NASDAQ:GOCO GoHealth Q2 2024 Earnings Report $10.27 0.00 (0.00%) As of 10:27 AM Eastern This is a fair market value price provided by Polygon.io. Learn more. Earnings HistoryForecast GoHealth EPS ResultsActual EPS-$0.75Consensus EPS -$2.47Beat/MissBeat by +$1.72One Year Ago EPSN/AGoHealth Revenue ResultsActual Revenue$105.87 millionExpected Revenue$138.99 millionBeat/MissMissed by -$33.12 millionYoY Revenue GrowthN/AGoHealth Announcement DetailsQuarterQ2 2024Date8/8/2024TimeN/AConference Call DateThursday, August 8, 2024Conference Call Time8:00AM ETUpcoming EarningsGoHealth's Q1 2025 earnings is scheduled for Thursday, May 8, 2025, with a conference call scheduled at 8:00 AM ET. Check back for transcripts, audio, and key financial metrics as they become available.Q1 2025 Earnings ReportConference Call ResourcesConference Call AudioConference Call TranscriptSlide DeckPress Release (8-K)Quarterly Report (10-Q)Earnings HistoryCompany ProfileSlide DeckFull Screen Slide DeckPowered by GoHealth Q2 2024 Earnings Call TranscriptProvided by QuartrAugust 8, 2024 ShareLink copied to clipboard.There are 8 speakers on the call. Operator00:00:00Good morning, and welcome to GoHealth Second Quarter 20 24 Earnings Conference Call. My name is Marvin, and I'll be your operator for today's call. Currently, all participants are in a listen only mode. Following the prepared remarks, we will conduct a question and answer session. As a reminder, this conference is being recorded. Operator00:00:18I'll now turn the call over to John Shea, Vice President of Investor Relations. John, you may begin. Speaker 100:00:26Thank you, and good morning. Welcome to GoHealth's Q2 2024 earnings call. Joining me today are Vijay Cote, Chief Executive Officer and Katie O'Halloran, Interim Chief Financial Officer. Today's conference call contains forward looking statements based on our current expectations. Numerous known and unknown risks and uncertainties may cause actual results to differ materially from those anticipated or projected in these statements. Speaker 100:00:53Many of the factors that will determine future results are beyond the company's ability to control or predict. You should not place undue reliance on any forward looking statements and the company undertakes no obligation to update or revise any of these statements whether due to new information, future events or otherwise. Earlier today, we issued a press release containing our results for the Q2 of 2024. We have posted the release on the GoHealth website under the Investor Relations tab. In conjunction with our forward looking statements, we encourage you to consider the other risk factors described in our 2023 Annual Report on Form 10 ks and our other filings with the SEC for additional information. Speaker 100:01:35During this call, we will be discussing certain non GAAP financial measures. These measures are reconciled to the most directly comparable GAAP financial measure and the reconciliations are set forth in the press release. I will now turn the call over to GoHealth's CEO, Vijay Cote. Speaker 200:01:50Thank you, John, and good morning, everyone. I'd like to begin by sharing commentary on our quarterly performance along with updates on our general business activities and initiatives. In the Q2 of 2024, our internal captive team empowered nearly 525 1,000 consumers to navigate their Medicare options utilizing the PlanFit checkup via our proprietary encompass workflow. Along with supporting over 155,000 new enrollments in Q2, we also provide a peace of mind to over 125,000 consumers confirming their current plan is best for their needs. Our performance during Q2's special enrollment period or SVP exceeded our expectations for submissions, revenue and adjusted EBITDA. Speaker 200:02:35While our total submissions were down 6%, submissions generated by our internal captive agents increased 14% year over year versus a 33% decline in submissions from our external Go partner solutions or GPS agents. We are particularly pleased with our internal captive results, especially considering the shopping and switching dynamics have remained unchanged since the last annual enrollment period or AEP and are not expected to change significantly until Q4 of this year when health plans release new benefits. Due to market dynamics, we anticipated year over year declines from Q1 through Q3. Our team has managed these expected factors by driving efficiencies and reducing costs. We believe these results show the benefit of our proprietary Encompass workflow and plan fit checkout process. Speaker 200:03:24At GoHealth, our mission is to provide support and clarity to Medicare consumers in a landscape often marked by confusion and uncertainty. There are over 65,000,000 Medicare eligible individuals in the United States and approximately half of them are enrolled in Medicare Advantage Plans. 1 third of Medicare consumers live in counties with more than 50 plans available. The abundance of options can be overwhelming. This complexity often deters consumers from shopping for better options because they are unsure of who to trust or where to begin. Speaker 200:03:57We believe GoHealth is the premier resource to empower these individuals to make informed and personal decisions because of our proprietary and objective tools as well as our well trained tenured agent workforce. We are continuing our evolution from a traditional Medicare enrollment company to a Medicare engagement company, focusing on building high quality long term relationships with our consumers. We believe this shift emphasizes a more integrated and interactive approach to consumer care, cementing our unique and vital role in the Medicare landscape. On our last two quarterly calls, we highlighted several market factors that could influence our performance this year. Due to the dynamics of the industry, we expect clarity on the impact of these factors in Q4 once AEP starts. Speaker 200:04:43As typical, the market dynamics we observe in the Q4 of 2024 for AEP will continue for a full 4 quarters running through the Q3 of 2025. As a reminder, there are 5 key market factors. 1, the final rate notice on commissions for the 2025 plan year 2, the final 2025 marketing rule from the Centers for Medicare Medicaid Services or CMS 3, planned product and benefit differentiation between 2024 2025 4, marketing efficiency within this election season and finally, relative health plan competitiveness and its effect on plan mix. As we become more selective in the health plans we include in our marketplace, this factor impacts sales per submission or revenue per sale and agency versus non agency revenue distribution. As we report our Q2 results, we have updates regarding these factors. Speaker 200:05:44On Market Factor 1, as we previously discussed, CMS issued the final rate notice, which aligns with our expectations for the base commission schedule. The 2025 final rate notice introduced margin pressure for health plans, which we believe will likely lead to benefit disruptions and market exits, particularly for non special needs plans. Major health plans confirm significant upcoming benefit disruptions in their Q1 earnings calls. Similarly, we expect on average 20% plus increases in premiums for beneficiaries currently on Medicare Supplements. We believe these rate increases and disruptions could lead to a significant increase in consumer shopping and switching during the upcoming AEP, presenting a positive opportunity for GoHealth's business model. Speaker 200:06:32More recently, many health plans had the opportunity to resubmit their bids due to a series of successful lawsuits on STAR scores. While this may change AP's competitive dynamics, we know that many health plans are targeting growth in specific markets and products. Notably, some are focusing on the special needs population, a segment that GoHealth is uniquely equipped to attract and serve. These strategies and priorities will vary by health plan and geography, but we believe we are ideally positioned to help health plans achieve targeted and measured growth. On market factor 2, in April, CMS published the final 2025 marketing rules, addressing independent agent and broker compensation and introducing new guidelines. Speaker 200:07:15However, the U. S. District Court in Texas stayed the effective date of the compensation provisions of the rule and later CMS acknowledged that because of the court's order, the status quo would be maintained through AEP. As we have already commented, we believe the final rule as published had minimal impact to our business model, but the court order and subsequent CMS guidance confirms that it is business as usual. The one part of the rule that we expect to be implemented as planned pertains to the restrictions in the new rules surrounding conduct commonly attributed to lead generators. Speaker 200:07:51Those restrictions should not affect GoHealth because we held ourselves to the standards of the new rule years before the rule was even proposed. And accordingly, we think these restrictions are good for the industry at large to protect consumers from confusing and unintended sales calls. As we contemplate the remaining factors, we are cautiously optimistic about shopping and appropriate switching during AEP. As part of our strategic shift from enrollment to engagement, we believe in building trusted relationships with consumers and putting them in the right plan for their needs. As a reminder, we have always indicated that we plan to have a portfolio of agency and non agency contracts varying by health plan and product, but mix would be dependent on the plans most suitable for the consumers we serve. Speaker 200:08:38Based on our early reads, though still to be refined based on actual benefit releases later this year, we see a mix shifting towards contracts with agency arrangements versus non agency arrangements. The evolving market dynamics are expected to result in tailwinds for submissions, revenue and adjusted EBITDA. However, we expect a year over year decline in cash flow from operations due to the shift from non agency revenue. We are committed to supporting the consumer throughout their Medicare journey and believe doing the right thing will ultimately increase engagement and retention. We look forward to providing an update during our November quarterly results call once AP dynamics start to play out. Speaker 200:09:16Additionally, there are 2 emerging market factors that I'd like to discuss. 1st, several midsized brokers have ceased operations due to evolving market dynamics and poor management of customer acquisition costs. We believe this will lead to less competition for leads and generally for the attention of Medicare consumers during AEP, a potential tailwind for GoHealth. In addition, the seasoned agents entering the market offer us the opportunity to pick up tenured new hires as we ramp for AEP. 2nd, GoHealth's external GPS agents have seen fewer submissions year over year through Q2. Speaker 200:09:52Dove Health partners with several smaller brokers as downlines who leverage our technology platform, health plan relationships and support teams to operate effectively. These brokers are also experiencing market pressures resulting in lower production. To offset their lower production, we are in the midst of onboarding several new agencies who we expect to meaningfully contribute to GPS submissions to this AEP. Now let me move from market factors to some exciting developments regarding our strategic investments. In the Q4 of 2023, we announced the launch of PlanFit Checkup. Speaker 200:10:25This innovative service powered by our proprietary AI driven PlanFit tool is designed to alleviate stress and enhances the experience for consumers shopping for a Medicare Advantage plan. As we have previously shared, plan fit checkup delivers 3 key consumer outcomes. 1, enrolling a consumer in a new plan that better suits their needs. 2, informing the consumer about a superior plan even if they choose not to switch. And 3, reassuring the consumer that their current plan remains the best option for their needs resulting in no enrollment change. Speaker 200:11:01Importantly, GoHealth agents are compensated for completing a plan fit checkup regardless of whether the assessment leads to a new enrollment. This ensures that our agents remain focused on providing the best advice and service to our consumers. Based on our launch results, we are well on our way to operationalizing reimbursement for a subset of these plan fit checkups in what we call a plan fit save with a select few strategic health plan partners. A plan fit save is a plan fit check up where our agents reassure the consumer that their current plan remains the best option for their needs, resulting in no enrollment change and we help the consumer understand and navigate the benefits of their current plan that are most valuable to them. Process, we earned compensation for doing the right thing for consumers as well as protecting the existing membership of our health plan partners. Speaker 200:11:52This year, we are focusing on streamlining processes and improving call handle times. As part of this effort, we launched Encompass Express, an enhanced consumer centric model built on the foundation of our original Encompass workflow. Encompass Express includes streamlined scripting and handoffs, utilizing tech driven standardization and automation to deliver efficiency and enhance the consumer experience while maintaining quality. Notably, we have reduced consumer on phone time by approximately 25% from 90 minutes to 67 minutes. We anticipate these changes will positively impact our financial results more substantively this fall during AAP. Speaker 200:12:32We are dedicated to advancing our technology to elevate the consumer experience, boost agent efficiency and enhance overall quality. Our strategic investments focused on several key areas. 