Good morning, everyone, and welcome to eHealth, Inc.’s Conference Call to discuss the company's First Quarter 2023 Financial Results. At this time, all participants have been placed in a listen-only mode. The floor will be open for your questions following the presentation. It is my pleasure to turn the floor over to Eli Newbrun-Mintz, Senior Investor Relations Manager. Please go ahead.

Good morning and thank you all for joining us today. On the call this morning, Fran Soistman, eHealth's Chief Executive Officer and John Stelben, Chief Financial Officer will discuss our first quarter 2023 financial results. Following these prepared remarks, we will open the line for a Q&A session with industry analysts. As a reminder, this call is being recorded and webcast from the Investor Relations section of our website. A replay of the call will be available on our website later today. Today's press release, our historical financial news releases, and our filings with the SEC are also available on our Investor Relations website. We will be making forward-looking statements on this call about certain matters that are based upon management's current beliefs and expectations relating to future events impacting the company and our future financial or operating performance. Forward-looking statements on this call represent eHealth's views as of today, and actual results could differ materially. We undertake no obligation to publicly address or update any forward-looking statements in future filings or communications regarding our business or results. The forward-looking statements we will be making during this call are subject to a number of uncertainties and risks, including, but not limited to, those described in today's press release, and in our most recent Annual Report on Form 10-K and our subsequent filings with the SEC. We will also be discussing certain non-GAAP financial measures on this call. Management's definitions of these non-GAAP measures and reconciliations to the most directly comparable GAAP financial measures are included in today's press release. With that, I'll turn the call over to Fran Soistman.

