GoHealth, Inc. (GOCO) Earnings Call Transcript & Summary

Hi, everybody. Thanks so much for joining us this morning for the last day of the HealthCONx Conference. My name is Elizabeth Anderson. I'm the health care technology and distribution analyst here at Evercore. And I'm very pleased to be joined this morning by Clint Jones, CEO; and Travis Matthiesen, CFO of GoHealth. So thanks so much for joining us this morning, guys.

Thanks for having us.

Thank you.

So maybe just for -- to level set people who are potentially a little bit newer to health space or whatever, would you mind just sort of giving a 30,000 overview -- put overview for a second just to kind of level set everybody? And then we'll jump into the questions.

Sure, yes. GoHealth is an insurance marketplace, connecting consumers to health plans, really focused on the Medicare over 65 space and within that space, focused on the Medicare Advantage space. So in its simplest terms, we help educate and connect consumers that are in need of Medicare options to the right Medicare plan that meets their needs in their area.

Perfect. No, that sounds great. So maybe sort of some topical questions to kick it off. I think, obviously, you are -- we are days away from the end of AEP. So that's, I'm sure, exciting and a relief maybe to you guys to spend all year prepping for these weeks. Can you tell us about sort of how you're seeing things trend so far? And sort of any interesting updates from that perspective?

Yes, absolutely. So as you know, we've made a lot of investments this year and growing and scaling our agent base in preparation for this AEP, as last year, we saw a tremendous amount of opportunity that we missed due to drop calls and consumers calling in and us not being able to serve them. So what we've seen so far, if you start at the top of the funnel, a much more diversified approach around our marketing channels, which is paying off and drills around supply and demand matching, where last year, we were very reliant on TV as a main source. And with TV, you get surges of calls and ultimately get longer hold times and you tend to drop more calls versus this year, we've got a much more diversified approach, and that's working very well. We're also seeing strong performance out of the agent cohort. Obviously, newer agents aren't as strong as a tenured agent, but we're seeing the results that we kind of modeled out and anticipated for those newer agents. So from a kind of volume standpoint, that's all holding in line with our expectations and feel pretty good about the amount of demand that we're seeing on the platform. Obviously, with COVID continuing on, more and more seniors are leveraging phone-based or Internet-based enrollment versus a traditional meet, face-to-face type of activity, which we think will continue on as a long-term trend in the space. The one thing that we just don't have enough data into right now is effectuation data, renewal rates, as you think about older vintages getting through this next calendar year's renewal period. So we're obviously closely watching the quality, the renewal activity, effectuation rates, especially with our newer agents who are -- may not have the tenure and the training from a length standpoint to monitor that very effectively. But we feel really good at the kind of the volume of activity that we're seeing on the platform.

That's great. And one thing, as you -- you just talked about the newer agents coming on. How are you seeing productivity ramping in that newer cohort of agents and then maybe as well on the tenured agent side?

Yes. So there's obviously a direct correlation between a tenure even a number of days or weeks or months on the platform and performance, and that's kind of holds true with these newer agents as well. We're seeing a little better performance than we historically have primarily because we've spent so much time and effort in our training platform this year as we ramped up agents. And we've launched we call our Development Pod, which was a new program when you think about historically, all of our training pre-COVID have been face-to-face. And there's a different way of deploying training in a kind of a more face-to-face environment if you're in a classroom versus now everything is virtual. So kind of retooling and kind of lessons learned as you go along the way to improve that any way possible, which we'll continue to do as we move forward. But we're seeing those new cohorts of agents perform to expectation. Always room for improvement. We're excited about as they continue in their journey in their career with GoHealth, that tenure will continue to grow as well. And if I think about looking at next year, not having to bring on as many new agents, our tenure is naturally going to be higher on a per average per agent basis than it was this year. So we should continue to see those kind of results improve over time as well.

Yes. And maybe I know it's early, and we haven't even been through OEP yet, but how are you thinking about agent retention from this year to next year?