1st, we are running programs integrating AI and automation into our operations. This initiative aims to streamline processes including agent onboarding, enhanced agent efficiency and deliver more precise data driven insights to improve the overall consumer experience. One great example of this is how we have deployed AI to support agent ramp. Speaker 200:13:05History has shown us that training and onboarding of new sales agents is a cash drain given their low initial productivity and long ramp time. We've used conversational AI role play simulations in our agent training program, reducing onboarding time for new agents by 40%. In addition, new agents are now providing double the productivity in the 1st 3 months compared to new agents last year. You will see this efficiency reflected in our AAP results this year. Next, our Customer 360 capabilities empower us to drive essential business insights. Speaker 200:13:38For example, we can now track a single consumer across multiple shopping seasons and monitor her progression across all touch points. When a return consumer calls us, we're able to recognize that consumer and auto populate where we left off the last time we spoke to them, be it 5 minutes, 5 months or 5 years ago. This memory of the consumer both reinforces the trust built with them that motivated their proactive outreach to us, as well as provides valuable information to the agent to support added effectiveness and efficiency during the call. Keep in mind, on average, 30% of the calls we get each AEP are from consumers we have served before. Additionally, we can analyze the behaviors of repeat consumers versus first time consumers at GoHealth delivering customized messaging and services to best serve their needs. Speaker 200:14:28We continue to be the industry leader in implementing technology and automation and we believe we are extending that lead. These initiatives are integral to our long term transformation from a company focused on Medicare enrollment to one that prioritizes continuous engagement with Medicare consumers. This shift aims to build lasting relationships and improve the overall consumer journey in the Medicare landscape. As we prepare for this year's AEP, which begins in 67 days, we are intensifying our targeted marketing efforts to better identify and reach consumers in need of new options. I am proud of our team's innovation and adaptability, which have led to just over 11% improvement in consumer acquisition cost or direct cost per submission, while upholding the integrity of our Encompass workflow and delivering exceptional service. Speaker 200:15:18Market dynamics have remained consistent since the last AEP, which are expected to yield lower volume and higher costs to those dynamics change in Q4. Due to the resiliency of the team, we have been able to offset some of these headwinds via operating efficiencies. You can expect us to continue delivering superior direct cost per submission compared to the industry. We believe a focus on direct cost per submission enables us to effectively manage expenses and investments in a highly regulated industry where benefits change annually, contracting dynamics change annually and consumer behavior can vary. We remain confident in our performance expectations for 2024 and beyond and continue to be driven by our commitment to transforming the consumer healthcare journey through continuous innovation and strategic foresight. Speaker 200:16:04I want to thank our team for their dedication to our values and our stakeholders for their ongoing support and commitment to delivering long term value. With that, I will turn it to Katie to detail our financial results. Speaker 300:16:16Thank you, Vijay, and good morning. Our 2024 second quarter performance continues to demonstrate the overall stability and resilience in our business model. 2nd quarter net revenues were $106,000,000 down from $143,000,000 in the Q2 of 2023, primarily due to a decrease in total submissions compared to the prior year. While our total submissions were down, submissions generated by our internal captive agents increased 14% year over year versus a 33% decline in submissions from our external GPS agents. A combination of enhanced training and technology for our agents along with more effective marketing efforts help drive the submission improvement by our internal captive team. Speaker 300:16:59I'd like to touch on the Change Healthcare and CrowdStrike technology incidents and how they've impacted GoHealth. We use Change Healthcare to assess Medicaid eligibility for consumers during our enrollment This incident negatively impacted 2nd quarter revenue by This incident negatively impacted 2nd quarter revenue by over $7,000,000 and earnings in the quarter by over $6,000,000 Our teams work diligently to work around this issue and the primary result was an increase in submissions under our traditional agency contracts versus our non agency contracts. We expect to have this issue fully resolved for AAP. The more recent CrowdStrike outage had a minimal impact on GoHealth and we do not expect it to impact our 3rd quarter results. Adjusted EBITDA was negative $12,000,000 for the quarter, a decrease of $13,000,000 from the same period of the prior year. Speaker 300:17:59The reduction in revenue and impact from Change Healthcare I noted were partially offset by improvements in our cost structure represented by a 12% reduction in direct cost per submission. These cost savings were primarily attributable to our targeted marketing efforts and we continue to gain more efficiencies through our investments in proprietary technology and our operating model. Cash flow used in operations was negative $24,000,000 year to date versus cash flow generated from operations of $31,000,000 in the first half of the prior year. The decrease of $55,000,000 year over year was primarily driven by $14,000,000 of fewer agency and non agency receipts, an $11,000,000 payment made in March to settle the securities class action litigation and $11,200,000 of interest paid in 2024 that related to the last 2 months of 2023. As a result of the nearly $60,000,000 paid to our term loan lenders during the quarter, we drew $15,000,000 from our revolving credit facility to fund operations during SEP. Speaker 300:19:07As is typical this time of year, we made investments to increase marketing efforts, enhance consumer engagement and maintain the level of service quality that our Medicare consumers expect. As part of our ongoing efforts to strengthen our financial position and support our growth initiatives, we are actively working to refinance our term loan and revolving credit facility. We have been pleased by the receptiveness and interest thus far. Our goal is to find the right structure and partner to ensure we can execute our long term strategy. We are assessing numerous options to address the upcoming maturities and look forward to updating you in the coming months. Speaker 300:19:46As Jay mentioned, several factors will influence our full year performance, many of which will become clearer during AEP. The evolving market dynamics are expected to result in tailwinds for submissions, revenue and adjusted EBITDA. However, we expect a year over year decline in cash flow from operations due to the shift from non agency revenue. Looking forward, we remain confident in our performance expectations for 2024. I will now turn the call back over to Jay for closing remarks. Speaker 200:20:18Thank you, Katie. We believe our strategic initiatives, particularly encompass Express, compensation for plant that saves and investments in cutting edge technologies such as AI and automation have not only boosted our operational efficiency, but also enhanced the service quality provided to Medicare consumers and our health plan partners. As I mentioned previously, we operate in a dynamically changing market landscape. However, we believe our nimbleness and resilience as an organization position us well to seize the many opportunities that will arise during this annual enrollment period and beyond. We expect GoHealth to continue as a national leader in enrolling consumers in appropriate Medicare Advantage plans for their needs. Speaker 200:21:01We're now ready to take your questions. Operator00:21:05Thank you. At this time, we'll conduct a question and answer session. Our first question comes from the line of Ben Hendricks of RBC Capital Markets. Your line is now open. Speaker 400:21:32Hey, good morning guys. Thank you very much. Quick question on just somewhat going back to the market dynamic. I was wondering if you could provide some more color on your thoughts on what is driving some of the competitor exits and if there are parallels there to kind of the lower submission volume among your external GPS agents. Is that all regulatory or are there other factors? Speaker 400:21:56And then maybe a little more detail on kind of how you're positioned to address some of the challenges there and opportunities that might present ahead of AEP? Thank Speaker 200:22:08you. Thank you, Ben, for the question. When you're speaking of market dynamics, I'm assuming you're talking about other brokerages and agencies and other entities who are in that shopping experience, who have exited that space. That's correct, right, Ben? Speaker 400:22:23Yes, that's right. Speaker 200:22:24Thank you. As it relates to that, again, I can't go too far into the details. I don't know all of their the reasoning behind it. But what I'll highlight for you is that, I think those of us who've been around this industry for a long time understand that it is constantly changing. You've got to have an appetite for understanding what the business is going to be, be able to predict things will continue to change and be prepared for those. Speaker 200:22:45And that includes investing in efficiency and not always just trying to maximize growth in the current period, but you need to make investments for the future. You have to have conviction in that model. You have to have the ability to deploy the cash to make those investments, and you need to be prepared to work and be nimble within any given enrollment season to do just that. And from our observations, there have been other parties who have been challenged by those changing dynamics. Maybe they weren't as focused on just the Medicare population understanding how that works. Speaker 200:23:18There may be parts of portfolios within larger organizations where there were some patients for what is a very nuanced business that you need to be focused on. So some of the information is around those CACs, cost per acquisition going up for those entities where we've seen nice efficiencies improvements year over year because we've thought through those dynamics. But really, I think it's a question about how you deploy your cash, invest and how you can meet your expectations on a multiyear basis as opposed to trying to maximize what you saw last year, the next year because the dynamics are always changing. So I know that's not a fulsome answer, because I just don't know all the details for everybody else, and I don't want to try to presume too much. But as it relates to some of our own downlines, yes, they've had some of those same challenges, access to their own capital structure, how they market, where they get how they can support their own agents throughout the course of the year. Speaker 200:24:14All of those things are relevant factors as to how they can produce more or less in any given time frame. Hopefully, that's helpful. Does that work for you, Ben? Speaker 400:24:25Yes, absolutely. Maybe go in to a little more detail on how you're approaching this kind of the changes in the regulations for 2025, any specific strategies to mitigate negative impacts from regulations and what you're doing there? Speaker 200:24:43Yes. And actually, I think I forgot one portion of your question earlier and it will relate to this as well. As we think about AEP and these competitive dynamics of another a lot of the different brokers agencies that aren't going to be there anymore that have either shut the doors or significantly decreased in size. We believe that's a positive for us because there's less mouths to feed, there's less lead demand, there's less confusing advertising. And this is why it's related to the regulatory component of what you described. Speaker 200:25:11If you look at the 2025 rule, that's the main thing that's going to stick now, which is the ability to enforce what has been really a lot of bad actors within the lead generation space to stop reselling consumer leads to multiple parties and leading to that confusion. And the reason why those lead generators were able to get away with that or at least to continue to do that as a business was because there were so much demand for leads. And so when we think about the compounding effect of these other brokerages and agencies within the landscape shutting down or no longer operating in the space, that will also help us so that we can have more efficiencies in our own lead generation and avoid confusion. And I'm hopeful that will lead to better compliance with what CMS has put out in the regulations that we've been compliant with for years. As we think