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Adoption Impact of New Revenue Standard | 12 Months Ended
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Dec. 31, 2017
Accounting Changes and Error Corrections [Abstract] |
Adoption Impact of New Revenue Standard | Adoption Impact of New Revenue Standard As discussed in Note 1 Summary of Significant Accounting Policies, the FASB issued ASU 2014-09 in 2014, which, as amended, created ASC 606. The core principle of ASC 606 is that an entity shall recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The standard also contains significant new disclosure requirements regarding the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. We adopted ASC 606 effective January 1, 2018, on a retrospective basis. We have applied the standard to all contracts. We reviewed our sales compensation plans, which are directed at converting leads into approved members, and concluded that they are fulfillment costs and not costs to obtain a contract with a health insurance carrier, which we define as our customer. Additionally, we reviewed compensation plans related to personnel responsible for identifying new health insurance carriers and entering into contracts with new health insurance carriers and concluded that no incremental costs are incurred to obtain such contracts. The following tables present the impact of the adoption of ASC 606 on our previously reported historical results for the periods presented (in thousands):
2016 Balance Sheet Impact |  |  |  |  |
| December 31, 2016
| As Reported |  | ASC 606 Adoption Adjustment |  | As Adjusted
Assets |  |  |  |  |
Current assets: |  |  |  |  |
Cash and cash equivalents | $ | 61,781 |  |  | $ | — |  |  | $ | 61,781 |
Accounts receivable | 9,213 |  |  | (7,265 | ) |  | 1,948 |
Commissions receivable - current | — |  |  | 104,726 |  |  | 104,726 |
Prepaid expenses and other current assets | 5,148 |  |  | (1,071 | ) |  | 4,077 |
Total current assets | 76,142 |  |  | 96,390 |  |  | 172,532 |
Commissions receivable - non-current | — |  |  | 153,051 |  |  | 153,051 |
Property and equipment, net | 5,608 |  |  | — |  |  | 5,608 |
Other assets | 4,473 |  |  | (666 | ) |  | 3,807 |
Intangible assets, net | 8,580 |  |  | — |  |  | 8,580 |
Goodwill | 14,096 |  |  | — |  |  | 14,096 |
Total assets | $ | 108,899 |  |  | $ | 248,775 |  |  | $ | 357,674 |
Liabilities and stockholders’ equity |  |  |  |  |
Current liabilities: |  |  |  |  |
Accounts payable | $ | 5,112 |  |  | $ | — |  |  | $ | 5,112 |
Accrued compensation and benefits | 10,920 |  |  | — |  |  | 10,920 |
Accrued marketing expenses | 7,158 |  |  | 900 |  |  | 8,058 |
Other current liabilities | 4,734 |  |  | (3,086 | ) |  | 1,648 |
Total current liabilities | 27,924 |  |  | (2,186 | ) |  | 25,738 |
Deferred income taxes - non-current | — |  |  | 75,403 |  |  | 75,403 |
Other non-current liabilities | 3,374 |  |  | 879 |  |  | 4,253 |
Stockholders' equity: |  |  |  |  |
Common stock | 29 |  |  | — |  |  | 29 |
Additional paid-in-capital | 272,778 |  |  | — |  |  | 272,778 |
Treasury stock, at cost | (199,998 | ) |  | — |  |  | (199,998 | )
Retained earnings | 4,616 |  |  | 174,682 |  |  | 179,298 |
Accumulated other comprehensive income | 176 |  |  | (3 | ) |  | 173 |
Total stockholders' equity | 77,601 |  |  | 174,679 |  |  | 252,280 |
Total liabilities and stockholders' equity | $ | 108,899 |  |  | $ | 248,775 |  |  | $ | 357,674 |
2017 Balance Sheet Impact |  |  |  |  |
| December 31, 2017
| As Reported |  | ASC 606 Adoption Adjustment |  | As Adjusted