Yes. Great question. So we're seeing right now during AEP similar attrition results we saw last AEP, so nothing really alarming there. So we've got a kind of full on career progression, identifying the top performers, fully understanding what they're looking for in their jobs. And obviously, coming out of AEP, where you've got people working 10, 11, 12 hours, weekends, mornings, evenings is a lot to ask for people. So we've got some great ways they can earn a lot of time off during the latter part of December. But then ultimately, as we think about their career growth into 2022 and beyond, ways we can retain those agents, we've deployed kind of new, what I'll call, regionalized strategies around the workforce to try to develop more of a kind of a personal feel with their manager, especially in this work-from-home sort of environment that we're seeing early -- positive early results on. We'll continue to kind of deploy that out. But it's a clear focus of ours. And we've made a lot of investment in 2021 that we want to see the proper ROI as we think about 2022 and beyond. And a key part of that is retaining the agents and also continue to give them training, develop themselves as a positive career and show them this is a long-term place they can be.

Yes. No, that makes sense. And obviously, everybody's favorite question this week so far, the surprise on Thanksgiving this year with our new Omicron variant. I know it's early, and this is probably an unfair question because the data hasn't fully evolved yet. But just anything that you can say at this early point in time about any impact from that, or broadly speaking, the Delta wave, which has obviously been with us for a while on results or sort of your operations?

Yes. Since we've primarily remained work from home throughout the pandemic, we didn't experience or don't really experience any major disruption in performance or the operations. We'll continue to evaluate that and monitor it. Obviously, we have thought about bringing more people potentially back in office early next year. That may delay some of that activity, which is fine since we've been kind of operating in a work-for-home environment thus far, anyway, very successfully. I think what it does do, it lends to the consumer behavior of shopping online over the phone and keeping those trends going which we're seeing some of those -- that activity now, just the amount of inbound call volume we're seeing off of our media placements. So I would think that will continue throughout time because the seniors are obviously the most vulnerable to catching COVID in any variant just because of their age and their vulnerability. And if we can provide a service that allows them to stay at their -- within their home and safe that we can serve and help them enroll in the right plan, I mean, that's kind of what we're focused on.

Got it. No, that makes sense. I know there's a little glitch in my video right now, but hopefully you can still hear me, and I will [indiscernible]. What about on the marketing side? I mean, that's one of those things you kind of said in your earlier statement about the diversified marketing [indiscernible] this year. Can you kind of parse that out for us? I think people are [indiscernible] broadly familiar with what happened last year with the television and obviously the [indiscernible] et cetera. But it would just be helpful to get an update on sort of how you're seeing what you've done this year differently there.

Yes, you're cutting out a little bit, but I believe the majority of that was around the marketing activity to spend and what we're seeing kind of year-over-year. As I mentioned earlier, last year, we had a pretty big focus on DIRECTV. And we saw some competitive metrics in there that we didn't necessarily like, and we ultimately heavily focused on diversification this year and both online and offline. And that's paid off tremendously. It allows our team to really toggle and -- if I think about efficiencies in matching inbound calls versus agent capacity, when you just focus on TV or heavily focus on TV, it's harder to do that because you get surges of call activity. And if you think about last year during an election year, it was even harder to manage, where you get ads bumped because of a late breaking news on election result or just something about the election, and then ultimately, they don't clear at 7:00. By that time, you had a shift that went home and you had a lot of missed opportunities. This year, we're not seeing that. Because we have such a diversified marketing funnel, we can turn on and off campaigns based on the number of agents we have in ready or the capacity as we follow different shifts and shift activity. So we feel really good about that. Will DIRECTV always be part of what we do? Absolutely, because there's also a brand element of that, too. But it's -- we're heavily focused on other sources that seniors are responding to as well.

I imagine you have this like marketing war room like NASA style with like the big TVs and lots of people with computers. Is that -- am I picturing the right kind of thing?

Yes. We've got a -- one of our -- the first Florida office and headquarters in Chicago is like basically our war room with all of our marketing folks, our sales strategy folks, basically, anybody involved in supply and demand, and monitors everywhere, TVs everywhere, and looking at data kind of by the half hour increment or even in the minute increment and matching agents on ready, ads about to hit, power hours. You think about the high volume coming in during the middle of the day, there are certain ads that really pop that we've kind of monitored back and forth. So that team -- give them a lot of credit. They've been in the office, working together all AEP long hours, just to making sure we're humming along, and they've done a really good job with that this year.

Got it. No, that makes sense. The other hot topic, obviously, over the last couple of weeks since earnings has been on the new CMS marketing guidelines. Can you comment on where we are on that and sort of how you're seeing some of the new checking and sort of new scripting and things like that impacting AEP?