about the overall implications, as we said earlier, all reads are that it's more business as usual for a company like ourselves. Speaker 200:26:12The final rule on the marketing rules really had very little implication on us at all anyway. But this just reinforces that there's less confusion and uncertainty amongst health plans as well on their interpretations of the rules that could have been there. Now we're able to really focus on how we can serve as many consumers as possible as we go into AEP. Speaker 400:26:34Thank you very much. If we could shift over to cap structure and your refinancing negotiations, You mentioned you're kind of assessing multiple structures. I wonder if you could give us some more detail on kind of receptivity to those structures. Are you looking at any type of unique securitization of receivables within those negotiations? And kind of what are the big sticking points in financing negotiations? Speaker 200:27:04Yes. I think, Ben, let me just start with the fact that we are we've been working really hard as a company for multiple years to make sure that we're solid and operating well. And that's coming through in the conversation we're having about looking at the capital structure of the company and looking at different refinancing options. We're looking at all the different options that are on the table and we made good progress on all fronts. And we're pretty excited about where we stand with it. Speaker 200:27:29So I won't go too far into that, but I'll say that we wanted to make sure we exhausted all the different potential options for an organization like us and where we are relative to the industry. And so we're pretty excited about how that's progressing thus far. Operator00:27:46Thank you. One moment for next question. Our next question comes from the line of Pat McCan of NOBLE Capital Markets. Your line is now open. Speaker 500:27:59Hey, good morning and thanks for taking my questions. My first question is, I wanted to talk a little bit about the agency versus non agency, just particularly because of the whole lifetime value issue that comes up with agency business. So I was wondering if you could maybe give a little more details as to how you consider customer retention when it comes to negotiating agency versus non agency agreements with the health carriers? Speaker 200:28:33Pat, good to hear from you. Thanks for the question. This is a really important component to our strategy and has been for a number of years now, which is this dynamic of agency versus non agency contract structures. And as we've said from the beginning, we never expect nor would want to have 100% one way or the other. And it's a year by year decision as to how we think about the market landscape, how we think about the track record of the health plans and their benefit structures by product and population type. Speaker 200:29:09And so even given any one carrier you may have or health plan you might have 1 agency versus and 1 non agency contract. Some health plans we might do a more exhaustive pre and post enrollment relationship on an agency or non agency basis. So a lot of different structures that you might put in place. But as we think about the market dynamics on a year over year basis, as you think the pressures that are put in place, when you see market dynamics that health plans are trying to do land grabs and really grow fast and aggressively, you kind of start to think about what does that do on an LTV basis of the tenure of the consumer. A consumer coming into Merrick with a very high benefit plan will have a higher probability of benefit coming down versus going up over time. Speaker 200:29:53When you reset benefits and you bring the benefits down to a more stable systematic basis, you're going to have more upward opportunity or stability in those benefit plans. So as we think about trajectories, track records of products, we think about in that vein. You may actually be better off staying on an agency contract versus a non agency contract with certain carriers based upon those dynamics and where we feel those benefits stack up for consumers. And so as you think about where we were last year, there were some major players. For example, Aetna grabbed a lot of share last year. Speaker 200:30:27As you know, they were a big leader in the space. And based upon that structure, we had them on a non agency contract, right? And you can see that play through as being a very good astute view on where the market was, given that Aetna is making a big clawback on their benefits this year as they've said publicly. So we didn't have that tail risk on that business. And so we're able to continue to serve that population as appropriate. Speaker 200:30:51As we look into the coming year, we make decisions as to which plans will be in our marketplace and offer to our consumers based upon what we think is going to be best for them and their rankings, etcetera. So I guess what I'm coming down to is if I believe this AEP, right, as we think about different carriers and what they're doing and thinking about bringing the benefits down to a more stable level to drive their margins. When you write business in that environment, different from even today, when you write in the new AEP with the new benefits that we expect to come out, you should have higher confidence in those cohorts retaining potentially better than historically have. So that's how we're starting to think about it. But again, it's plan by plan and it's product by product and population by population, the way we've discussed those. Speaker 200:31:36With an emphasis on those health plans to allow us to really serve the consumer in a greater way post enrollment because that's where the real service comes on retention and long term satisfaction. Speaker 500:31:47Got it. That makes sense. And it sounds like the strategy has a lot to do with, of course, your expectations for the upcoming enrollment period, which sort of leads me to my next question, which was just around the financial projections. And with the idea that you would have revenue that is relatively flat with some modest margin expansion, I was wondering to what extent does that bake in some of the possible upswings from the upcoming period given the market dynamics? Or to what extent does it sort of conservatively not include considerations for a strong enrollment period upcoming? Speaker 200:32:48So let me just kind of take you to a couple of things we said in our prepared remarks. One is that when we gave you those qualitative statements for the full year, what was contemplated at that time was the fact that market dynamics we saw last AEP of lots of shopping with no reason for appropriate switching would continue until new benefits release. So that would mean that Q1 through Q3 should have been lower than last year because of the market dynamics that we're continuing going forward. And if you kind of do the math on that with us saying generally flat year over year, you would have seen an upward expectation on the back part of the new benefit plan market dynamics in Q4. Based upon our early reads right now, we're seeing that there are some tailwinds, we believe based upon what we've observed so far. Speaker 200:33:35We don't know to the extent that that will be there, but we do believe there are tailwinds on revenue, adjusted EBITDA and total submission counts, especially given the advancements we've also been making and the early results that we feel pretty good about on efficiencies on that direct cost per submission via our technology, etcetera. So the only switch, as we've said, is that we're starting to see that potential decline on agency versus non agency mix that could impact the cash flow from operations estimates versus last year. But that's really the way we think about it right now is that we do see that on those qualitative top line, bottom line items, we see some positive tailwinds from the market dynamics we're observing right now and expecting to come to say EP. Operator00:34:20Thank you. One moment for our next question. Our next question comes from the line of Jim Sidoti of Sidoti and Co. Your line is now open. Speaker 600:34:31Hi. Thanks for taking the questions. So if you do have that shift towards agency revenue, do you still expect to be cash flow positive this year? And how do you do that? Speaker 200:34:45I think it's too early for us to get too far into exactly the extent to which shifts will happen. These are the right ways that we think about setting up our contracts. Again, we design the contracts with our assessment of the product qualities and we think our extent to which we can serve the consumers the best. And then whatever those contracts are year over year, we have a distribution of agency versus non agency. And depending on which product matches best, we'll determine the extent to which that shift may happen between agency and non agency. Speaker 200:35:14So it's just it's too early to tell. I don't want to get you there. All I know is that it's likely not going to be the same distribution of non agency as we saw last year. And therefore, that would lead to a lower than what we experienced last year in cash flow from operations. But again, they're all for the right reasons. Speaker 200:35:29It's the right plan for the consumer and the way we as appropriately decided which contracts and or products that we prefer to be on agency versus non agency to deliver the greatest value for us as well, right, meaning on a revenue and adjusted EBITDA basis, risk adjusted from the way we think about it. So I know you're looking for more of a specific answer, but I just think it's a little too early for us to get too far into that till we know more about the details of the benefit distribution in a more precise way, which won't be evident until closer to October. Speaker 600:36:01All right. And then how are you doing with the use of AI to improve efficiency? Are there any how is that going so far? And do you expect that to continue to improve throughout the year? Speaker 200:36:19No, I love the question. It's one of the things that has been at the core of what we've been doing for the last couple of years when we talk about Plan FIT. And we really haven't described it in a way that I think the market really has had a chance to understand how unique it really is. When you take these 30,000,000 interactions that we've had and the live interactions we're having every day with consumers and feathering that into how to make the best recommendations for plans, We know, for instance, that when a plan fit checkup is done and our proprietary plan fit tool uses its logic and AI thinking to really estimate and rank the appropriate most suitable plans for the consumers that when we write one of the top plans, it has the highest retention, highest satisfaction for the consumers. So when we start to think again around the agency versus non agency model, regardless of what type of contract it is, we know that our tools have been designed now to be able to enable the agent to recommend a plan that has the highest probability of the highest tenure and retention value for that consumer because it's the most drives the most customer satisfaction. Speaker 200:37:27So that's one big place that we've been doing and continuing to develop to do it. We highlighted on the prepared remarks around what we've been doing on training, which is going to come through in significant efficiencies, this AEP. As we think about the onboarding speed, 40% improvements in that, getting to double the productivity that we saw last year, in early phases of the gestation of these agents with us. It's a really important component of how you can give live advance for agents to learn on the fly. And so they can do it on their schedule and we can do it on our appropriate timelines in different scenarios. Speaker 200:38:05So they're most prepared to serve this population. And given the amount of focus that health plans have been putting specifically on wanting to grow within special needs populations, that's where you need the most training to be great. It's what our agents do better than anyone else. It is their ability to anticipate the needs of special needs populations, the unique questions about how to access care and be able to resolve and build that trust on the phone. That is what is truly differentiating. Speaker 200:38:31And our AI tools have enabled us to do that with training. It's enabling us to do that with high value recommendations, so it drives highest retention. And we're continuing to use that information to figure out how to best anticipate the needs of the consumers and market to them directly and support that effort. Operator00:38:56Our next question comes from the line of Sandeep Soria of Delaware Street Capital. Your line is now open. Speaker 200:39:02Hi, this is Sandeep. Can you guys hear me okay? Yes. Good morning, Sandeep. Speaker 700:39:06Hi, good morning. Thanks for taking the question. First question was why did non agency revenue decline year over year given kind of the shifts and the repositioning of the business? And I have a couple of other questions, but I'm going to ask them one at a time. Speaker 200:39:20Yes. I think the question on non agency is one that's really determined on market dynamics. Like we said, there's one big piece, which is market dynamics of which products are most appropriate this year and what are the contracts that we have in place. The other piece that Katie highlighted was the dynamic around the change health care outage because there are a number of