Thank you, Eli, and thank you for joining us this morning for our first quarter 2023 earnings call. On this call, we will discuss the latest industry developments, review our first quarter results, and highlight key operational and strategic initiatives underway. I would also like to mention that we will be holding an Analyst and Investor Day next Thursday, May 18. At this event, you'll hear from our extended leadership team and gain further insights into eHealth’s strategy, operational goals, and key financial metrics based on our three-year financial outlook. We look forward to you joining us on this notable day for eHealth. We delivered a strong first quarter performance demonstrating the positive impact of a transformation plan we began to implement in Q2 of 2022. We entered the first quarter this year on a significantly improved cost foundation compared to Q1 a year ago while continuing to improve our telesales conversions, member economics, and enrollment quality. During the quarter, we rolled out Phase II of our business transformation across key functional areas of the company. This includes expansion of our direct marketing channels and brand building efforts, initiatives to drive further productivity gains in our telesales organization, a comprehensive member retention program, and technology projects aimed at taking our omnichannel capabilities to the next level. We are also gaining traction and executing on our business diversification strategy as we prepare for the launch of a major carrier-dedicated deal later this year. I'll talk more about these initiatives in just a few minutes, but first, let me take a step back and remind you of our mission and differentiated value proposition. eHealth's mission is to expertly guide consumers through their health insurance options when, where, and how they prefer. Our value proposition is rooted in our customer-centric marketplace that provides beneficiaries with data-powered tools and access to our full-time licensed benefit advisors to help them find health insurance that best fits their needs. We are also differentiated through our extensive carrier-agnostic business model. A critical component of eHealth's business success depends on assisting beneficiaries through the shop, educate, advise, and enroll process. Our overarching goal is to match the beneficiary with a plan that best meets their financial, health, and lifestyle needs regardless of which carrier is offering that particular plan. eHealth also provides the consumer with a range of enrollment methods that fit their preferences. Customers can enroll in plans through our self-serve online platform supported by chat or co-browsing capabilities should they want professional help. Or they can complete their enrollment on the phone with one of our licensed and trained benefit advisors guiding them from start to finish. Again, our goal is to meet the customers where they are and do everything we can to simplify their journey through the often confusing process of selecting health coverage. We remain bullish on the unique strengths of the Medicare Advantage market and our growth opportunity within it. Medicare Advantage has favorable demographic trends, bipartisan legislative support, and, compared to traditional Medicare, it offers a significant value proposition and produces superior health outcomes. Because of these anchors, we are confident that this market will continue to be a key driver of our success. Throughout the past several months, we have closely observed a number of regulatory developments that took place in our sector, including CMS' issuance of new Medicare Advantage and Part D prescription rules, as well as the final 2024 Medicare Advantage rates. While rate changes were ultimately more favorable than contemplated by the advanced notice, we anticipate that the slowdown in reimbursement rate growth, combined with recent fluctuations in star ratings, will likely lead to shifts in carrier competitive dynamics during the upcoming AEP. Importantly, the impact will vary by state and county. We believe eHealth's carrier-agnostic model, local market focus, and ability to offer a broad selection of plans sourced from large national carriers as well as smaller regional carriers will be key for delivering strong performance in this evolving environment while providing the best value to beneficiaries. Our emphasis on fostering member loyalty and retention, regardless of whether the beneficiary stays on the same policy or uses our platform to find a new one, is an important part of succeeding in this market. Regarding the 2024 MA and Part D prescription rules, we believe they are generally in line with the recent trends towards greater emphasis by regulators and carriers on the beneficiary experience and enrollment quality. This includes increased scrutiny over marketing materials and sales practices for Medicare products. Most rules are aligned with our own goals as we support rigorous protections for the customers we serve. Ultimately, we expect these rules and the corresponding operating adjustments to move the industry even further towards rationalization of marketing activities, which we started to observe last AEP. We are still working with carriers and