Yes. We didn't really see a ton of impact there. The big thing was about a week before AEP, CMS put out a ruling that all marketing materials needed to be filed with your plan sponsor ultimately with CMS. Because we've primarily done that in the past, it wasn't like a big issue for us. Our compliance team works very closely with our marketing team all the time on what we can and can't say. And we've got a pretty strict rule on what ads we could put out there. And if it doesn't pass our internal compliance, we know it's not going to pass the carrier's compliance and so on and so forth. And that's just kind of how we've operated. So we actually didn't see a material change or impact with that ruling. Granted there was a lot of like last-minute scrambling by our team to kind of get everything done, but not -- a few plans or a few ads changed here and there but nothing really material. I think long term, I think it's great what CMS is doing. At any time there's a focus on quality and activity that benefits the seniors and maybe removes advertisement that could be considered kind of misleading, if you will, I think it's great, right? So we welcome that. We think it's great for the industry. So hopefully, they continue to kind of enforce that, if they will.

Yes. And I myself have noticed, not that I hope I'm not like the target person for Medicare Advantage ads quite yet, but even the TVs that play in our office, you can definitely tell like the tone has changed, and it's much more like informational versus Joe Namath and sign up now kind of situation, right?

I think the big thing that we're really targeting is a lot of those ads basically said, you qualify for these benefits. But in reality, a lot of the benefits mentioned are really county or even ZIP code specific in a particular state. So you might have a senior in a county that actually doesn't qualify for those benefits. The benefits aren't even in plans in that area, and they're calling in because they're excited about some benefit that doesn't exist. That's what we're trying to avoid, right? You need to fully understand that every ZIP code and every county has different options available for each senior, and some of the benefits may or may not be available to that person.

Yes. Okay. That makes sense. So maybe one of the other things, obviously, you guys have talked about and -- is sort of the recapture rate. How are you sort of thinking about that at this point in time? Is there anything you can kind of update us on how the sort of changes that you guys have put in place are impacting results so far?

Yes. So a couple of high levels. So we've ramped up our, we call, our TeleCare team, right? It's our kind of customer service, post enrollment, the team that handles existing clients, helps them navigate their plan, what have you. So that team has been ramped up. We're receiving way more inbound activity from a call volume standpoint this year than we ever anticipated. So we're still kind of going through the data on the conversations that are occurring. But at a high level, the good news is they're calling us back, right? These are customers of ours that are calling us, asking questions versus going somewhere else and making a decision without speaking to us first. So that's a good news. I just don't have enough data right now to be able to determine like what exactly a lot of those conversations are doing. Most of the conversations with the reports we're getting are what we call positive conversations, which means re-enrollment, renewal. Maybe didn't know they had a benefit, but once they found out they have the benefit, they stay in that plan. So we'll have a lot of that data, especially as we get after AEP and what exactly happens there. So I think the good news is we had kind of a campaign this year that targeted our existing client base, if they had questions, call us, and that's working. So I think as the -- as we mature that team out, we get better kind of recapture, renewal. The challenge in the industry, if somebody calls us that's a Humana member one day, calls us back the next year and says, "Hey, I saw an ad for a different carrier, and I want to switch," that's technically a churn event for us, right? Even though that member stays with us, so we need to think about better ways of communicating like that membership or recapture rate as we think about 2022 and putting metrics out there.

Got it. And how do we think about -- speaking of the TeleCare sales team, how do we think about that transition sort of as we -- as AEP is winding up, though, I'm sure you don't -- don't feel like it's winding up yet given that we're in the last couple of crunch days, in terms of really sort of being able to grow that Encompass and sort of expand that out versus sort of what you've been able to do in prior years?

Yes. That's going to be a very clear focus of ours in 2022 as kind of take off the -- expand the momentum that we've had and the results we've had thus far in 2021. I think there's a lot of opportunity there. And we'll have an ample agent base, both on the Tier 2 side and the TeleCare side as we enter Q1 and Q2 to perform a lot of those services with that existing membership base, right? There's obviously services for carriers and services for providers and pharma that we're going after based on the needs of the customer. And you think about the D-SNP client versus the new to Medicare versus a potential switcher in the kind of the navigation path that they go down and we'll put them through. So that's something we didn't do last year. We're really excited about the opportunity this year when that could lead to results because we think not only it would impact Encompass but have a positive impact on our core LTVs as well as we're engaging with a higher percentage of our membership base.