Assets |  |  |  |  |
Current assets: |  |  |  |  |
Cash and cash equivalents | $ | 40,293 |  |  | $ | — |  |  | $ | 40,293 |
Accounts receivable | 9,894 |  |  | (8,419 | ) |  | 1,475 |
Commissions receivable - current | — |  |  | 109,666 |  |  | 109,666 |
Prepaid expenses and other current assets | 4,845 |  |  | (540 | ) |  | 4,305 |
Total current assets | 55,032 |  |  | 100,707 |  |  | 155,739 |
Commissions receivable - non-current | — |  |  | 169,751 |  |  | 169,751 |
Property and equipment, net | 4,705 |  |  | — |  |  | 4,705 |
Other assets | 7,317 |  |  | (30 | ) |  | 7,287 |
Intangible assets, net | 7,540 |  |  | — |  |  | 7,540 |
Goodwill | 14,096 |  |  | — |  |  | 14,096 |
Total assets | $ | 88,690 |  |  | $ | 270,428 |  |  | $ | 359,118 |
Liabilities and stockholders’ equity |  |  |  |  |
Current liabilities: |  |  |  |  |
Accounts payable | $ | 3,246 |  |  | $ | — |  |  | $ | 3,246 |
Accrued compensation and benefits | 15,498 |  |  | — |  |  | 15,498 |
Accrued marketing expenses | 4,088 |  |  | 605 |  |  | 4,693 |
Other current liabilities | 3,815 |  |  | (1,807 | ) |  | 2,008 |
Total current liabilities | 26,647 |  |  | (1,202 | ) |  | 25,445 |
Deferred income taxes - non-current | — |  |  | 45,089 |  |  | 45,089 |
Other non-current liabilities | 900 |  |  | 1,020 |  |  | 1,920 |
Stockholders' equity: |  |  |  |  |
Common stock | 30 |  |  | — |  |  | 30 |
Additional paid-in-capital | 281,706 |  |  | — |  |  | 281,706 |
Treasury stock, at cost | (199,998 | ) |  | — |  |  | (199,998 | )
Retained earnings | (20,796 | ) |  | 225,520 |  |  | 204,724 |
Accumulated other comprehensive income | 201 |  |  | 1 |  |  | 202 |
Total stockholders' equity | 61,143 |  |  | 225,521 |  |  | 286,664 |
Total liabilities and stockholders' equity | $ | 88,690 |  |  | $ | 270,428 |  |  | $ | 359,118 |
2015 Income Statement Impact |  |  |  |  |
| Year Ended December 31, 2015
Statement of Operations | As Reported |  | ASC 606 Adoption Adjustment |  | As Adjusted
Revenue: |  |  |  |  |
Commission | $ | 171,257 |  |  | $ | 13,676 |  |  | $ | 184,933 |
Other | 18,284 |  |  | 130 |  |  | 18,414 |
Total revenue | 189,541 |  |  | 13,806 |  |  | 203,347 |
Operating costs and expenses: |  |  |  |  |
Cost of revenue | 4,178 |  |  | (2,231 | ) |  | 1,947 |
Marketing and advertising | 75,571 |  |  | — |  |  | 75,571 |
Customer care and enrollment | 43,159 |  |  | — |  |  | 43,159 |
Technology and content | 36,351 |  |  | — |  |  | 36,351 |
General and administrative | 30,239 |  |  | — |  |  | 30,239 |
Restructuring charges (benefit) | 4,541 |  |  | — |  |  | 4,541 |
Amortization of intangible assets | 1,153 |  |  | — |  |  | 1,153 |
Total operating costs and expenses | 195,192 |  |  | (2,231 | ) |  | 192,961 |
Income (loss) from operations | (5,651 | ) |  | 16,037 |  |  | 10,386 |
Other income, net | 45 |  |  | 1,240 |  |  | 1,285 |
Income (loss) before income taxes | (5,606 | ) |  | 17,277 |  |  | 11,671 |
Provision (benefit) for income taxes | (843 | ) |  | 8,550 |  |  | 7,707 |
Net income (loss) | $ | (4,763 | ) |  | $ | 8,727 |  |  | $ | 3,964 |
Net income (loss) per basic share | $ | (0.26 | ) |  | $ | 0.48 |  |  | $ | 0.22 |
Net income (loss) per diluted share | $ | (0.26 | ) |  | $ | 0.48 |  |  | $ | 0.22 |
2016 Income Statement Impact |  |  |  |  |
| Year Ended December 31, 2016
Statement of Operations | As Reported |  | ASC 606 Adoption Adjustment |  | As Adjusted
Revenue: |  |  |  |  |
Commission | $ | 170,850 |  |  | $ | 6,384 |  |  | $ | 177,234 |
Other | 16,110 |  |  | (20 | ) |  | 16,090 |