components of things that we need to do in the way we enroll a consumer to be eligible for non agency compensation with the different health plans. And due to some of the eligibility challenges we had due to the crowd or sorry, the change health care outage, it led us to needing to write some of those enrollments or those applications under an agency basis. Speaker 200:40:03So there was some shift for that alone. But generally speaking, it really is just a distribution of what consumers came in and which products best match for them. And we don't put our thumb on the scale to push it one way or the other. Really, the consumers' needs and who comes in determines what that split will be. And we are comfortable with those splits because we think those are the best value for us as well if those were to match for the consumers' needs. Speaker 700:40:30Got it. So the $7,000,000 impact that was highlighted earlier, that could have been more on the non agency side, but because of the change outage, it was a there was a complete shift to the commission part, commission revenue. Is that the right takeaway? Speaker 200:40:48I don't think it's all of it, but I'd say a good portion of it that's a fair set. Speaker 700:40:53Okay, got it. Great. Thanks. And then on the GPS agents, why did they go down? Why did that performance go down? Speaker 700:41:00And are those agents shifting to another or an FMO? Are they leaving the industry? Can you give us a little more color on what happened there? Speaker 200:41:10Yes. I mean, it's twofold. So 1, in any given year, you also always have well, let me take a step back and talk about strategic value of what the Go Partner Solutions or GPS is for us. It's a great way for us to get access to high quality variable capacity with no fixed cost expense for those periods of high volume in AEP, OEP, etcetera, and even through the SEC periods as well. So we think it's a unique differentiator for us to do that. Speaker 200:41:38We provide them tools. We provide them access to our relationships, insights, training, etcetera, to do that. And we've had many we have different agencies of different size that participate in our downline business. And some of them went out of business. They like we said before, they were trying to grow really fast and they didn't have the cash to really support it and they didn't have the continued access to capital to make the investments that they needed. Speaker 200:42:06And so some of them just went away. Some of them have decided to reprioritize where they want to grow and what they're going to offer and whether it's different to the extent of the volume they're going to devote to this type of this product. And therefore, you can see some differences there. Some will leave on their own and want to go do their own thing and that's great for them. It could be the right thing for them to do depending on what size they're at and that makes a lot of logical sense. Speaker 200:42:30But at the same time, we are also onboarding, right? And we've onboarded, let's call it, up to 10, maybe even more we might pull into the process by the time we're all done in this AEP and those will be significant contributors to our volume in that channel. But it's a normal cycle. You'll have ones that come in and go out. But I'll say over the last couple of years, we've seen more that shut down and shut their doors due to all the market dynamics that we've been seeing out there. Speaker 200:42:58Some are seeing more explicit at the largest scale of some of the players that are shutting it down and ours are more mid to smaller scale that are participating in our GTS external agent group. Speaker 700:43:09Got it. Great. Thanks. And then when I look at trailing 12 months submissions, I noticed that obviously the company went through a period of massive growth years ago and then it was negative growth as the business has stabilized, like very negative. And now it's starting to flatten on a trailing 12 month basis and I believe revenues are as well. Speaker 700:43:32How should we think about that? Is that the sign that like just I just wonder your thoughts when you look at the business on a trailing 12 month basis from a submissions perspective and then also from a revenue perspective? Speaker 200:43:45No, it's a great question. I really appreciate it, Cindy, because this is the when I say conviction to the business strategy, that's really important. Is that if I know everybody wants growth, but you've got to determine what the market allows to drive efficiency and prudence around cash deployment. You can drive your growth if you wanted to, if you want to burn a bunch of cash to go there and the market will determine how efficient you can be. And so as you think about the market dynamics we saw last AP on a TTM basis, you're getting a bunch of that, right? Speaker 200:44:16The market dynamics that we've already highlighted In any given marketplace, you can have 3 scenarios, right, of market dynamics between health plans. You can have a scenario where health plans are all being really aggressive and wanting to grow and that causes disruption and that's an efficient market for us to deploy cash and drive submission volumes, etcetera. The next option is that there's not a lot of investment in benefits. It's kind of a push. And if you care about doing what's only appropriate for the consumer, it's going to be a less efficient market for you, lots of window shopping, not a lot of appropriate switching. Speaker 200:44:45And then finally, you're going to have a market where there's a lot of negative disruption that brings a lot of shoppers in place and that's a very efficient market. So what you'd want to see from us is that when we see those dynamics that we've seen since last AEP and that will run through the Q3 of this year, that you want us to be prudent in the deployment of cash because it is not an efficient way to deploy cash to drive growth. You want to be thoughtful about saving that dry powder and being effective when you see the market dynamics coming as we're anticipating in Q4 of this year. But what you have been seeing is over that time, we've been investing in driving efficiencies so that when you do deploy that cash, you're not getting the diseconomies of scale. I think we have a lot of tailwinds around that given the fewer mouths to feed around lead volume because of industry compression of agents out there trying to sell this to our markets as seniors or Medicare consumers as well as our deployment of technology to drive efficiency on the operational side. Speaker 200:45:38Those two things are preparing us to have a pretty exciting and what we think AEP with lots of dynamism that really are positive for the GoHealth business model. Speaker 700:45:48Great. Thanks for that color. Last question for me is, how do you think about revenue from PlanFit, Check? And the secondary follow-up question to PlanFit in the quarter was, I saw that submissions were down about 6%, but PlanFit was I think you said $125,000 I can't remember. So should I be thinking, oh, if I add submissions to PlanFit, that gives me an idea of the number of engagements that you guys did in the quarter. Speaker 700:46:24Walk me through how I should think about both the revenue opportunity for plant fit and then how I should think about submissions in plant fit as a metric, so I can better understand the underlying business? Speaker 200:46:36Yes. So as you think about this is and I'm going to try to keep this as organized as possible. But the way you're thinking about it is right. So we have an X number of submissions or let me kind of take you to the top of funnel. We have a number of consumers that reach out to us who need support in the shopping experience. Speaker 200:46:53Of those, we're able to take them through a full plan fit checkup, right? And that experience can result in those three outcomes that I described before, either we enroll them a new product that's better for them, we tell them another product is better for them, but they choose they don't want to do anything, or you go all the way to the end and we tell them, hey, you're on the right process. And of that total process, you would take the total submission plus the number ones that we just gave peace of mind, add them together, and that's the ones that would be generally available, call it, I think, with 230,000 or so. We talk about what we did in our internal agent pool this last quarter. And so you would say of those, which one then you have a distribution of how many get enrolled and then how many would be eligible potentially for a plan fit today because you got to get them through the whole process. Speaker 200:47:35Do a full checkup to get eligible for a plan fit today. And then it varies by health plan from there. But the way I think about our business plan, our business plan is to take the top of funnel all the way through anybody who's outreach to us, how do we get as many of those interactions to add value to the consumer and then be able to generate revenue for us for doing that work. But staying true to do right for the consumer and find ways to make it work for everybody. So what's beautiful about PlanFitSave is that when we do that work, we're providing peace of mind to the consumer. Speaker 200:48:05We're providing really low cost to no cost retention services for health plans who invest 1,000,000 of dollars every year trying to figure out how to engage with that population and keep them retained and satisfied. And we're also able to reorient that consumer so that they can really get the maximum value out of those benefits that made them shopping in the 1st place. They don't remember what the benefits were. They weren't understanding how to utilize them. We can reorient them at that time. Speaker 200:48:31And now we're having the ability to start to get compensated for that work. And that is what you can expect from us. Do the right thing, prove that everybody wins from it and then find a way to ensure that we are getting revenue or compensated for that work that we're doing in a very symbiotic way. And so the way to think about it. I think at top of funnel, all those interactions, we're continuously working to find more and more of that that is going to be able to be compensated for hard work we do. Speaker 200:49:00Most of the industry driving it just conversion, conversion, conversion, convert to a new enrollment. That's the only thing that triggered compensation in the past. And now we're finding ways from just doing the right thing, we're starting to get compensated for that as well in addition to appropriately enrolling, all doing what's right for the consumer and right for the health plan. So that's what's really exciting about where we're going, what Plan Fit Safe is opening up. And we're making great progress and have really good demand from the health plan to jump on board to this added element of the reorientation on top of a typical plan to check up to reengage the consumer with those health plans. Operator00:49:38Thank you. This concludes the question and answer session. I'd now like to turn it back to Vijay Kote for closing remarks. Speaker 200:49:44Thank you all for your attention and participation in today's call. We are very excited about what is there to come. Our team has been working diligently to prepare not just for this annual enrollment period, but where we're anticipating the needs of the population and the overall Medicare landscape to be for years to come. What you learned if you've been around this business for a while, it's not just a seasonal business, it's a cyclical business. And you need to make investments and prepare for all of that. Speaker 200:50:12And we made those investments in plan fit checkups last year and you're seeing the value of that with plan fit saves as we anticipated the need for health plans to really focus on retention as well as targeted growth. Our tools, our team, our commitment to the consumer is what differentiates us and enables us to be more predictable in these types of changing environments. We stabilize what seems to be a volatile market and that's exciting I think for us, for our consumers, for our team and for our shareholders. So thank you for your time and your continued interest in our organization. Operator00:50:46Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.Read morePowered by Conference Call Audio Live Call not available Earnings Conference CallGoHealth Q2 202400:00 / 00:00Speed:1x1.25x1.5x2x Earnings DocumentsSlide DeckPress Release(8-K)Quarterly report(10-Q) GoHealth Earnings HeadlinesGoHealth (NASDAQ:GOCO) Trading Down 5.3% - What's Next?April 22, 2025 | americanbankingnews.comGoHealth Extends CEO Vijay Kotte’s Contract and CompensationApril 7, 2025 | tipranks.comMassive dollar overhaul underway in D.C.?Trump's plan to save the U.S. Dollar The U.S. Dollar is crashing, and our reserve currency status is now in serious jeopardy leaving some to wonder – is this being done by design? A 25-year economist and investor answers here... and details the exact steps you should be taking with your money to prepare.April 28, 2025 | Stansberry Research (Ad)RBC Capital Keeps Their Hold Rating on GoHealth (GOCO)March 11, 2025 | markets.businessinsider.comGoHealth, Inc.: GoHealth Reports Strong Fourth Quarter and Fiscal Year 2024 Results, Driven by a Successful Annual Enrollment PeriodFebruary 28, 2025 | finanznachrichten.deGoHealth (GOCO) Gets a Buy from Noble FinancialFebruary 28, 2025 | markets.businessinsider.comSee More GoHealth Headlines Get Earnings