Yes. No, for sure. I had one question that just came in on the chat was just maybe hugging back a little bit to one more question on CMS. Was just anything that you can say about any CTMs that you guys have heard about from the carriers during AEP and anything you can say sort of directionally about number or focus there?

Yes, good question. We have not heard a ton on CTMs. Any CTMs you'd be receiving now would be primarily for business written in Q2 and Q3. So it's not like it's immediate action. So we really have not heard anything on this AEP.

Okay. Got it. And can you comment on sort of how you guys think about -- obviously, churn is a big question, and I know you don't release specific churn statistics, but one of the overarching things that somewhat drives churn is like the richness of MA plans. So how do you think of how those changes and the richness of the MA plans is trending this year? And is there anything that you're sort of worried about as you think about AEP or even OEP into next quarter?

Yes, it's a good question. So every year, it seems like 1 or 2 carriers come out with like some new shiny benefit that consumers are really attracted to, which does cause friction in the market. And think about if you're on a plan that doesn't have a new benefit and you see advertisement for that, you're likely to at least call in and ask about it, which could cost churn, could cost switching. While we do see every year that happening, this year, the difference between like the top plan and what I'll call the bottom plan, that spread is not as wide as I've seen in the past, right, which means it started to like stabilize, if you will, meaning like all the carriers have really, really pretty solid plans. Now granted, there's always going to be the #1 plan from a benefit standpoint and number, whatever, last that is not as spread out this year. So we'll continue to monitor that. And that's one of the comments we made around effectuation rates and the renewal rates as we get through the end of the year from older vintages, how that looks like and the things we can do to influence that. We really won't know until we get into January. That's just -- that's kind of how we're thinking about it.

And maybe qualitatively, at least, what is the shiny new thing that plans are offering this year? I know in prior years, there's been $0 premiums or free sneakers or free gym memberships or Part D. There's obviously been some major steps up, but like what is it this year?

Yes. I mean there's some Part B giveback activity that's causing a lot of people like, hey, what is that? Can I -- am I eligible for that? So that's kind of one. There hasn't really been one thing outside of that, that we've seen like kind of sticking out, if you will. All the plans seem to be pretty competitive and the benefits they're offering and they have, which we think is good. It's still a very robust marketplace. It's based on their drugs, the doctors you go through, the specialists, what have you. There may be better plans in your area based on the network than others, and it's our job to really navigate those seniors to that and put them in the right plan.

Got it. Okay. One of the other hot topics that's come up in the last couple of weeks is the relationship between the DTC brokers and value-based care providers. So I was wondering if you could talk a little bit more about how you work with value-based care providers broadly and sort of any specific comment on the specific services that you're providing for them.

Yes, it's a good question. So we have a percentage of our membership that comes through that doesn't have a primary care provider, right? They're more -- or they don't have one. They don't care. They move. Something has happened where they're in the market for somebody but they're also looking for a plan. So there's an education process. We have a tool that if somebody is in a value-based care area, we can educate them on that. They can make the choice if they want to enroll in that or not and go from there. But really, we provide kind of education and what I'll call scheduling services into the value-based care models. And that's how we help them. And it's -- think about CMS put out some -- by 2030, they want to see as many people in Medicare and value-based care as possible. Same thing with carriers. The outcomes for consumers is really as positive. There's a lot of platforms and care models popping up that are really good for seniors and focus on seniors. We have a very large population of Medicare seniors coming through our platform. Most of those folks don't understand what value-based care and the benefit to them, so really the educational activity on that. We obviously saw kind of the thing that came out on the value-based care and the concern there. We looked into it, and we don't see really any issue that's tied to us in any sort of way.

Got it. Okay. And maybe 2 follow-up questions on that. One is how many value-based care providers are you working with currently?

There's going to be dozens.

Dozens. Okay.

Yes.

And then two, I noticed that you were -- you said education and then sort of scheduling services, so it's not technically a referral, right? Is that sort of the correct way to think about that?

In terms of the relationship and what we've set up, and some providers are more sophisticated than others. Others need our services. They go much deeper in the funnel. So it really depends on kind of what they're looking for, the area they're in, how we can help them, how we can help our clients. So we've got kind of unique offerings that we can go to market with.