CMS to clarify some of the provisions of the rules; however, it's important to note that we began planning changes to our seller sales and marketing processes starting when the proposed rules were first released in December of last year. While we do have some concerns that these rules could create additional complexities and new inconveniences for beneficiaries in the near term, we continue to believe that our omnichannel platform offers significant value compared to other distribution channels in making the process of selecting and enrolling into Medicare coverage as seamless as possible. We believe this will be especially true under the new regulations. For example, our concierge-like model for telephonic and online assistant enrollments can effectively accommodate appointment setting if needed. In fact, a large share of our telesales enrollments at the beginning of each AEP are typically driven by appointments. Further, we expect eHealth to have access to physical locations where customer walk-ins can be accommodated through a combination of technology and agent support. For customers who don't require agent assistance and prefer to do their own research, we are unique in our choice model offering that includes end-to-end self-service online enrollment. Finally, we plan to continue to grow our carrier-dedicated arrangements and are prepared to fulfill that demand in a fully compliant way and within the guidelines set by each carrier. After we receive clarity on the provisions of the rules that we still have some questions about, we plan to move rapidly to implement any required changes well ahead of the AEP when the rules take effect. The bottom line is that we remain confident in the attractive MA market opportunity and our ability to serve customers in this market. Moving now to our financial and operating results. Our first quarter revenue and enrollment volumes are generally in line with our expectations. At the same time, we've delivered better than expected earnings driven by two factors: one, a positive impact from cost elimination and reduction efforts; and two, a meaningful improvement in our telephonic conversion rates, which for the first quarter, increased 21% year-over-year. The quality of our enrollment also continued to improve as reflected in stable earning data related to our member retention during the critical AEP, the OEP shopping cycle as well as improvement in CTM scores. As a reminder, CTM stands for Medicare Complaint Tracking Module and reflects beneficiary complaints filed directly with CMS. eHealth observed another 50% year-over-year decrease in its CTM rates from Q1 2022 to Q1 of 2023. Based on data available to date, many of our key carrier partners have recognized this important service improvement. First quarter revenue was $73.7 million, a 30% year-over-year decline reflecting the optimization of our variable marketing expenses and agent headcount to drive stronger LTV to CAC ratios compared to the first quarter a year ago. At the same time, our GAAP net loss and adjusted EBITDA improved substantially on a year-over-year basis by approximately $13 million and $12 million respectively. Our cash flow from operations increased 29% compared to Q1 of 2022, driven in part by the improvement in net loss compared to a year ago and better than expected renewal cash payments on our existing members, both of which are encouraging outcomes. We ended the quarter with $203 million in cash, cash equivalents, and marketable securities, more than sufficient to execute our operational plans through 2023 and beyond. We will share more about our cash flow expectations for 2024 and 2025 at our upcoming Analyst and Investor Day on the 18th of this month. Now turning to our operational and strategic initiatives underway. As a reminder, on our last earnings call we laid out four operational priorities for 2023. First, to continue to build on last year's progress with eHealth’s omnichannel marketing and lead generation engine. Second, to improve conversion rates across our entire enrollment platform, regardless of how the customer chooses to interact with eHealth. Third, to introduce the next phase of our customer retention strategy. And finally, to further diversify eHealth's revenue streams. This year we plan to return to enrollment growth driven by a demand generation strategy that focuses on audience segmentation and targeting, differentiated messaging, and gradual scaling of our direct and strategic partner and marketing channels as we reduce our reliance on lead aggregators. During the quarter, we also launched the first phase of our branded content strategy. We're currently market testing our materials with scale deployment of these materials planned for the AEP. We also started building targeted campaigns aimed at distinct Medicare audiences including new to Medicare members, MedSup, etc., in recognition of varying needs, interests, and preferences. Essential to our marketing strategy is maintaining agility, which allows us to opportunistically lean into channels that are yielding quality leads at attractive LTV to CAC ratios. At the same time, we are prepared to pull back on marketing spending at any time and drop savings to the bottom line should we not