Announcements in your inboxWant to stay updated on the latest earnings announcements and upcoming reports for companies like GoHealth? Sign up for Earnings360's daily newsletter to receive timely earnings updates on GoHealth and other key companies, straight to your email. Email Address About GoHealthGoHealth (NASDAQ:GOCO) operates as a health insurance marketplace and Medicare-focused digital health company in the United States. The company operates a technology platform that leverages machine-learning algorithms of insurance behavioral data to optimize the process for helping individuals find the health insurance plan for their specific needs. It provides Medicare plans, including Medicare Advantage, Medicare Supplement and Prescription Drug, and Medicare Special Needs Plans. The company also offers partner marketing services. It sells its products through carriers and online platform, as well as independent and external agencies. The company was founded in 2001 and is headquartered in Chicago, Illinois.View GoHealth ProfileRead more More Earnings Resources from MarketBeat Earnings Tools Today's Earnings Tomorrow's Earnings Next Week's Earnings Upcoming Earnings Calls Earnings Newsletter Earnings Call Transcripts Earnings Beats & Misses Corporate Guidance Earnings Screener Earnings By Country U.S. Earnings Reports Canadian Earnings Reports U.K. Earnings Reports Latest Articles Markets Think Robinhood Earnings Could Send the Stock UpIs the Floor in for Lam Research After Bullish Earnings?Texas Instruments: Earnings Beat, Upbeat Guidance Fuel RecoveryMarket Anticipation Builds: Joby Stock Climbs Ahead of EarningsIs Intuitive Surgical a Buy After Volatile Reaction to Earnings?Seismic Shift at Intel: Massive Layoffs Precede Crucial EarningsRocket Lab Lands New Contract, Builds Momentum Ahead of Earnings Upcoming Earnings AstraZeneca (4/29/2025)Booking (4/29/2025)DoorDash (4/29/2025)Honeywell International (4/29/2025)Mondelez International (4/29/2025)PayPal (4/29/2025)Regeneron Pharmaceuticals (4/29/2025)Starbucks (4/29/2025)American Tower (4/29/2025)América Móvil (4/29/2025) Get 30 Days of MarketBeat All Access for Free Sign up for MarketBeat All Access to gain access to MarketBeat's full suite of research tools. 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There are 8 speakers on the call. Operator00:00:00Good morning, and welcome to GoHealth Second Quarter 20 24 Earnings Conference Call. My name is Marvin, and I'll be your operator for today's call. Currently, all participants are in a listen only mode. Following the prepared remarks, we will conduct a question and answer session. As a reminder, this conference is being recorded. Operator00:00:18I'll now turn the call over to John Shea, Vice President of Investor Relations. John, you may begin. Speaker 100:00:26Thank you, and good morning. Welcome to GoHealth's Q2 2024 earnings call. Joining me today are Vijay Cote, Chief Executive Officer and Katie O'Halloran, Interim Chief Financial Officer. Today's conference call contains forward looking statements based on our current expectations. Numerous known and unknown risks and uncertainties may cause actual results to differ materially from those anticipated or projected in these statements. Speaker 100:00:53Many of the factors that will determine future results are beyond the company's ability to control or predict. You should not place undue reliance on any forward looking statements and the company undertakes no obligation to update or revise any of these statements whether due to new information, future events or otherwise. Earlier today, we issued a press release containing our results for the Q2 of 2024. We have posted the release on the GoHealth website under the Investor Relations tab. In conjunction with our forward looking statements, we encourage you to consider the other risk factors described in our 2023 Annual Report on Form 10 ks and our other filings with the SEC for additional information. Speaker 100:01:35During this call, we will be discussing certain non GAAP financial measures. These measures are reconciled to the most directly comparable GAAP financial measure and the reconciliations are set forth in the press release. I will now turn the call over to GoHealth's CEO, Vijay Cote. Speaker 200:01:50Thank you, John, and good morning, everyone. I'd like to begin by sharing commentary on our quarterly performance along with updates on our general business activities and initiatives. In the Q2 of 2024, our internal captive team empowered nearly 525 1,000 consumers to navigate their Medicare options utilizing the PlanFit checkup via our proprietary encompass workflow. Along with supporting over 155,000 new enrollments in Q2, we also provide a peace of mind to over 125,000 consumers confirming their current plan is best for their needs. Our performance during Q2's special enrollment period or SVP exceeded our expectations for submissions, revenue and adjusted EBITDA. Speaker 200:02:35While our total submissions were down 6%, submissions generated by our internal captive agents increased 14% year over year versus a 33% decline in submissions from our external Go partner solutions or GPS agents. We are particularly pleased with our internal captive results, especially considering the shopping and switching dynamics have remained unchanged since the last annual enrollment period or AEP and are not expected to change significantly until Q4 of this year when health plans release new benefits. Due to market dynamics, we anticipated year over year declines from Q1 through Q3. Our team has managed these expected factors by driving efficiencies and reducing costs. We believe these results show the benefit of our proprietary Encompass workflow and plan fit checkout process. Speaker 200:03:24At GoHealth, our mission is to provide support and clarity to Medicare consumers in a landscape often marked by confusion and uncertainty. There are over 65,000,000 Medicare eligible individuals in the United States and approximately half of them are enrolled in Medicare Advantage Plans. 1 third of Medicare consumers live in counties with more than 50 plans available. The abundance of options can be overwhelming. This complexity often deters consumers from shopping for better options because they are unsure of who to trust or where to begin. Speaker 200:03:57We believe GoHealth is the premier resource to empower these individuals to make informed and personal decisions because of our proprietary and objective tools as well as our well trained tenured agent workforce. We are continuing our evolution from a traditional Medicare enrollment company to a Medicare engagement company, focusing on building high quality long term relationships with our consumers. We believe this shift emphasizes a more integrated and interactive approach to consumer care, cementing our unique and vital role in the Medicare landscape. On our last two quarterly calls, we highlighted several market factors that could influence our performance this year. Due to the dynamics of the industry, we expect clarity on the impact of these factors in Q4 once AEP starts. Speaker 200:04:43As typical, the market dynamics we observe in the Q4 of 2024 for AEP will continue for a full 4 quarters running through the Q3 of 2025. As a reminder, there are 5 key market factors. 1, the final rate notice on commissions for the 2025 plan year 2, the final 2025 marketing rule from the Centers for Medicare Medicaid Services or CMS 3, planned product and benefit differentiation between 2024 2025 4, marketing efficiency within this election season and finally, relative health plan competitiveness and its effect on plan mix. As we become more selective in the health plans we include in our marketplace, this factor impacts sales per submission or revenue per sale and agency versus non agency revenue distribution. As we report our Q2 results, we have updates regarding these factors. Speaker 200:05:44On Market Factor 1, as we previously discussed, CMS issued the final rate notice, which aligns with our expectations for the base commission schedule. The 2025 final rate notice introduced margin pressure for health plans, which we believe will likely lead to benefit disruptions and market exits, particularly for non special needs plans. Major health plans confirm significant upcoming benefit disruptions in their Q1 earnings calls. Similarly, we expect on average 20% plus increases in premiums for beneficiaries currently on Medicare Supplements. We believe these rate increases and disruptions could lead to a significant increase in consumer shopping and switching during the upcoming AEP, presenting a positive opportunity for GoHealth's business model. Speaker 200:06:32More recently, many health plans had the opportunity to resubmit their bids due to a series of successful lawsuits on STAR scores. While this may change AP's competitive dynamics, we know that many health plans are targeting growth in specific markets and products. Notably, some are focusing on the special needs population, a segment that GoHealth is uniquely equipped to attract and serve. These strategies and priorities will vary by health plan and geography, but we believe we are ideally positioned to help health plans achieve targeted and measured growth. On market factor 2, in April, CMS published the final 2025 marketing rules, addressing independent agent and broker compensation and introducing new guidelines. Speaker 200:07:15However, the U. S. District Court in Texas stayed the effective date of the compensation provisions of the rule and later CMS acknowledged that because of the court's order, the status quo would be maintained through AEP. As we have already commented, we believe the final rule as published had minimal impact to our business model, but the court order and subsequent CMS guidance confirms that it is business as usual. The one part of the rule that we expect to be implemented as planned pertains to the restrictions in the new rules surrounding conduct commonly attributed to lead generators. Speaker 200:07:51Those restrictions should not affect GoHealth because we held ourselves to the standards of the new rule years before the rule was even proposed. And accordingly, we think these restrictions are good for the industry at large to protect consumers from confusing and unintended sales calls. As we contemplate the remaining factors, we are cautiously optimistic about shopping and appropriate switching during AEP. As part of our strategic shift from enrollment to engagement, we believe in building trusted relationships with consumers and putting them in the right plan for their needs. As a reminder, we have always indicated that we plan to have a portfolio of agency and non agency contracts varying by health plan and product, but mix would be dependent on the plans most suitable for the consumers we serve. Speaker 200:08:38Based on our early reads, though still to be refined based on actual benefit releases later this year, we see a mix shifting towards contracts with agency arrangements versus non agency arrangements. The evolving market dynamics are expected to result in tailwinds for submissions, revenue and adjusted EBITDA. However, we expect a year over year decline in cash flow from operations due to the shift from non agency revenue. We are committed to supporting the consumer throughout their Medicare journey and believe doing the right thing will ultimately increase engagement and retention. We look forward to providing an update during our November quarterly results call once AP dynamics start to play out. Speaker 200:09:16Additionally, there are 2 emerging market factors that I'd like to discuss. 1st, several midsized brokers have ceased operations due to evolving market dynamics and poor management of customer acquisition costs. We believe this will lead to less competition for leads and generally for the attention of Medicare consumers during AEP, a potential tailwind for GoHealth. In addition, the seasoned agents entering the market offer us the opportunity to pick up tenured new hires as we ramp for AEP. 2nd, GoHealth's external GPS agents have seen fewer submissions year over year through Q2. Speaker 200:09:52Dove Health partners with several smaller brokers as downlines who leverage our technology platform, health plan relationships and support teams to operate effectively. These brokers are also experiencing market pressures resulting in lower production. To offset their lower production, we are in the midst of onboarding several new agencies who we expect to meaningfully contribute to GPS submissions to this AEP. Now let me move from market factors to some exciting developments regarding our strategic investments. In the Q4 of 2023, we announced the launch of PlanFit Checkup. Speaker 200:10:25This innovative service powered by our proprietary AI driven PlanFit tool is designed to alleviate stress and enhances the experience for consumers shopping for a Medicare Advantage plan. As we have previously shared, plan fit checkup delivers 3 key consumer outcomes. 1, enrolling a consumer in a new plan that better suits their needs. 