Got it. Okay. That's helpful. And maybe talking about some other partnerships that you've talked about. Can you talk about your partnership with GoodRx? How is that trending? Can you remind people how exactly you're working together? And anything maybe even high level that you can say on sort of how the economics work for that partnership would be helpful.

Yes, absolutely. So there's really, what I'll call, a 2-way street in that partnership. The first one coming from activity on their platform of people that may be interested in Medicare plans, right? They obviously refer that over to us. We educate, enroll them in plans, and there's a kind of an economic arrangement there from a referral standpoint. The second are people on their platform -- or sorry, that are on our platform that may have interest in pharmacy savings, right? And we've identified ways if somebody is taking multiple drugs, and based on the plan they're in, GoodRx could be a really good ancillary solution for them to continue to save even more money on their pharmacy. And then we get ultimately paid a kind of fees for that introduction as well. So that is scaling up, right? We feel really good about that. I think it's a great benefit to seniors, especially the, what I'll call, the heavier users that we'll continue to look at and kind of push forward.

Okay. That makes sense. Sorry, I'm just chuckling on heavier users. But -- okay. So maybe all kidding aside, so one question then that has just come in. What are your ROI expectations for investments in membership growth? How do you gain confidence that those -- in those returns, given the uncertainty around churn retention, all these different factors that have been going on in the market recently?

Yes, it's a good question. The way -- we're still thinking about an LTV to CAC, right? And we're thinking about it as a couple of players in this space, we believe, will rise to the top, right? It's going to be -- it's -- we don't think in a couple of years, there's going to be a lot of players that can compete in this space as we continue to scale and grow. So our focus is really not about just the ROI like short-term ROI. We've got a long-term ROI creating a competitive moat, building a large base of activity that's going to be hard for others to kind of step into. So that's how we're thinking about it. And ultimately, as you get more and more scale with membership, you're able to have different conversations with carriers, especially on our Encompass platform, on ways we can help them better engage that membership, right? If we've already built the relationship with the clients, are there things that carriers are looking to do, whether it's CAHPS surveys, or [ risk ], HEDIS, other activities through an engagement type model that benefits carriers and you think about their star ratings and impacts there, then we can do. That's what we're focused on. I think that's where ultimately we're heading down that path. The only way to really get there is with scale and membership.

Got it. That makes sense. Can we talk about the key puts and takes in terms of the LTV results and changes in 3Q and then sort of your current expectations for 4Q?

Yes. Travis, do you want to take that?

Sure. So I think just to kind of review what we've outlined, and I think can be a little bit of a misnomer, not all MA plans and consumers are created equal, right? So there's a lot of ingredients to get into kind of what we report on as an average LTV. So if you think of the first kind of ingredient is consumer mix. And Clint mentioned earlier, there's a unique LTV and persistency traits of someone that's new to Medicare, a D-SNP or a switcher. So as those trends move, so think about a new to Medicare member has the highest LTV. D-SNP and switches have lower LTVs. So all things being equal, just that consumer mix changes, that drives down LTVs. And as we've grown, our new to Medicare mix, as we talked about in Q3, has come down, and we anticipate that to be the case here in Q4 as well. So that's kind of ingredient 1. Ingredient 2 is carrier mix. One thing that we've been focused on over the last couple of years, Clint mentioned it a lot, of taking kind of a rightful shot approach of any carriers as compared to shotgun. As recently as last year, right, we were adding still some major carriers, and this the first AEP that some carriers are fully integrated on our platform. The LTVs that we have for those carriers is also unique. So as that mix changes, you can get unique LTVs there. And as we've started to sell more and more of the new carriers to kind of start mimicking current market penetration, you've seen kind of some short-term pressure on LTVs as typically new carriers to our platforms have lower LTVs than experienced carriers. And then the third piece is agent mix. And Clint mentioned earlier, one of our biggest focus this year has been onboarding new agents. And we've seen that as agents get more tenured, the persistency traits, the effectuation traits, all of those improve over time. So when you've got -- in Q3 as an example, where a large part of our agent base was new and hitting the phone for the first time, that also puts a short-term pressure drag on LTVs. And so all of that -- all of those ingredients, right, end up getting us to kind of the lower LTVs year-over-year that we saw here in Q3 that we anticipate to be the same case here in Q4. But as I mentioned, kind of 2 of those 3 characteristics, right, carrier and agents, we think there's the opportunity to improve upon in 2022 and beyond.

