Benefitfocus, Inc.

Greetings, ladies and gentlemen, and welcome to BenefitFocus third quarter 2021 earnings conference call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. Should anyone require operator assistance, please press star zero on your telephone keypad. It is now my pleasure to introduce your host, Ms. Patti Leahy. Thank you. You may begin.

Thank you, operator. Good afternoon and welcome to BenefitFocus's third quarter 2021 earnings call. Joining me today are Matt Levin, President and Chief Executive Officer, and Alpana Wegner, Chief Financial Officer. Matt and Alpana will offer some prepared remarks, and then we'll open up the call for questions. Before we begin, let me remind you that today's discussion will include forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from those statements, including integration and reliance on key personnel, impacts of COVID-19, and the development of our market and business, including our growth strategy. For more information, please refer to risk factors discussed in our most recent Form 10-K filed with the SEC. During today's call, we will also refer to certain non-GAAP financial measures. You can find important disclosures about those measures in today's earnings press release. I'd also like to make note of a couple upcoming investor events. We'll be participating next week in the Credit Suisse Virtual Healthcare Conference, and later in the quarter, we'll also be virtual at the Piper Sandler Healthcare Conference. We're looking forward to these events and hope to interact with many of you then. Further information about these events will be available on our investor relations webpage. With that, I'll now turn the call over to Matt.