2, informing the consumer about a superior plan even if they choose not to switch. And 3, reassuring the consumer that their current plan remains the best option for their needs resulting in no enrollment change. Speaker 200:11:01Importantly, GoHealth agents are compensated for completing a plan fit checkup regardless of whether the assessment leads to a new enrollment. This ensures that our agents remain focused on providing the best advice and service to our consumers. Based on our launch results, we are well on our way to operationalizing reimbursement for a subset of these plan fit checkups in what we call a plan fit save with a select few strategic health plan partners. A plan fit save is a plan fit check up where our agents reassure the consumer that their current plan remains the best option for their needs, resulting in no enrollment change and we help the consumer understand and navigate the benefits of their current plan that are most valuable to them. Process, we earned compensation for doing the right thing for consumers as well as protecting the existing membership of our health plan partners. Speaker 200:11:52This year, we are focusing on streamlining processes and improving call handle times. As part of this effort, we launched Encompass Express, an enhanced consumer centric model built on the foundation of our original Encompass workflow. Encompass Express includes streamlined scripting and handoffs, utilizing tech driven standardization and automation to deliver efficiency and enhance the consumer experience while maintaining quality. Notably, we have reduced consumer on phone time by approximately 25% from 90 minutes to 67 minutes. We anticipate these changes will positively impact our financial results more substantively this fall during AAP. Speaker 200:12:32We are dedicated to advancing our technology to elevate the consumer experience, boost agent efficiency and enhance overall quality. Our strategic investments focused on several key areas. 1st, we are running programs integrating AI and automation into our operations. This initiative aims to streamline processes including agent onboarding, enhanced agent efficiency and deliver more precise data driven insights to improve the overall consumer experience. One great example of this is how we have deployed AI to support agent ramp. Speaker 200:13:05History has shown us that training and onboarding of new sales agents is a cash drain given their low initial productivity and long ramp time. We've used conversational AI role play simulations in our agent training program, reducing onboarding time for new agents by 40%. In addition, new agents are now providing double the productivity in the 1st 3 months compared to new agents last year. You will see this efficiency reflected in our AAP results this year. Next, our Customer 360 capabilities empower us to drive essential business insights. Speaker 200:13:38For example, we can now track a single consumer across multiple shopping seasons and monitor her progression across all touch points. When a return consumer calls us, we're able to recognize that consumer and auto populate where we left off the last time we spoke to them, be it 5 minutes, 5 months or 5 years ago. This memory of the consumer both reinforces the trust built with them that motivated their proactive outreach to us, as well as provides valuable information to the agent to support added effectiveness and efficiency during the call. Keep in mind, on average, 30% of the calls we get each AEP are from consumers we have served before. Additionally, we can analyze the behaviors of repeat consumers versus first time consumers at GoHealth delivering customized messaging and services to best serve their needs. Speaker 200:14:28We continue to be the industry leader in implementing technology and automation and we believe we are extending that lead. These initiatives are integral to our long term transformation from a company focused on Medicare enrollment to one that prioritizes continuous engagement with Medicare consumers. This shift aims to build lasting relationships and improve the overall consumer journey in the Medicare landscape. As we prepare for this year's AEP, which begins in 67 days, we are intensifying our targeted marketing efforts to better identify and reach consumers in need of new options. I am proud of our team's innovation and adaptability, which have led to just over 11% improvement in consumer acquisition cost or direct cost per submission, while upholding the integrity of our Encompass workflow and delivering exceptional service. Speaker 200:15:18Market dynamics have remained consistent since the last AEP, which are expected to yield lower volume and higher costs to those dynamics change in Q4. Due to the resiliency of the team, we have been able to offset some of these headwinds via operating efficiencies. You can expect us to continue delivering superior direct cost per submission compared to the industry. We believe a focus on direct cost per submission enables us to effectively manage expenses and investments in a highly regulated industry where benefits change annually, contracting dynamics change annually and consumer behavior can vary. We remain confident in our performance expectations for 2024 and beyond and continue to be driven by our commitment to transforming the consumer healthcare journey through continuous innovation and strategic foresight. Speaker 200:16:04I want to thank our team for their dedication to our values and our stakeholders for their ongoing support and commitment to delivering long term value. With that, I will turn it to Katie to detail our financial results. Speaker 300:16:16Thank you, Vijay, and good morning. Our 2024 second quarter performance continues to demonstrate the overall stability and resilience in our business model. 2nd quarter net revenues were $106,000,000 down from $143,000,000 in the Q2 of 2023, primarily due to a decrease in total submissions compared to the prior year. While our total submissions were down, submissions generated by our internal captive agents increased 14% year over year versus a 33% decline in submissions from our external GPS agents. A combination of enhanced training and technology for our agents along with more effective marketing efforts help drive the submission improvement by our internal captive team. Speaker 300:16:59I'd like to touch on the Change Healthcare and CrowdStrike technology incidents and how they've impacted GoHealth. We use Change Healthcare to assess Medicaid eligibility for consumers during our enrollment This incident negatively impacted 2nd quarter revenue by This incident negatively impacted 2nd quarter revenue by over $7,000,000 and earnings in the quarter by over $6,000,000 Our teams work diligently to work around this issue and the primary result was an increase in submissions under our traditional agency contracts versus our non agency contracts. We expect to have this issue fully resolved for AAP. The more recent CrowdStrike outage had a minimal impact on GoHealth and we do not expect it to impact our 3rd quarter results. Adjusted EBITDA was negative $12,000,000 for the quarter, a decrease of $13,000,000 from the same period of the prior year. Speaker 300:17:59The reduction in revenue and impact from Change Healthcare I noted were partially offset by improvements in our cost structure represented by a 12% reduction in direct cost per submission. These cost savings were primarily attributable to our targeted marketing efforts and we continue to gain more efficiencies through our investments in proprietary technology and our operating model. Cash flow used in operations was negative $24,000,000 year to date versus cash flow generated from operations of $31,000,000 in the first half of the prior year. The decrease of $55,000,000 year over year was primarily driven by $14,000,000 of fewer agency and non agency receipts, an $11,000,000 payment made in March to settle the securities class action litigation and $11,200,000 of interest paid in 2024 that related to the last 2 months of 2023. As a result of the nearly $60,000,000 paid to our term loan lenders during the quarter, we drew $15,000,000 from our revolving credit facility to fund operations during SEP. Speaker 300:19:07As is typical this time of year, we made investments to increase marketing efforts, enhance consumer engagement and maintain the level of service quality that our Medicare consumers expect. As part of our ongoing efforts to strengthen our financial position and support our growth initiatives, we are actively working to refinance our term loan and revolving credit facility. We have been pleased by the receptiveness and interest thus far. Our goal is to find the right structure and partner to ensure we can execute our long term strategy. We are assessing numerous options to address the upcoming maturities and look forward to updating you in the coming months. Speaker 300:19:46As Jay mentioned, several factors will influence our full year performance, many of which will become clearer during AEP. The evolving market dynamics are expected to result in tailwinds for submissions, revenue and adjusted EBITDA. However, we expect a year over year decline in cash flow from operations due to the shift from non agency revenue. Looking forward, we remain confident in our performance expectations for 2024. I will now turn the call back over to Jay for closing remarks. Speaker 200:20:18Thank you, Katie. We believe our strategic initiatives, particularly encompass Express, compensation for plant that saves and investments in cutting edge technologies such as AI and automation have not only boosted our operational efficiency, but also enhanced the service quality provided to Medicare consumers and our health plan partners. As I mentioned previously, we operate in a dynamically changing market landscape. However, we believe our nimbleness and resilience as an organization position us well to seize the many opportunities that will arise during this annual enrollment period and beyond. We expect GoHealth to continue as a national leader in enrolling consumers in appropriate Medicare Advantage plans for their needs. Speaker 200:21:01We're now ready to take your questions. Operator00:21:05Thank you. At this time, we'll conduct a question and answer session. Our first question comes from the line of Ben Hendricks of RBC Capital Markets. Your line is now open. Speaker 400:21:32Hey, good morning guys. Thank you very much. Quick question on just somewhat going back to the market dynamic. I was wondering if you could provide some more color on your thoughts on what is driving some of the competitor exits and if there are parallels there to kind of the lower submission volume among your external GPS agents. Is that all regulatory or are there other factors? Speaker 400:21:56And then maybe a little more detail on kind of how you're positioned to address some of the challenges there and opportunities that might present ahead of AEP? Thank Speaker 200:22:08you. Thank you, Ben, for the question. When you're speaking of market dynamics, I'm assuming you're talking about other brokerages and agencies and other entities who are in that shopping experience, who have exited that space. That's correct, right, Ben? Speaker 400:22:23Yes, that's right. Speaker 200:22:24Thank you. As it relates to that, again, I can't go too far into the details. I don't know all of their the reasoning behind it. But what I'll highlight for you is that, I think those of us who've been around this industry for a long time understand that it is constantly changing. You've got to have an appetite for understanding what the business is going to be, be able to predict things will continue to change and be prepared for those. Speaker 200:22:45And that includes investing in efficiency and not always just trying to maximize growth in the current period, but you need to make investments for the future. You have to have conviction in that model. You have to have the ability to deploy the cash to make those investments, and you need to be prepared to work and be nimble within any given enrollment season to do just that. And from our observations, there have been other parties who have been challenged by those changing dynamics. Maybe they weren't as focused on just the Medicare population understanding how that works. Speaker 200:23:18There may be parts of portfolios within larger organizations where there were some patients for what is a very nuanced business that you need to be focused on. So some of the information is around those CACs, cost per acquisition going up for those entities where we've seen nice efficiencies improvements year over year because we've thought through those dynamics. But really, I think it's a question about how you deploy your cash, invest and how you can meet your expectations on a multiyear basis as opposed to trying to maximize what you saw last year, the next year because the dynamics are always changing. So I know that's not a fulsome answer, because I just don't know all the details for everybody else, and I don't want to try to presume too much. But as it relates to some of our own downlines, yes, they've had some of those same challenges, access to their own capital structure, how they market, where they get how they can support their own agents throughout the course of the year. Speaker 200:24:14All of those things are relevant factors as to how they can produce more or less in any given time frame. Hopefully, that's helpful. Does that work for you, Ben? Speaker 400:24:25Yes, absolutely. Maybe go in to a little more detail on how you're approaching this kind of the changes in the regulations for 2025, any specific strategies to mitigate negative impacts from regulations and what you're doing there? Speaker 200:24:43Yes. And actually, I think I forgot one portion of your question earlier and it will relate to this as well. As we think about AEP and these competitive dynamics of another a lot of the different brokers agencies