Okay. And maybe just to dig into the impact of carrier mix a little bit. Obviously, the way I've always thought about it was just kind of like you're hitting certain minimums in terms of volume or things like that. Is that the right way to think about it? Is there any kind of geographical switch? Is there something else that we should think about? And can you give us a little bit more sort of color on sort of how you're seeing that trend as we move into next year?

Yes. Travis, I'll take a part of that, and if you want, you can chime in if you can.

Sure.

Yes, you're absolutely right. If you think about when we add a new carrier, we don't have a lot of historical data, right? So you can be a little more conservative and apply a constraint on how you're thinking about that carrier until you have enough scale and meaningful volume to actually build out their own LTV models. And anytime you start a new relationship, you tend to kind of have key milestones in that relationship based on either membership-based enrollment volume, some key metric where you kind of earn your way up. So that's ultimately what's happened. And we're -- after we exit this AEP, we'll clearly be in a position that's different than starting off with a brand-new relationship.

Okay. That's helpful. I'm sorry, Travis, did you -- did I cut you off?

No, no.

Okay, okay. Good. So maybe just switching to Encompass a little bit more. Obviously, we talked about it in terms of some of the services you guys provided, sort of maybe how you're thinking about growing the business in 2022. Where do you see sort of that growth from -- in 2022 coming from? Like could you talk about sort of maybe the penetration with carriers and sort of how that's progressing, maybe with established carriers or new carriers? Maybe we'll start there.

Yes. It will be kind of a two-pronged approach as we think about growth. One, as you mentioned, kind of targeting the carriers and ultimately deploying the engagement platform that we've put together to help those members out and engage those members based on what the carriers' needs are. So there's one channel there we'll be focused on. The other channel will be in, what I'll call, the provider space. That's both preferred providers and value-based care models and engaging and kind of driving that result. And so those would be our 2 main focuses as we think about growth in 2022.

Okay. Got it. And then is there anything in terms of new offerings? Or do you feel like you sort of have the, at least, base set of offerings now and it's kind of about what you just said, expanding that further with the carriers, and it's not really about like adding another category of services? Like how should we think about that as well?

Yes, exactly. So I think you're right. Over the past kind of year and as I think about 2021, carriers are -- get excited within our offerings, maybe on a couple of different things. But once they're on the platform, they see everything else we can do, we tend to expand that. So now we kind of have our base set of offerings, and we're kind of as opposed to an ala carte kind of you pick and choose where we're kind of going in more like, here's the platform, if you will. Here's the benefit and the value of the platform and what it does from retentions, rates, improvement in stars and other things that we're doing to improve the outcome they have on a per member basis. And also I think about there's uniqueness and behaviors based on type of customer as well, right? And we've got kind of unique cohorts of channels and customer paths to implement, again, whether you're new to Medicare, D-SNP, C-SNP, what have you. So that's all [indiscernible] as well. So fully kind of rolling those out. And then it's going to be a cadence of, can you continue to grow with the carriers you have? Can you add new carriers, right? Your pilots expand into full-blown offerings. Do you go from 2 states to 40 states, right? As you think about growth, and that's ultimately the moat we're going to be in as you think about 2022.

Got it. No, that's helpful. So maybe one part of the business that we haven't spoken about as much, honestly, a relatively smaller portion of your overall results is the IFP business. Obviously, we've had some changes in that market of late. And I just wanted to understand how you guys are sort of positioned in terms of that business right now. And at least at a qualitative level, how you're sort of thinking about your investments in that business in 2022.

Yes. It's another good question. So it's one of those things, Elizabeth, we've been kind of on autopilot for a few years now. We didn't want to completely turn it off as we didn't know -- as the administration changed between Trump and Biden. What was going to happen to the ACA. Ultimately, we feel that the ACA is a good platform and product, and when we were in it, just didn't have enough options, right, for like our business model and how that worked. More and more carriers came back in this year, right? I think it's yet to be determined, are those carriers going to stay, right? And is it going to be a robust offering? It feels like it is just because of the support the administration has put into it. So as we think about 2022, the strategy will be kind of evaluate what happened in 2021, how much enrollment volume came through that we had a 2022 effective date going for us. Ultimately, we have the relationships with all the carriers. We have a platform. We have the agent base. So we have all the key ingredients to really scale and ramp up. But it's one of those things that we just want to kind of probably do one more strategic oversight into and say, hey, is that our carriers -- isn't working for carriers, right? Obviously, it's working for consumers. If all those kind of check out, there may be an opportunity to kind of go because we still get a lot of activity of people coming in requesting. We just don't have a large team to service it.