see sufficient opportunities that satisfy our target enrollment margin. Online conversions remain a major focus for the company this year. We achieved significant improvement in telephonic conversions over the past six months and are planning to replicate this success online. Every year millions of prospective customers come to our online marketplace to learn more about the Medicare program, research coverage available in their county, and compare plan options. Even a modest increase in visits that result in submitted applications would be a meaningful financial lever given the large size of our online audience. Last year, we introduced new omnichannel tools including online chat and agent co-browsing features on our eCommerce platform and are now working on additional ways to make our marketplace experience even more convenient and navigational. This includes a planned release of video chat with our licensed agents, enhancements to our mobile platform which is growing in share of total site visits relative to desktop, as well as improving targeted user experience at key points of our online funnel. Our product team is also closely collaborating with the marketing organization to provide customized online experiences in support of audience-centric campaigns as well as our major strategic partnerships. Driving increased member retention is a key element of our three-year strategy in our 2023 operating plan. Achieving meaningful retention improvements requires close alignment and collaboration between our marketing, telesales, and technology teams. We believe that relationship building starts from the very first touch with a customer, continues throughout their entire experience on our platform, and carries on long after we complete the enrollment. Our next stage of retention activities is built on the same concept as our new marketing strategy, which focuses on a personalized one-size-does-not-fit-all approach. We are building customer relationships on a local market basis and tailoring outreach based on our predictive models that identify members that are at risk for churn. Still further, we plan to expand the scope of our post-enrollment engagement services that are proven to both improve member experience and drive stronger retention. On the revenue diversification side, we are making progress in building out our dedicated carrier arrangements that are typically characterized by favorable cash flow timing compared to our core business and allow us to generate revenue without deploying our own marketing resources. As we shared on our last earnings call, earlier this year we won an IFP with one of our major carrier partners that will be supported internally by a team of dedicated eHealth agents. In Q1, we started ramping our benefit advisory resources in support of this revenue model. Within our individual family and small business segment, we continue to see a positive LTV trend as average duration of these plans continues to increase. We also observe strong renewal activity with our small business groups. With respect to the IFP macro environment, we expect the Medicaid redetermination cycle related to the Federal government's ending of the COVID-19 emergency to serve as a potential driver of incremental IFP enrollments and have incorporated that trend into our 2023 guidance. It is estimated that around 15 million Medicaid and SHIP members will be disenrolled between April of 2023 and May of 2024, and a subset of that group is expected to be eligible for zero or low premium IFP plans based on their incomes. We believe our rich history and deep expertise in the IFP market uniquely positions us to help these individuals navigate their coverage options. Based on our encouraging first quarter results, we are reaffirming the guidance ranges we provided on last quarter's earnings call. Our year-to-date performance puts us in a strong position as we continue to execute our strategic and operational goals. At the same time, it's important to recognize that we expect to generate all of our projected 2023 positive adjusted EBITDA during the fourth quarter. The vast majority of our year-over-year revenue growth projected for 2023 is also forecasted to occur in Q4. So while we are pleased with our first quarter performance, we also acknowledge the important work ahead of us to achieve our 2023 plan. Following our seasonally strongest cash collection quarter, we remain confident in our ability to strengthen our balance sheet through continued execution. Lastly, through the strong performance of our Human Resources Organization and department leaders throughout the business, eHealth continues to progress towards creating a best-in-class corporate culture. Through a host of enrichment programs, benefits, and communication initiatives we have significantly improved employee engagement, which in turn is driving strong performance across the organization. We look forward to hosting you in person and digitally during our upcoming Analyst and Investor Day on May 18th. eHealth’s leadership team is excited about the current trajectory of the business and I personally look forward to showcasing this strong team that we've assembled. I will now turn the call over to our CFO, John Stelben. John?