that aren't going to be there anymore that have either shut the doors or significantly decreased in size. We believe that's a positive for us because there's less mouths to feed, there's less lead demand, there's less confusing advertising. And this is why it's related to the regulatory component of what you described. Speaker 200:25:11If you look at the 2025 rule, that's the main thing that's going to stick now, which is the ability to enforce what has been really a lot of bad actors within the lead generation space to stop reselling consumer leads to multiple parties and leading to that confusion. And the reason why those lead generators were able to get away with that or at least to continue to do that as a business was because there were so much demand for leads. And so when we think about the compounding effect of these other brokerages and agencies within the landscape shutting down or no longer operating in the space, that will also help us so that we can have more efficiencies in our own lead generation and avoid confusion. And I'm hopeful that will lead to better compliance with what CMS has put out in the regulations that we've been compliant with for years. As we think about the overall implications, as we said earlier, all reads are that it's more business as usual for a company like ourselves. Speaker 200:26:12The final rule on the marketing rules really had very little implication on us at all anyway. But this just reinforces that there's less confusion and uncertainty amongst health plans as well on their interpretations of the rules that could have been there. Now we're able to really focus on how we can serve as many consumers as possible as we go into AEP. Speaker 400:26:34Thank you very much. If we could shift over to cap structure and your refinancing negotiations, You mentioned you're kind of assessing multiple structures. I wonder if you could give us some more detail on kind of receptivity to those structures. Are you looking at any type of unique securitization of receivables within those negotiations? And kind of what are the big sticking points in financing negotiations? Speaker 200:27:04Yes. I think, Ben, let me just start with the fact that we are we've been working really hard as a company for multiple years to make sure that we're solid and operating well. And that's coming through in the conversation we're having about looking at the capital structure of the company and looking at different refinancing options. We're looking at all the different options that are on the table and we made good progress on all fronts. And we're pretty excited about where we stand with it. Speaker 200:27:29So I won't go too far into that, but I'll say that we wanted to make sure we exhausted all the different potential options for an organization like us and where we are relative to the industry. And so we're pretty excited about how that's progressing thus far. Operator00:27:46Thank you. One moment for next question. Our next question comes from the line of Pat McCan of NOBLE Capital Markets. Your line is now open. Speaker 500:27:59Hey, good morning and thanks for taking my questions. My first question is, I wanted to talk a little bit about the agency versus non agency, just particularly because of the whole lifetime value issue that comes up with agency business. So I was wondering if you could maybe give a little more details as to how you consider customer retention when it comes to negotiating agency versus non agency agreements with the health carriers? Speaker 200:28:33Pat, good to hear from you. Thanks for the question. This is a really important component to our strategy and has been for a number of years now, which is this dynamic of agency versus non agency contract structures. And as we've said from the beginning, we never expect nor would want to have 100% one way or the other. And it's a year by year decision as to how we think about the market landscape, how we think about the track record of the health plans and their benefit structures by product and population type. Speaker 200:29:09And so even given any one carrier you may have or health plan you might have 1 agency versus and 1 non agency contract. Some health plans we might do a more exhaustive pre and post enrollment relationship on an agency or non agency basis. So a lot of different structures that you might put in place. But as we think about the market dynamics on a year over year basis, as you think the pressures that are put in place, when you see market dynamics that health plans are trying to do land grabs and really grow fast and aggressively, you kind of start to think about what does that do on an LTV basis of the tenure of the consumer. A consumer coming into Merrick with a very high benefit plan will have a higher probability of benefit coming down versus going up over time. Speaker 200:29:53When you reset benefits and you bring the benefits down to a more stable systematic basis, you're going to have more upward opportunity or stability in those benefit plans. So as we think about trajectories, track records of products, we think about in that vein. You may actually be better off staying on an agency contract versus a non agency contract with certain carriers based upon those dynamics and where we feel those benefits stack up for consumers. And so as you think about where we were last year, there were some major players. For example, Aetna grabbed a lot of share last year. Speaker 200:30:27As you know, they were a big leader in the space. And based upon that structure, we had them on a non agency contract, right? And you can see that play through as being a very good astute view on where the market was, given that Aetna is making a big clawback on their benefits this year as they've said publicly. So we didn't have that tail risk on that business. And so we're able to continue to serve that population as appropriate. Speaker 200:30:51As we look into the coming year, we make decisions as to which plans will be in our marketplace and offer to our consumers based upon what we think is going to be best for them and their rankings, etcetera. So I guess what I'm coming down to is if I believe this AEP, right, as we think about different carriers and what they're doing and thinking about bringing the benefits down to a more stable level to drive their margins. When you write business in that environment, different from even today, when you write in the new AEP with the new benefits that we expect to come out, you should have higher confidence in those cohorts retaining potentially better than historically have. So that's how we're starting to think about it. But again, it's plan by plan and it's product by product and population by population, the way we've discussed those. Speaker 200:31:36With an emphasis on those health plans to allow us to really serve the consumer in a greater way post enrollment because that's where the real service comes on retention and long term satisfaction. Speaker 500:31:47Got it. That makes sense. And it sounds like the strategy has a lot to do with, of course, your expectations for the upcoming enrollment period, which sort of leads me to my next question, which was just around the financial projections. And with the idea that you would have revenue that is relatively flat with some modest margin expansion, I was wondering to what extent does that bake in some of the possible upswings from the upcoming period given the market dynamics? Or to what extent does it sort of conservatively not include considerations for a strong enrollment period upcoming? Speaker 200:32:48So let me just kind of take you to a couple of things we said in our prepared remarks. One is that when we gave you those qualitative statements for the full year, what was contemplated at that time was the fact that market dynamics we saw last AEP of lots of shopping with no reason for appropriate switching would continue until new benefits release. So that would mean that Q1 through Q3 should have been lower than last year because of the market dynamics that we're continuing going forward. And if you kind of do the math on that with us saying generally flat year over year, you would have seen an upward expectation on the back part of the new benefit plan market dynamics in Q4. Based upon our early reads right now, we're seeing that there are some tailwinds, we believe based upon what we've observed so far. Speaker 200:33:35We don't know to the extent that that will be there, but we do believe there are tailwinds on revenue, adjusted EBITDA and total submission counts, especially given the advancements we've also been making and the early results that we feel pretty good about on efficiencies on that direct cost per submission via our technology, etcetera. So the only switch, as we've said, is that we're starting to see that potential decline on agency versus non agency mix that could impact the cash flow from operations estimates versus last year. But that's really the way we think about it right now is that we do see that on those qualitative top line, bottom line items, we see some positive tailwinds from the market dynamics we're observing right now and expecting to come to say EP. Operator00:34:20Thank you. One moment for our next question. Our next question comes from the line of Jim Sidoti of Sidoti and Co. Your line is now open. Speaker 600:34:31Hi. Thanks for taking the questions. So if you do have that shift towards agency revenue, do you still expect to be cash flow positive this year? And how do you do that? Speaker 200:34:45I think it's too early for us to get too far into exactly the extent to which shifts will happen. These are the right ways that we think about setting up our contracts. Again, we design the contracts with our assessment of the product qualities and we think our extent to which we can serve the consumers the best. And then whatever those contracts are year over year, we have a distribution of agency versus non agency. And depending on which product matches best, we'll determine the extent to which that shift may happen between agency and non agency. Speaker 200:35:14So it's just it's too early to tell. I don't want to get you there. All I know is that it's likely not going to be the same distribution of non agency as we saw last year. And therefore, that would lead to a lower than what we experienced last year in cash flow from operations. But again, they're all for the right reasons. Speaker 200:35:29It's the right plan for the consumer and the way we as appropriately decided which contracts and or products that we prefer to be on agency versus non agency to deliver the greatest value for us as well, right, meaning on a revenue and adjusted EBITDA basis, risk adjusted from the way we think about it. So I know you're looking for more of a specific answer, but I just think it's a little too early for us to get too far into that till we know more about the details of the benefit distribution in a more precise way, which won't be evident until closer to October. Speaker 600:36:01All right. And then how are you doing with the use of AI to improve efficiency? Are there any how is that going so far? And do you expect that to continue to improve throughout the year? Speaker 200:36:19No, I love the question. It's one of the things that has been at the core of what we've been doing for the last couple of years when we talk about Plan FIT. And we really haven't described it in a way that I think the market really has had a chance to understand how unique it really is. When you take these 30,000,000 interactions that we've had and the live interactions we're having every day with consumers and feathering that into how to make the best recommendations for plans, We know, for instance, that when a plan fit checkup is done and our proprietary plan fit tool uses its logic and AI thinking to really estimate and rank the appropriate most suitable plans for the consumers that when we write one of the top plans, it has the highest retention, highest satisfaction for the consumers. So when we start to think again around the agency versus non agency model, regardless of what type of contract it is, we know that our tools have been designed now to be able to enable the agent to recommend a plan that has the highest probability of the highest tenure and retention value for that consumer because it's the most drives the most customer satisfaction. Speaker 200:37:27So that's one big place that we've been doing and continuing to develop to do it. We highlighted on the prepared remarks around what we've been doing on training, which is going to come through in significant efficiencies, this AEP. As we think about the onboarding speed, 40% improvements in that, getting to double the productivity that we saw last year, in early phases of the gestation of these agents with us. It's a really important component of how you can give live advance for agents to learn on the fly. And so they can do it on their schedule and we can do it on our appropriate timelines in different scenarios. Speaker 200:38:05So they're most prepared to serve this population. And given the amount of focus that health plans have been putting specifically on wanting to grow within special needs populations, that's where you need the most training to be great. It's what our agents do better than anyone else. It is their ability to anticipate the needs of special needs populations, the unique questions about how to access care and be able to resolve and build that trust on the phone. That is what is truly differentiating. Speaker 200:38:31And our