Got it. No that makes sense. And maybe sort of pivoting on that a little bit, like how do you think about going forward, the sort of attractiveness of perhaps some kind of like on further development of like an online sign-up type of environment? Like you think of it -- I mean, you can have the stereotype of old people in technology or whatever, which we can debate how true that is. But you certainly could see that as maybe being more attractive in the IFP market. But I'd be curious to get your thoughts on that in both of those markets.

Yes. I mean, obviously, the IFP market we saw more activity kind of what I'll call D2C or just pure direct enrollment. And we've tested the Medicare side many times. I just haven't seen the same kind of throughput that we did in the IT market. So there's that. That will change ultimately over time, right? As there's more and more people are technically savvy, the person who's aging in at 65 has been using the Internet and buying online for the past 20 years, what have you, they're going to be used to making a lot of online transactions. So we'd be foolish to think, hey, that's not going to happen in the future. I think there's a way to kind of step your way into it. And through -- kind of we have an agent-assisted process where the consumer will talk to one of our agents. But ultimately, we'll send them the application. They can fill them on their own once they've chosen the plan, right? If you think about where that could go, that cuts down a lot of our talk time. So we have more agents free to talk to the next customer, provides more efficiencies in the channel and allows the consumer to kind of do it themselves. So we can expand upon that. We're not -- I'm not super bullish in the next several years, we're going to see a massive movement to pure D2C Medicare enrollments. There could be a subset of that, but is it going to be more than 5% or 10%? Probably not.

Got it. And how do we think about the sort of economics of that sort of D2C enrollment? Like I can think of -- obviously, you just talked about the lower agent time. With the -- with people filling out their own demographic information, do you get -- do you see -- I mean, I'm sure it's early-ish data now, but do you see sort of any kind of difference in drop-off rates or anything else, as you said? Or maybe in some ways, people understand the plan, they got better because they can see it as well? Anything you can provide on that, that would be helpful, too.

So I think any time somebody, kind of what I'll call, let's say, electronically signs or fills out something, they're probably a little more bought in, right? They feel like they've got ownership of that. So there's that characteristic. It takes more activity from a traffic standpoint and a cost standpoint to get them to do that. versus calling in and have one of our agents and roll it over the phone and talk to them that way. So it's kind of a trade-off, right? You may see better LTVs, but you're going to see a higher cost to get there.

Got it. Okay. That's a helpful way to think about it. Okay. Maybe -- I mean, one of the things that's been I don't know if interesting is the right word. But in this space over the last few , it's like we're at sort of valuation levels where if we look at your market cap versus just even like your receivables balance, like there's not much difference there, right? Like that seems it. What would you say to people who are sort of worried about -- I guess, you could either say 1 of 2 things. One is that there's some risk to the receivables balance; or two, that like this is screamingly cheap, so -- and GoHealth is [ a buy ]. I have a suspicion which one -- which side of that debate you would come out of. But could you sort of talk through those 2 elements of it and provide sort of your thoughts at the moment?

I'm going to go with door #2.

I'm shocked that you picked that. But maybe talk through why -- talk through sort of maybe -- can you talk through some of the worries about why you don't think that, that people should be worried about that receivables balance?

Yes. And I think if you think about over the past year, there's been all these conversations around churn, LTV changes, what have you. And the whole sector has been under a lot of pressure, right? We're not the cutest apple in a bunch, if you will, at this point in time, which we had fully understand. But I also think people have their skepticism around is that future receivable real, right? And I totally understand it. So our focus is on we're having positive conversations around what can we do with that, right? How can we potentially leverage that future asset base from a working capital standpoint to continue to accelerate and grow the business? So -- and that's not uncommon to securitize or whatever certain future receivables. So I think that would be a step in the right direction of people say, "Oh, this is real," right?

Because that would provide an independent valuation, right?

