GoHealth, Inc.

Good morning, and welcome to Go Health's first quarter 2025 earnings conference call. My name is Tanya, 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. I would now like to turn the call over to John Shade, Vice President of Investor Relations. John, you may begin.

Thank you, and good morning. Welcome to Go Health's first quarter 2025 results call. Joining me today are Vijay Kote, Chief Executive Officer, and Brendan Chanahan, 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. Many 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 first quarter of 2025. We have posted the release on the Go Health website under the Investor Relations tab. In the press release, we have listed certain risk factors that you should consider in conjunction with our forward-looking statements. We encourage you to consider the other risk factors described in our 10 and 10 reports filed with the SEC for additional information. During this call, we will be discussing certain non-GAAP financial measures. These measures are reconciled to the most directly comparable GAAP financial measure in our press release. You may also refer to the investor relations presentation posted to the investor relations section of our website for reconciliations of non-GAAP measures to the most comparable gap measures discussed during this earnings call. I will now turn the call over to Go Health CEO, Vijay Kottai.

Thank you, John, and thank you all for joining us today. Our performance during Q1's open enrollment period exceeded our expectations for submissions, revenue, and adjusted EBITDA. For those new to the Go Health story, our mission is to provide support, clarity, and peace of mind to Medicare consumers in a landscape often marked by confusion, and uncertainty. The U.S. has over 67 million Medicare eligible consumers, with over half enrolled in Medicare Advantage, or MA. In many geographic regions, consumers face over 40 different plan options, creating confusion and deterring them from exploring better options. GoHealth seeks to simplify these decisions by empowering consumers with unbiased tools and guidance. At GoHealth, we strive to empower Medicare eligible consumers with proprietary and unbiased tools used by our highly trained and experienced licensed agents. We have evolved from a traditional Medicare enrollment company to a Medicare engagement company, focusing on building long-term, high-quality relationships with our consumers. We believe this shift allows us to deliver a more integrated and personalized approach to care, reinforcing our unique role in the Medicare landscape. With that said, let me now turn to our first quarter results. which highlights strong operational execution and meaningful progress across our financial and strategic priorities. Our performance in the quarter exceeded our expectations. Notably, submission volume in Q1 increased from the previous year, driven by our captive Medicare team's impressive 64% year-over-year growth, while agent headcount only grew by 24% year-over-year. Our Q1 2025 revenue increased to $221 million compared to $186 million, in Q1 2024, representing a 19% improvement. Q1 2025 adjusted EBITDA grew to $42 million, a 56% year-over-year improvement. Our Q1 results were driven by another quarter of improvements within our age of productivity. Thanks to the combination of stronger training programs and broader adoption of our AI-driven tools, including PlanGPT and the PlanFit tool, we cut enrollment average handle times by 12% compared to the same period last year. More importantly, our captive agents serve more consumers per day while still improving conversion rates. This balance between speed and quality shows the strength of our model and the discipline we've built into our operations. Similar to what we communicated after AEP, we attempt to deploy our capital to drive the most appropriate balance of risk and return. We have invested in valuable year-over-year growth driven by our strong direct cost of submission, or CAC, conversion rates, and capacity expansion. Due to a higher mix of agency versus non-agency submissions, we reported a year-over-year decrease in cash flow from operations of $25 million, and in line with our product mix expectations, a 15% year-over-year decrease in sales per submission. Reflecting on our first quarter performance, I want to take a few minutes to highlight three exciting developments that enable us to expand our ability to serve consumers. First is the launch of a new suite of products in the life insurance space, we have called Go Health Protect. Second is the continued evolution of our PlanFit platform. And third, there are several new technology enhancements that are already making a meaningful impact. As we continue to focus on innovation and diversification, we're excited to share that Go Health has launched Go Health Protect, a suite of products to cover unexpected life events with the expansion into Guaranteed Acceptance Life Insurance, often referred to as Final Expense Insurance, as the inaugural product. Guaranteed Acceptance Life Insurance is a simple, affordable product designed to help families cover the cost of funeral and burial expenses. This move is a natural extension of our core business and GoHealth's mission to ensure consumers' peace of mind when making healthcare decisions, enabling them to focus on living life. Our Medicare Advantage platform has been the foundation of GoHealth's success, but it's also inherently seasonal, with most of our activity concentrated around the Annual Enrollment Period, or AEP. That seasonality limits our ability to drive consistent revenue and cash flow throughout the year. Go Health Protect, led by our initial guaranteed acceptance life insurance offering, begins to help us solve that problem. This product offering aligns perfectly with our commitment to bringing peace of mind to the consumers we serve. We expect that it will also allow us to better support our existing customer base. We see a real opportunity here. Roughly half of the population over 65 does not have any life insurance coverage today. We also generate millions of leads annually across the same population. By leveraging our pre-existing relationship with this consumer base and our existing sales infrastructure, we believe we will be able to drive growth in a cost-effective way without significant new investment. I'm encouraged by the early progress. During the first quarter, we launched a partnership with a leader in the guaranteed acceptance life insurance space. They're a strong brand. simplified product offering have made them a great fit for our go-to-market approach. Together, we aim to deliver a high-quality, consumer-friendly product that our agents