AI tools have enabled us to do that with training. It's enabling us to do that with high value recommendations, so it drives highest retention. And we're continuing to use that information to figure out how to best anticipate the needs of the consumers and market to them directly and support that effort. Operator00:38:56Our next question comes from the line of Sandeep Soria of Delaware Street Capital. Your line is now open. Speaker 200:39:02Hi, this is Sandeep. Can you guys hear me okay? Yes. Good morning, Sandeep. Speaker 700:39:06Hi, good morning. Thanks for taking the question. First question was why did non agency revenue decline year over year given kind of the shifts and the repositioning of the business? And I have a couple of other questions, but I'm going to ask them one at a time. Speaker 200:39:20Yes. I think the question on non agency is one that's really determined on market dynamics. Like we said, there's one big piece, which is market dynamics of which products are most appropriate this year and what are the contracts that we have in place. The other piece that Katie highlighted was the dynamic around the change health care outage because there are a number of components of things that we need to do in the way we enroll a consumer to be eligible for non agency compensation with the different health plans. And due to some of the eligibility challenges we had due to the crowd or sorry, the change health care outage, it led us to needing to write some of those enrollments or those applications under an agency basis. Speaker 200:40:03So there was some shift for that alone. But generally speaking, it really is just a distribution of what consumers came in and which products best match for them. And we don't put our thumb on the scale to push it one way or the other. Really, the consumers' needs and who comes in determines what that split will be. And we are comfortable with those splits because we think those are the best value for us as well if those were to match for the consumers' needs. Speaker 700:40:30Got it. So the $7,000,000 impact that was highlighted earlier, that could have been more on the non agency side, but because of the change outage, it was a there was a complete shift to the commission part, commission revenue. Is that the right takeaway? Speaker 200:40:48I don't think it's all of it, but I'd say a good portion of it that's a fair set. Speaker 700:40:53Okay, got it. Great. Thanks. And then on the GPS agents, why did they go down? Why did that performance go down? Speaker 700:41:00And are those agents shifting to another or an FMO? Are they leaving the industry? Can you give us a little more color on what happened there? Speaker 200:41:10Yes. I mean, it's twofold. So 1, in any given year, you also always have well, let me take a step back and talk about strategic value of what the Go Partner Solutions or GPS is for us. It's a great way for us to get access to high quality variable capacity with no fixed cost expense for those periods of high volume in AEP, OEP, etcetera, and even through the SEC periods as well. So we think it's a unique differentiator for us to do that. Speaker 200:41:38We provide them tools. We provide them access to our relationships, insights, training, etcetera, to do that. And we've had many we have different agencies of different size that participate in our downline business. And some of them went out of business. They like we said before, they were trying to grow really fast and they didn't have the cash to really support it and they didn't have the continued access to capital to make the investments that they needed. Speaker 200:42:06And so some of them just went away. Some of them have decided to reprioritize where they want to grow and what they're going to offer and whether it's different to the extent of the volume they're going to devote to this type of this product. And therefore, you can see some differences there. Some will leave on their own and want to go do their own thing and that's great for them. It could be the right thing for them to do depending on what size they're at and that makes a lot of logical sense. Speaker 200:42:30But at the same time, we are also onboarding, right? And we've onboarded, let's call it, up to 10, maybe even more we might pull into the process by the time we're all done in this AEP and those will be significant contributors to our volume in that channel. But it's a normal cycle. You'll have ones that come in and go out. But I'll say over the last couple of years, we've seen more that shut down and shut their doors due to all the market dynamics that we've been seeing out there. Speaker 200:42:58Some are seeing more explicit at the largest scale of some of the players that are shutting it down and ours are more mid to smaller scale that are participating in our GTS external agent group. Speaker 700:43:09Got it. Great. Thanks. And then when I look at trailing 12 months submissions, I noticed that obviously the company went through a period of massive growth years ago and then it was negative growth as the business has stabilized, like very negative. And now it's starting to flatten on a trailing 12 month basis and I believe revenues are as well. Speaker 700:43:32How should we think about that? Is that the sign that like just I just wonder your thoughts when you look at the business on a trailing 12 month basis from a submissions perspective and then also from a revenue perspective? Speaker 200:43:45No, it's a great question. I really appreciate it, Cindy, because this is the when I say conviction to the business strategy, that's really important. Is that if I know everybody wants growth, but you've got to determine what the market allows to drive efficiency and prudence around cash deployment. You can drive your growth if you wanted to, if you want to burn a bunch of cash to go there and the market will determine how efficient you can be. And so as you think about the market dynamics we saw last AP on a TTM basis, you're getting a bunch of that, right? Speaker 200:44:16The market dynamics that we've already highlighted In any given marketplace, you can have 3 scenarios, right, of market dynamics between health plans. You can have a scenario where health plans are all being really aggressive and wanting to grow and that causes disruption and that's an efficient market for us to deploy cash and drive submission volumes, etcetera. The next option is that there's not a lot of investment in benefits. It's kind of a push. And if you care about doing what's only appropriate for the consumer, it's going to be a less efficient market for you, lots of window shopping, not a lot of appropriate switching. Speaker 200:44:45And then finally, you're going to have a market where there's a lot of negative disruption that brings a lot of shoppers in place and that's a very efficient market. So what you'd want to see from us is that when we see those dynamics that we've seen since last AEP and that will run through the Q3 of this year, that you want us to be prudent in the deployment of cash because it is not an efficient way to deploy cash to drive growth. You want to be thoughtful about saving that dry powder and being effective when you see the market dynamics coming as we're anticipating in Q4 of this year. But what you have been seeing is over that time, we've been investing in driving efficiencies so that when you do deploy that cash, you're not getting the diseconomies of scale. I think we have a lot of tailwinds around that given the fewer mouths to feed around lead volume because of industry compression of agents out there trying to sell this to our markets as seniors or Medicare consumers as well as our deployment of technology to drive efficiency on the operational side. Speaker 200:45:38Those two things are preparing us to have a pretty exciting and what we think AEP with lots of dynamism that really are positive for the GoHealth business model. Speaker 700:45:48Great. Thanks for that color. Last question for me is, how do you think about revenue from PlanFit, Check? And the secondary follow-up question to PlanFit in the quarter was, I saw that submissions were down about 6%, but PlanFit was I think you said $125,000 I can't remember. So should I be thinking, oh, if I add submissions to PlanFit, that gives me an idea of the number of engagements that you guys did in the quarter. Speaker 700:46:24Walk me through how I should think about both the revenue opportunity for plant fit and then how I should think about submissions in plant fit as a metric, so I can better understand the underlying business? Speaker 200:46:36Yes. So as you think about this is and I'm going to try to keep this as organized as possible. But the way you're thinking about it is right. So we have an X number of submissions or let me kind of take you to the top of funnel. We have a number of consumers that reach out to us who need support in the shopping experience. Speaker 200:46:53Of those, we're able to take them through a full plan fit checkup, right? And that experience can result in those three outcomes that I described before, either we enroll them a new product that's better for them, we tell them another product is better for them, but they choose they don't want to do anything, or you go all the way to the end and we tell them, hey, you're on the right process. And of that total process, you would take the total submission plus the number ones that we just gave peace of mind, add them together, and that's the ones that would be generally available, call it, I think, with 230,000 or so. We talk about what we did in our internal agent pool this last quarter. And so you would say of those, which one then you have a distribution of how many get enrolled and then how many would be eligible potentially for a plan fit today because you got to get them through the whole process. Speaker 200:47:35Do a full checkup to get eligible for a plan fit today. And then it varies by health plan from there. But the way I think about our business plan, our business plan is to take the top of funnel all the way through anybody who's outreach to us, how do we get as many of those interactions to add value to the consumer and then be able to generate revenue for us for doing that work. But staying true to do right for the consumer and find ways to make it work for everybody. So what's beautiful about PlanFitSave is that when we do that work, we're providing peace of mind to the consumer. Speaker 200:48:05We're providing really low cost to no cost retention services for health plans who invest 1,000,000 of dollars every year trying to figure out how to engage with that population and keep them retained and satisfied. And we're also able to reorient that consumer so that they can really get the maximum value out of those benefits that made them shopping in the 1st place. They don't remember what the benefits were. They weren't understanding how to utilize them. We can reorient them at that time. Speaker 200:48:31And now we're having the ability to start to get compensated for that work. And that is what you can expect from us. Do the right thing, prove that everybody wins from it and then find a way to ensure that we are getting revenue or compensated for that work that we're doing in a very symbiotic way. And so the way to think about it. I think at top of funnel, all those interactions, we're continuously working to find more and more of that that is going to be able to be compensated for hard work we do. Speaker 200:49:00Most of the industry driving it just conversion, conversion, conversion, convert to a new enrollment. That's the only thing that triggered compensation in the past. And now we're finding ways from just doing the right thing, we're starting to get compensated for that as well in addition to appropriately enrolling, all doing what's right for the consumer and right for the health plan. So that's what's really exciting about where we're going, what Plan Fit Safe is opening up. And we're making great progress and have really good demand from the health plan to jump on board to this added element of the reorientation on top of a typical plan to check up to reengage the consumer with those health plans. Operator00:49:38Thank you. This concludes the question and answer session. I'd now like to turn it back to Vijay Kote for closing remarks. Speaker 200:49:44Thank you all for your attention and participation in today's call. We are very excited about what is there to come. Our team has been working diligently to prepare not just for this annual enrollment period, but where we're anticipating the needs of the population and the overall Medicare landscape to be for years to come. What you learned if you've been around this business for a while, it's not just a seasonal business, it's a cyclical business. And you need to make investments and prepare for all of that. Speaker 200:50:12And we made those investments in plan fit checkups last year and you're seeing the value of that with plan fit saves as we anticipated the need for health plans to really focus on retention as well as targeted growth. Our tools, our team, our commitment to the consumer is what differentiates us and enables us to be more predictable in these types of changing environments. We stabilize what seems to be a volatile market and that's exciting I think for us, for our consumers, for our team and for our shareholders. So thank you for your time and your continued interest in our organization. Operator00:50:46Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.Read morePowered by