Exactly. So that's something we'll evaluate if we need be, and if that's something we feel that could provide clarity in the space, we will. Because you think about it, we'll exit this year with north of $1 billion in that future asset base. As we think about growing and scaling into next year, that will just continue to grow. So there's opportunity there. But to your point, I think people just -- or skepticism around isn't real. Travis, any comments you want to add to that?

Yes. I would say the other thing, too, and we touched on it a little bit earlier, which is why we've been so focused on TeleCare and Encompass is that a churn event, right, is a churn of the policy, not necessarily of the member. And so to the extent that we are creating a platform and an engagement with consumers, if someone wants to come back and switch next year and we provide that service to them, while that will be a churn event, we're still keeping that consumer. And we're still keeping that member and ultimately collecting commission on that new plan. And so when you look at the stickiness rate of individuals that enroll in a Medicare Advantage plan, they renew, right, year-after-year. Very few times, it's helped someone enrolling a Medicare Advantage plan and ultimately lead Medicare Advantage. And so I think it's both what Clint mentioned of leveraging that asset, getting third-party valuation being able to validate that, that asset is real. But then more importantly, showing that members continue to come back to us. So even if there is a new shiny plan, like Clint mentioned earlier, they're still coming to us to find that plan, which also insulates us from it. So I think those 2 pieces are the biggest things that we need to continue to emphasize and illustrate over time to kind of push back on that thesis.

Okay. And that's something that you guys are intending to continue to report to us about sort of recapture rates and that kind of thing as we move forward.

Yes, absolutely.

Yes. Okay. Perfect. That's helpful. So I guess, what do you think at this point is the most misunderstood thing about GoHealth and sort of the opportunity as you guys see it in your seats?

Yes, yes. Unfortunately, I think the accounting aspect of this business is unique, right, which just gives a lot of investors heartburn because it's -- you can't usually explain it to them in 2 minutes. So I think any time you have that, people like, "I'm on to the next thing," which I understand. So as we think about 2022 as other better ways to tell that story, show different metrics around membership based growth, what have you because if you think about the value prop to the consumer is extremely high, right? This is a product and service all seniors need, and most seniors don't fully understand exactly what's available to them. So the value prop of the consumer is extremely strong and what we're providing. The value prop to the carriers that we're servicing is extremely high, as they think about their growth and putting numbers in their plans. So the core business kind of fundamentals/what we're doing in the market is really, really important. I think we're just misunderstood. I think the accounting activity and the way LTVs are calculated and ultimately, the 606 reporting has just got a lot of investors like, hey, what exactly is this? What's this future cash flow model? Better explain it to me. And if I don't understand it, like I said, 2, 3, 4, 5 minutes, I'm on to the next thing.

Yes. No, I think that's probably right. Is that -- how do you sort of -- like is it just sort of like a continued like education investment? Like how do we sell the 606 problem, Clint?

Yes. I mean I think that ultimately, this comes down to what point in the future based on growth rates, are these businesses cash flow neutral or cash flow positive, right? I think that's a lot of comments we get. And can you put out a multiyear plan, and based on your membership growth and the growth in the business when you get there. The big challenge there is you can get there really quickly by slowing down, right? And lo and all, that past cash to catch up, right, you got to have that. We don't think that's the right long-term strategic thing to do for this business, right? We think it's continue to grow, right, continue to get gain scale, gain membership, add additional products and services to service that membership, both direct to the consumer and for the carrier as you create kind of additional barriers to entry in a competitive moat around the platform as we go and scale. We think that if I ask 10 seniors out there that think about Medicare, not one of them is going to know a brand in the space. Now they may say, "Hey, I saw Joe Namath on TV," but they don't know what company that it is or the company. So I think there's a huge opportunity for us to continue to invest in our brand. And a year from now when people are talking about Medicare at a lunch and our dinner, they're all talking about GoHealth, right? That starts to get to the platform that we need to be in the space, and that's what we're focused on. And I think over time, investors will see the value there and the benefit of it, and we'll continue to get out in front and educate on 606 and educate on future cash flows and what have you, but remain heads down and focused on executing the plan.

Good. I think that's good. That's good. Well, I think that's probably the right place to end it at this point, but I thank you guys so much for joining us. I know it's a little early in Chicago, and it's obviously a super busy week for you guys. So I really appreciate the time today, and look forward to catching up with you guys again soon.

Awesome. Thanks, Elizabeth. Thanks for having us.

Thank you.

Thank you.