 1 | Money market mutual funds
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Cash Equivalents	[1]	$ 39,038	$ 50,695
[1]	Money market funds are classified as cash equivalents in the Company's unaudited consolidated balance sheets. As short-term, highly liquid investments readily convertible to known amounts of cash, with remaining maturities of three months or less at the time of purchase, the Company's cash equivalent money market funds have carrying values that approximate fair value.

Marketable Securities - Additio

Marketable Securities - Additional Information (Detail) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2015	Dec. 31, 2014
Gain (Loss) on Investments [Line Items]
Held-to-maturity securities, amortized cost basis	$ 48,091	$ 5,135
Held-to-maturity securities, net carrying amount	48,091	5,135
Held-to-maturity securities, fair value	48,063	5,134
Held-to-maturity securities, gross unrealized holding gains	5	0
Held-to-maturity securities, gross unrealized holding losses	$ 33	$ 1
Minimum
Gain (Loss) on Investments [Line Items]
Held-to-maturity securities, contractual maturity period	1 month
Maximum
Gain (Loss) on Investments [Line Items]
Held-to-maturity securities, contractual maturity period	10 months

Unrealized Loss Position of Inv

Unrealized Loss Position of Investments Other-Than-Temporary Impairment not Recognized in Earnings (Detail) - USD ($) $ in Thousands		6 Months Ended	12 Months Ended
		Jun. 30, 2015	Dec. 31, 2014
Gain (Loss) on Investments [Line Items]
Aggregate fair value of investments with unrealized losses	[1]	$ 28,902	$ 5,135
Aggregate amount of unrealized losses		$ (33)	$ (1)
[1]	Investments have been in a continuous loss position for less than 12 months

Property and Equipment (Detail)

Property and Equipment (Detail) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 104,766	$ 99,209
Accumulated depreciation and amortization	(50,706)	(45,188)
Property and equipment, net	54,060	54,021
Buildings
Property, Plant and Equipment [Line Items]
Property and equipment, gross	26,444	7,965
Computers and Related Equipment
Property, Plant and Equipment [Line Items]
Property and equipment, gross	21,039	18,871
Purchased Software and Licenses
Property, Plant and Equipment [Line Items]
Property and equipment, gross	21,288	20,392
Software Developed
Property, Plant and Equipment [Line Items]
Property and equipment, gross	19,448	18,397
Furniture and Fixtures
Property, Plant and Equipment [Line Items]
Property and equipment, gross	6,510	3,834
Leasehold Improvements
Property, Plant and Equipment [Line Items]
Property and equipment, gross	6,764	3,334
Other Equipment
Property, Plant and Equipment [Line Items]
Property and equipment, gross	3,044	2,009
Vehicles
Property, Plant and Equipment [Line Items]
Property and equipment, gross	111	111
Construction in progress, build-to-suit
Property, Plant and Equipment [Line Items]
Property and equipment, gross	$ 118	$ 24,296

Revolving Line of Credit and 35

Revolving Line of Credit and Senior Revolving Line of Credit - Additional Information (Detail) - USD ($)	Feb. 20, 2015	Apr. 30, 2015	Mar. 31, 2015	Feb. 28, 2015	Jun. 30, 2015	Jun. 30, 2014
Line of Credit Facility [Line Items]
Proceeds from line of credit borrowing					$ 22,492,000	$ 7,000,000
Payments on revolving line of credit					34,903,000
Amount outstanding under credit facility					5,246,000
Amount available to borrow under line of credit					$ 45,291,000
Hardware And Software
Line of Credit Facility [Line Items]
Proceeds from line of credit borrowing			$ 4,246,000
Payments on revolving line of credit		$ 4,000,000		$ 13,246,000
Senior Revolving Line of Credit
Line of Credit Facility [Line Items]
Proceeds from line of credit borrowing	$ 18,246,000
Administrative and legal fees related to the issuance of line of credit	589,000
Revolving Line of Credit
Line of Credit Facility [Line Items]
Payments on revolving line of credit	$ 17,657,000
Line of credit facility, expiration period				3 years
Line of credit facility maximum borrowing capacity				$ 60,000,000
Revolving Line of Credit | Maximum
Line of Credit Facility [Line Items]
Amount under revolving line of credit available to company				$ 60,000,000
Liquidity percentage				1.50%
Line of credit facility, unused capacity, commitment fee percentage				0.375%
Revolving Line of Credit | Minimum
Line of Credit Facility [Line Items]
Liquidity percentage				1.00%
Line of credit facility, unused capacity, commitment fee percentage				0.30%

Commitments and Contingencies -

Commitments and Contingencies - Additional Information (Detail) - Build-to-suit Lease - USD ($) $ in Thousands	1 Months Ended
	Jan. 31, 2015	Jun. 30, 2015
Commitments and Contingencies Disclosure [Line Items]
Capital lease agreement period	15 years
Property Plant And Equipment Net
Commitments and Contingencies Disclosure [Line Items]
Financing obligation		$ 21,200