are genuinely excited to sell. With a significant percentage of our agents already holding life insurance licenses, the response has been overwhelmingly positive, and we expect this strong momentum to continue in the second quarter. From a financial standpoint, the economics are consistent with the structure and return profile of our non-agency contracts. The economic value per policy is attractive when factoring in average duration, expected persistency, and a materially lower acquisition cost compared to our core Medicare business. This creates strong unit economics and accelerated cash realization. In short, our move into GoHealth Protect is a highly strategic step for GoHealth. It diversifies our product portfolio, minimizes revenue seasonality, and we anticipate it will put us on a clear path toward long-term profitable growth. We believe it aligns with our mission, empowers our agents, and most importantly, allows us to better serve the consumers who count on us. As Go Health Protect was in its early testing phases during Q1, there was minimal contribution to revenue and adjusted EBITDA. However, we expect it to continue to ramp in Q2 and Q3 and thus be a meaningful contributor to the full year 2025 results and beyond. Second, we believe our Encompass and PlanFit platforms continue to set us apart and gain traction. These tools give consumers tailored guidance, whether that's enrolling in a new plan, finding a better fit, or simply validating that their current plan is still the best choice. In Q1, plan fit checkups grew 27% year over year, a strong sign that consumers are engaging more actively with us. Given the disruptions caused by plan exits and benefit changes, we saw a higher rate of plan switches than usual. At the same time, we helped roughly 15,000 consumers stay in their existing plans. reinforcing our focus on long-term value, not just short-term sales. Early results are encouraging, and we expect the program to keep growing. Third, we delivered several important technology launches with a concentration on automation and artificial intelligence that are enhancing both the consumer experience and agent efficiency. In early April, we launched MyGoHealth, giving consumers the ability to create a profile, save their personal information, and manage their Medicare journey more easily. We also piloted a unified enrollment experience that consolidated carrier applications into a single, streamlined process. Agents have already reported seeing faster enrollment and a simpler workflow. For our GPS downlight agencies, we completed the move to GPS Express, an innovation to our enrollment system that has improved the efficiency of the post-sale consumer experience. On the Go Health Protect expansion, we rolled out inbound marketing leads to our agents, and as expected, conversion rates are with manual outbound dialing. And finally, our marketing and operations teams have deployed a differentiated approach towards identifying, tailoring messaging, and conducting a deep needs assessment with consumers who may qualify for chronic condition special needs Medicare plans, or CSNAPs. Taken together, we believe these operational and technological investments are already driving better engagement, greater efficiency, and a stronger platform for sustainable growth. Additionally, we'd like to highlight a key regulatory development. CMS announced a 5.06% average increase in Medicare Advantage revenue for health plans, along with a 10.72% increase to the broker commission schedule in its final rate notice. This represents the most significant adjustment in over a decade and underscores the continued strength of the Medicare Advantage program. It also affirms the important role brokers play in helping beneficiaries navigate their options. Looking ahead, to the 2025 AEP, while we continue to anticipate positive market dynamics, our outlook has evolved. We anticipate another disruptive AEP. Some early indication of the upcoming disruption are the decisions made by health plans both during the fourth quarter of 2024 and more recently in Q2 to suppress plan commission eligibility to be even more targeted on where they want to grow, hold, or pull back for the remainder of plan year 2025. We believe these moves indicate a likely repricing of plan benefits to right-size margin profiles that will likely result in more consumers needing to assess their options. Due to our expectation to see health plans de-emphasize growth in Q2 and Q3, also referred to as the special election period or SEP, as well as the continued evolution of the Medicaid dual eligible changes, We plan to continue to ship more capacity into Go Health Protect for the remainder of SEP as we prepare for another dynamic shopping season in the fourth quarter. We will continue to monitor the market behavior and ultimately wait to see what happens with final health plan bids and product benefit changes to get a better view on the shopping and appropriate switching behaviors we can expect to see with consumers going into the 2026 plan year. We believe the market condition will be favorable ahead. Though our ability to capitalize on those conditions will be dependent on the health plan's benefit decisions, appetite for growth, and willingness to invest in the high-value service GoHealth provides alongside our operational and capital efficiency. Before I turn the call over to Brendan for a more detailed review of our financial results, I want to briefly address a matter that, while not new, has recently taken a procedural step forward. GO Health is aware that the United States Attorney's Office has decided to intervene in a key TAM lawsuit that names multiple defendants, including GO Health. The claims in both the action by the government as well as the original complaint are based on alleged violations of the False Claims Act and the Anti-Kickback Statute. This case has been under sealed and inactive for several years since it was originally filed. GO Health firmly denies the allegations made by the government in this lawsuit related to events that allegedly and 2021. We are disappointed that the government is pursuing claims against the company that strives to advance the interests of the Medicare Advantage Program and the Medicare beneficiaries it serves. We intend to vigorously defend against these claims and will not allow this litigation to distract us from our mission to provide peace of mind to the Medicare beneficiaries we serve. While we take this matter seriously, it does not change our focus or our momentum. We do not intend to further comment on ongoing litigation. Now I will turn the call over to Brendan Shanahan, our CFO, who will provide a more detailed review of our financial performance for Q1.