Thank you, Patty. Good afternoon and thank you for joining us. Let me start by sharing three objectives we have for today's call. First, I'll provide a preview of the growth strategy the team and I are working on, which you'll hear a lot more about early next year. Second, we'll recap some of the actions we've taken to strengthen our foundation and return the company to growth. And third, we delivered a solid quarter which Elpana will cover in detail along with our outlook for the remainder of the year. Let's begin with a preview of our growth strategy. The team and I are actively working through the details of our growth opportunities and overall plan. We intend to share more on our plan starting with our next call. For today, it's important you know that we have a methodology we are acting on to drive operational excellence and improve performance. I expect this discipline, coupled with the experience and sense of urgency our leadership team brings to return the company to sustainable growth. Of course, all good strategies start with a compelling mission. Our mission at BenefitFocus is to improve lives with benefits. This is an enduring mission and serves as our guiding light as we think about the job to be done for our customers. This mission has taken on an increased level of importance in light of how the pandemic has impacted all of us over the past 18 months. I, along with all of our associates, take our responsibilities very seriously, and it's on our minds every day. Our mission is underpinned by core values. Our values were tested and refined about three years ago with collective input from our associates. I'll highlight a couple of them for you today. First, anticipate. This means we strive to anticipate the needs of our customers by actively listening to their changing needs and challenges and responding with the right products and services. If you listened to our last call, you know that I believe service excellence is the single biggest driver that can return the company to growth. I can't state this enough. The ability for our team to anticipate and deliver on the needs of our customers is paramount. It is equally important that our customers know we are a safe set of hands as they and their employees or members navigate a constantly evolving healthcare landscape. I feel good about the progress we're making and believe we have the right people focused on what needs to get done. Another value I'll highlight is own-it's. It's the value that encompasses accountability. I believe driving a performance-based culture that includes a high say-do ratio goes hand in hand with delivering improved results. It starts with me and the executive team and cascades from there. We have also defined aspirations for each of our key stakeholders, including associates, customers, partners, and shareholders. For the avoidance of doubt, our aspiration for our shareholders is to maximize shareholder value by driving robust, sustained growth. I've said it before, this is the reason the board hired me and is the main needle we are focused on moving. As I look ahead, I see two primary levers which drive our growth strategy, enrollment and engagement. These will be familiar to you if you've been listening to our calls over the past few quarters. They were chosen because they clearly connect to our core competencies and our areas where we believe we can create disproportionate value for our stakeholders. What's different than what you may have heard before is the heightened focus, experience, and sense of urgency this leadership team brings in our commitment to execution. Drilling down into both, our enrollment strategy encompasses advancing and modernizing our enrollment platform with the objective to grow our customer base. This is table stakes. And by offering a best-in-class enrollment experience, we will drive better customer retention and increase the number of customer references, which is the fastest path to growing our customer base. Our enrollment strategy also includes rounding out a few areas of our current product portfolio. One example is in administrative services and compliance, which, done well, is a way for us to reduce the administrative burden on our customers, allowing them to focus on higher level strategic priorities. It also gives us brand permission to have discussions around other adjacencies that we're excited about, particularly in the area of engagement. Engagement is the way we interact with customers beyond enrollment by activating the lives on our platform through areas such as health advocacy, navigation, and emerging categories of voluntary benefits, we see paths to drive additional revenue growth and believe we can accomplish this organically through partnerships or via acquisition. Data is a key enabler for both strategies. We view our data assets as a competitive advantage and believe that delivering industry-leading data exchange and insights is a critical part of our enrollment and engagement strategies. Leveraging our data assets help our customers and their employees select and better utilize the right benefits, and in the process, drive down healthcare costs for everyone involved. In addition, given the richness of our data sets, ranging from claims to enrollment decisions, we believe we have the opportunity to be increasingly valuable partners throughout the ecosystem, particularly with brokers and consultants, to help them better serve our joint customers. Underneath these strategic growth levers are specific drivers connected to our focus on the customer experience, service excellence, and operational efficiencies, among others. You can hold us accountable for sharing these growth drivers in more detail, along with our key performance metrics at our next Investor Day. I hope this gives you a sense for the strategic framework we are using to drive operational execution and improve performance. I believe our team can be successful executing on this framework, in part because of the groundwork that has already been laid. And this leadership team has been here before. So I'll turn to the second objective for today's call, which is to briefly recap some of the actions we have taken to build on the foundation the team has put in place. Over the past six to 12 months, we have strengthened our talent base, enhanced our governance, and begun modernizing our platforms. We've also been opportunistic with the repurchase of debt, resulting in healthier leverage while preserving our financial flexibility. Alpana will discuss our debt repurchase in more detail in a moment, and I'll provide more color on the governance, people, and platform actions we've taken. From a governance perspective, we've substantially enhanced the diversity, independence, and experience of our board. Most recently, we added a wealth of health plan experience with the addition of Brad Wilson, former president and CEO of Blue Cross Blue Shield of North Carolina. We have also improved shareholder rights, including the approval by shareholders at our last annual meeting of our proposal to declassify the board. From a people perspective, as I said on the last call, building a world-class company starts with building a world-class team. I believe we have done just that, attracting some of the best experts and leaders in our industry. We are focused on improving service quality for our customers and are creating a dynamic culture defined by inclusiveness, meritocracy, and delivering results. We have also continued to modernize our product development processes and improve the performance of our platform. We're in the early days of executing this plan, but are excited about the benefits we expect for our customers, including service improvements and faster delivery of new products. That brings us to the current state of affairs, which I'll cover briefly before handing off to Alpana. As I mentioned before, our top priority is to drive growth. This starts with service excellence. We are currently at the height of open enrollment, a period that puts our service capabilities to the ultimate test. We've invested in enhancing the open enrollment experience for our customers this year, and I'm pleased to share that it's going well so far. Early feedback from customers, including some of our largest, has been positive. We also continue to get encouraging feedback regarding the user experience. I am pleased with our progress and believe this is a good sign that the trends are improving. The payoff with delivering an outstanding open enrollment this year should lead to more references and more exposure to more opportunities next year, which translates to long-term revenue growth. We have also doubled down on our outreach to partners in the overall ecosystem, including brokers, consultants, and advisors. This has included transparent and honest discussions around our efforts around service excellence and product roadmaps, as well as commitments to eliminate friction with these influencers. I have been personally involved in many of these discussions. Here, too, I am encouraged by the feedback we have received and feel the trajectory is positive. In summary, we are building upon our 21-year history of product innovation and service excellence, but to be clear, it's a new day of benefit focus. That's a good segue to hand it over to Alpana, who will dive deeper into our results and outlook in more detail.