Stock-Based Compensation - Addi

Stock-Based Compensation - Additional Information (Detail) - Restricted Stock Units (RSUs) - USD ($) $ in Thousands	1 Months Ended
	Apr. 30, 2015	Jan. 31, 2015
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Restricted stock units, granted	401,043	26,050
Restricted stock units, aggregate grant date fair value	$ 14,377	$ 815
Vesting period of restricted stock awards	4 years	4 years

Stockholders' Equity (Deficit38

Stockholders' Equity (Deficit) - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Thousands	Feb. 24, 2015	Jun. 30, 2015	Dec. 31, 2014
Schedule Of Stockholders Equity [Line Items]
Common stock , authorized shares reserved for future issuance		5,330,056
Common stock , shares authorized		50,000,000	50,000,000
Proceeds from issuance of common stock and warrant, net of issuance costs		$ 74,538
Mercer LLC
Schedule Of Stockholders Equity [Line Items]
Stock issued, shares	2,817,526
Stock issued, price per share	$ 26.50
Stock issued, value	$ 74,664
Warrant term	30 months
Maximum number of shares to be issued under warrant agreement	580,813
Warrant exercise price per share	$ 26.50
Proceeds from issuance of common stock and warrant, net of issuance costs		$ 74,331
Mercer LLC | Maximum
Schedule Of Stockholders Equity [Line Items]
Common stock ownership percentage in Mercer Health & Benefits, LLC	75.00%
Outstanding common stock ownership percentage	5.00%

Common Stock for Future Issuanc

Common Stock for Future Issuance (Detail)	Jun. 30, 2015shares
Common Stock [Line Items]
Outstanding stock options	2,134,685
Restricted stock units	998,889
Possible future issuance under stock option plans	1,615,669
Warrant to purchase common stock	580,813
Total common shares reserved for future issuance	5,330,056

Income Taxes - Additional Infor

Income Taxes - Additional Information (Detail) - Jun. 30, 2015	Total	Total
Maximum
Income Taxes [Line Items]
Effective federal tax rate	(1.00%)	(1.00%)

Segment and Geographic Informat

Segment and Geographic Information (Detail) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Segment Reporting Information [Line Items]
Net revenue from external customers	$ 42,708	$ 32,337	$ 85,377	$ 63,033
Depreciation and amortization	2,903	2,556	5,726	5,000
Gross profit	19,068	11,300	39,274	22,770
Employer
Segment Reporting Information [Line Items]
Net revenue from external customers	20,779	14,289	41,677	27,566
Depreciation and amortization	1,450	1,112	2,792	2,146
Gross profit	7,571	3,586	16,125	8,193
Carrier
Segment Reporting Information [Line Items]
Net revenue from external customers	21,929	18,048	43,700	35,467
Depreciation and amortization	1,453	1,444	2,934	2,854
Gross profit	$ 11,497	$ 7,714	$ 23,149	$ 14,577

Related Parties - Additional In

Related Parties - Additional Information (Detail) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015USD ($)	Jun. 30, 2014USD ($)	Jun. 30, 2015USD ($)Option	Jun. 30, 2014USD ($)	Dec. 31, 2014USD ($)
Related Party Transaction [Line Items]
Lease agreement period			15 years
Percentage of fixed annual rent increases			3.00%
Lease operating expenses	$ 2,220	$ 1,092	$ 7,172	$ 2,451
Due to related party	799		799		$ 1,807
Transportation service from related party	28	$ 110	82	$ 203
Due to related party, current	0		0		44
Mercer
Related Party Transaction [Line Items]
Revenue from related parties	3,501		4,615
Due from related parties	1,603		1,603
Deferred revenue	$ 9,882		$ 9,882
Mercer | Minimum
Related Party Transaction [Line Items]
Outstanding common stock ownership percentage	10.00%		10.00%
Accounts Payable
Related Party Transaction [Line Items]
Due to related party	$ 119		$ 119		949
Accrued Expenses
Related Party Transaction [Line Items]
Due to related party	$ 680		$ 680		$ 858
2006 and 2009 Arrangements
Related Party Transaction [Line Items]
Lease renewal option, number of renewal options | Option			1
Lease renewal option term			5 years
2015 Arrangement
Related Party Transaction [Line Items]
Lease renewal option, number of renewal options | Option			5
Lease renewal option term			1 year

Subsequent Events - Additional

Subsequent Events - Additional Information (Detail) - Restricted Stock Units (RSUs) - USD ($) $ in Thousands	1 Months Ended
	Jul. 31, 2015	Apr. 30, 2015	Jan. 31, 2015
Subsequent Event [Line Items]
Restricted stock units, granted		401,043	26,050
Restricted stock units, aggregate grant date fair value		$ 14,377	$ 815
Vesting period of restricted stock awards		4 years	4 years
Subsequent Event
Subsequent Event [Line Items]
Restricted stock units, granted	35,627
Restricted stock units, aggregate grant date fair value	$ 1,460
Vesting period of restricted stock awards	4 years