Thank you, Fran and good morning. Our first quarter results reflect the impact of the business transformation plan implemented in April of last year, with continued efficiency gains in our marketing and telesales organization, coupled with strong cash collections on our existing book of business. A combination of these factors provides for a strong start to the year and ample liquidity to execute on our operating plan. On a consolidated basis, first quarter revenue of $73.7 million was down 30% year-over-year. Recall that we discussed this in our Q4 earnings call as eHealth’s transformation plan emphasized prudent and profitable growth over revenue growth at any cost. Net loss for the quarter was $19.9 million, an improvement compared to the net loss of $32.7 million in Q1 of 2022. Adjusted EBITDA was negative $12.7 million, compared to the negative $24.8 million in Q1 of 2022. Our profitability improvements in the quarter are further proof that our business transformation efforts are firmly taking hold. First quarter Medicare segment revenue was $61.8 million, a decline of 35% compared to a year ago, driven primarily by a lower number of approved Medicare members from the aforementioned transformation efforts. During the quarter, we operated with leaner and more efficient agent staffing and marketing spend, resulting in lower enrollments. At the same time, our member economics improved substantially on a year-over-year basis, with total acquisition costs per approved Medicare member of $771, a decline of 22% compared to Q1 of 2022. Total Medicare approved applications were just under 69,000, including 60,451 Medicare Advantage approved applications, a 28% decline compared to Q1 of 2022. 16% of our Medicare Advantage applications were submitted through our online unassisted channel, and the combination of online assisted and online unassisted represented 54% of submitted Medicare Advantage applications, reflecting continuing adoption of our omnichannel enrollment platform by beneficiaries. Medicare Advantage LTVs were down 5% compared to Q1 a year ago in line with our expectations. Our LTV model is based on a three-year look back, which means that for estimating the persistency of our 2023 cohorts, we've replaced observations from 2019 with 2022 data. Our 2019 cohort had higher retention than subsequent cohorts, so removing it from the model results in lower LTV estimates. Combined with product and carrier mix, this was the main driver for the year-over-year decline in MA LTVs. We expect roughly flat LTVs for the full year 2023 compared to 2022. As it relates to the cohorts enrolled during Q4 2022 AEP, we don't yet have the full view of the impact from plan switching, which took place during the first quarter open enrollment period. However, our initial observations for the MA cohort have so far pointed to a slightly favorable trend relative to the cohorts from 2020 and 2021 AEPs. We expect to get a more complete view on that cohort’s performance over the next few weeks. Per unit gross margin for our Medicare Advantage plan was $130 versus a negative $38 in the first quarter a year ago. As a reminder, our unit margins have a seasonal pattern, with most profitable enrollments typically generated during the fourth quarter, which is characterized by the highest volumes and lead conversion rates in the year. Third quarter enrollments have the lowest gross margin of the year as we start to ramp our operating expenses ahead of the AEP and spread them over the seasonally lower enrollment volume. First quarter 2023 Medicare non-commissioned revenue, comprised primarily of carrier advertising revenue, was $5.2 million compared to $10.7 million in Q1 of 2022. The magnitude of the decline in non-commissioned revenue was caused by the timing of a large carrier advertising payment that came in the first quarter of 2022, as well as our recent pullback on Medicare marketing, as we focused on cost restructuring and improved operational efficiencies. Medicare segment loss in the first quarter was $3.4 million, an improvement compared to a loss of $14.8 million a year ago. This was driven primarily by impacts from our transformation initiatives, which began in the second quarter of 2022, including higher unit margins but offset by lower volume. Moving now to our individual, family, small business, and ancillary product segment. First quarter segment revenue was $11.9 million, up 17% from Q1 2022. IFP SMB segment profit was $7.4 million, an increase of 41%. Stronger revenue and profitability were partially driven by revenue timing caused by a lag in approved applications, combined with slightly higher IFP enrollment volume during this period, as compared to a year ago. This segment also benefited from strong renewal revenue from our small business group product. Non-GAAP fixed costs, which include our check-in and general and administrative costs, decreased by $2.5 million or 7% in Q1 compared to the first quarter of 2022, driven by headcount and vendor cost reductions. We tightly manage and review these expenses each month with senior leadership to ensure we are maximizing value and spending in line with our 2023 goals and longer-term strategic objectives. First quarter non-GAAP customer care and enrollment costs of $26.4 million decreased 37% year-over-year, while non-GAAP marketing and advertising of $32.4 million decreased 44% compared to Q1 2022, again, due to the business transformation efforts implemented. Our total first quarter non-GAAP operating expense, which excludes stock-based compensation and restructuring charges, was $91.6 million, a reduction of 32% compared to Q1 of 2022. Operating cash flow for the first quarter was $60.8 million, a 29% improvement compared to $47.1 million in Q1 2022. The stronger than expected cash collections during the quarter were driven in part by renewal members within specific carrier cohorts as well as higher renewal commission rates. At the same time, initial cash payments on new enrollments declined year-over-year, as expected, primarily as a result of lower Medicare enrollment volumes during the most recent AEP and OEP, as compared to the same enrollment periods a year ago. As a reminder, we don't receive the majority of initial cash payments resulting from fourth quarter AEP enrollments until Q1. Ending cash, cash equivalents and marketable securities balance was $202.7 million at quarter-end, up from $144.4 million as of December 31, 2022. Our balance sheet also reflects $205.7 million in short-term commission receivables expected to be collected over the next 12 months and $596.4 million in long-term commission receivables. We believe we have sufficient cash to execute on our operating plan this year and bridges to future positive cash flow. I will discuss our financial goals for the next three years, including the timeline to positive cash flow generation at the upcoming Analyst Day next week. Looking ahead, we are reaffirming the fiscal 2023 guidance ranges we provided at our fourth quarter earnings call.

Your first question comes from George Sutton from Craig-Hallum. Your line is now open.

Thank you. Very nice job on your Medicare Advantage cost to acquire per member. So I had a two-part question relative to the new CMS rules, particularly the 48-hour rule. And you did mention first that you were looking at ways to access physical locations, so I wondered if you can go into more detail on that? And second, you in a couple of years past had a confirmation call at the end of the transaction. I'm just curious, would this just simply be rather than an immediate confirmation call, a call that is set up in 48 hours? Thanks.

Good morning, George. It is Fran. Thank you for the questions. Let me address them in the order that you raised them. The 48-hour rule was really a catalyst to accelerate what we had been planning for all along and that was how can we add additional dimensions to our strategic partner relationships. And so what I can't get into too much detail because it is premature, but I can confirm that we are exploring multiple alternatives to be more in touch with or more aligned with the local nature of health care. We even made modifications to our telesales operating structure last year. We're going to be expanding that pretty extensively for this upcoming AEP again, getting closer to the local market because healthcare is local. So with respect to our strategic partners, I think we'll be in a place to provide a little more color as we report out Q2, but I will reinforce that we are looking at multiple opportunities there. As far as the second question, when this rule first became public in draft form and sought comments, that was really our call to action in terms of scenario planning, and we looked at multiple possible outcomes. On our telesales side, we already have a pretty robust capability for appointment scheduling. In fact, we always start the AEPs now, using the marketing period as an opportunity to schedule appointments that go live on October 15th to start with AEP. But we're going to be expanding that capability so that the scheduling technology is even more robust. Essentially, as you characterized it, I would say that that's one way of doing it. We will use AI where we can, so that we could notify people of their appointments through emails and texts. We want to be very smart, efficient, and customer-centric in how we approach this because people like to communicate in different forms, not always by phone or by text and email. So that's how we're thinking about it right now, George.

Can I just ask one follow-up there, does that mean like October 13th, you could have conversations and then schedule the follow-up for the 15th and be aligned with the rule?

It's our understanding that that marketing period is for just that marketing. And we can utilize that period to begin the scheduling process. There's still, we expect further clarifications from CMS. We've heard that from multiple sources of how they're thinking about things. But as far as interpretation of the marketing guidelines that we would do that, we've done it in the past in terms of appointment setting; we just can't begin the sales process until the official start of AEP, which is October 15th.

Appreciate the clarity. Thanks, guys.

Thank you. And your next question comes from the line of Daniel Grosslight from Citi. Your line is now open.

Hey, congrats on the quarter. This is Luis on for Daniel. I just wanted to follow up a little bit on the 48-hour rule as well. Would you detail what percentage of your calls are inbound versus outbound during AEP? And what proportion of that business is done in the last 48 hours?

Good morning, Daniel. Thanks for the question. I think it's fair to say that virtually 100% or thereabouts are inbound calls, meaning when we do an outbound it's usually to follow up. So we don't do what I would call proactive outbound calls. It's usually we do callbacks that's obviously an outbound. But we are almost entirely inbound-oriented on our telesales side. But let me remind you, though, that we have a multi-dimensional omnichannel distribution capability, right? So we have our online platform, which is both unassisted and assisted. So we will rely on that for meaningful contributions to our growth activities. We actually think the 48-hour rule could be a catalyst for accelerating volumes as a platform.

Gotcha. That's helpful. And other pertinent questions, would you be able to detail what percent of your business happens in the last 48 hours into AEP season?

Oh, okay. I would say that we will give you a percentage, but it's meaningful, it's important, so it’s not the last 48 hours, think about the rule as it's constructed today provides for no 48-hour requirement for the last four days. The last week of AEP is an important period of time; I'm not going to understate that towards achieving our AEP goals.

Gotcha. Thank you, very helpful.

Thank you. Your next question comes from George Hill from Deutsche Bank. You may proceed.

Yeah, hi. It's actually Maxine for George. Thanks for taking the question. We've been hearing a lot of plan sponsors talking about investing more in their own brokerage capability and internal sales channel. Can you give us some color on the impact you're currently seeing and how do we prepare to deal with it? Thank you.

Good morning, Maxine. Thanks for your question. There's been a lot of talk about this and we've read reports as well, but it doesn't reconcile with our relationship with our carrier partners. From personal experience, when I was on the carrier side, we did put an importance on having proprietary capabilities, but it had to be balanced because it becomes a fixed cost. You can only really rationalize so much fixed costs when you've got a concentrated selling period of about eight weeks each year, where a vast majority of your volume comes in. And so I think that there are multiple ways that carriers are thinking about this, including working with us and the dedicated carrier relationships. So it can be called dedicated, it becomes proprietary, but it's outsourced. So I think there's details missing in what's been conveyed. And I'm sure that carriers will share more details at the appropriate time, but we're not seeing any change in our relationships other than they're getting stronger because we've demonstrated that we can perform quality growth activities and do it in a way that enhances customer satisfaction through a reduction in the CTM volumes. So we are earning the trust and confidence of our carrier partners.

Thank you. There are no further questions at this time. Please proceed.

Thank you all very much.

Thank you. That does conclude our conference for today. Thank you all for participating. You may now disconnect.