Total revenue | 186,960 |  |  | 6,364 |  |  | 193,324 |
Operating costs and expenses: |  |  |  |  |
Cost of revenue | 3,176 |  |  | (2,314 | ) |  | 862 |
Marketing and advertising | 72,213 |  |  | — |  |  | 72,213 |
Customer care and enrollment | 48,718 |  |  | — |  |  | 48,718 |
Technology and content | 32,749 |  |  | — |  |  | 32,749 |
General and administrative | 35,216 |  |  | — |  |  | 35,216 |
Restructuring charges (benefit) | (297 | ) |  | — |  |  | (297 | )
Amortization of intangible assets | 1,040 |  |  | — |  |  | 1,040 |
Total operating costs and expenses | 192,815 |  |  | (2,314 | ) |  | 190,501 |
Income (loss) from operations | (5,855 | ) |  | 8,678 |  |  | 2,823 |
Other income, net | 102 |  |  | 1,047 |  |  | 1,149 |
Income (loss) before income taxes | (5,753 | ) |  | 9,725 |  |  | 3,972 |
Provision (benefit) for income taxes | (871 | ) |  | 4,539 |  |  | 3,668 |
Net income (loss) | $ | (4,882 | ) |  | $ | 5,186 |  |  | $ | 304 |
Net income (loss) per basic share | $ | (0.27 | ) |  | $ | 0.29 |  |  | $ | 0.02 |
Net income (loss) per diluted share | $ | (0.27 | ) |  | $ | 0.29 |  |  | $ | 0.02 |
2017 Income Statement Impact |  |  |  |  |
| Year Ended December 31, 2017
Statement of Operations | As Reported |  | ASC 606 Adoption Adjustment |  | As Adjusted
Revenue: |  |  |  |  |
Commission | $ | 158,424 |  |  | $ | 18,459 |  |  | $ | 176,883 |
Other | 13,931 |  |  | (108 | ) |  | 13,823 |
Total revenue | 172,355 |  |  | 18,351 |  |  | 190,706 |
Operating costs and expenses: |  |  |  |  |
Cost of revenue | 2,273 |  |  | (1,691 | ) |  | 582 |
Marketing and advertising | 65,874 |  |  | — |  |  | 65,874 |
Customer care and enrollment | 59,183 |  |  | — |  |  | 59,183 |
Technology and content | 32,889 |  |  | — |  |  | 32,889 |
General and administrative | 39,969 |  |  | — |  |  | 39,969 |
Acquisition costs | 621 |  |  | — |  |  | 621 |
Amortization of intangible assets | 1,040 |  |  | — |  |  | 1,040 |
Total operating costs and expenses | 201,849 |  |  | (1,691 | ) |  | 200,158 |
Income (loss) from operations | (29,494 | ) |  | 20,042 |  |  | (9,452 | )
Other income, net | 327 |  |  | 855 |  |  | 1,182 |
Income (loss) before income taxes | (29,167 | ) |  | 20,897 |  |  | (8,270 | )
Benefit from income taxes | (3,755 | ) |  | (29,941 | ) |  | (33,696 | )
Net income (loss) | $ | (25,412 | ) |  | $ | 50,838 |  |  | $ | 25,426 |
Net income (loss) per basic share | $ | (1.37 | ) |  | $ | 2.74 |  |  | $ | 1.37 |
Net income (loss) per diluted share | $ | (1.37 | ) |  | $ | 2.70 |  |  | $ | 1.33 |
2015 Operating Segment Impact |  |  |  |  |
| Year Ended December 31, 2015
| As Reported |  | ASC 606 Adoption Adjustment |  | As Adjusted
Revenue |  |  |  |  |
Medicare segment revenue | $ | 63,163 |  |  | $ | 34,875 |  |  | $ | 98,038 |
Individual, Family and Small Business segment revenue | 126,378 |  |  | (21,069 | ) |  | 105,309 |
Total revenue | $ | 189,541 |  |  | $ | 13,806 |  |  | $ | 203,347 |
Segment profit (loss) |  |  |  |  |
Medicare segment profit (loss) | $ | (23,284 | ) |  | $ | 36,882 |  |  | $ | 13,598 |
Individual, Family and Small Business segment profit | 59,499 |  |  | (20,845 | ) |  | 38,654 |
Total segment profit | 36,215 |  |  | 16,037 |  |  | 52,252 |
Corporate | (25,135 | ) |  | — |  |  | (25,135 | )
Stock-based compensation expense | (6,889 | ) |  | — |  |  | (6,889 | )
Depreciation and amortization | (4,148 | ) |  | — |  |  | (4,148 | )
Restructuring (charge) benefit | (4,541 | ) |  | — |  |  | (4,541 | )
Amortization of intangible assets | (1,153 | ) |  | — |  |  | (1,153 | )
Other income, net | 45 |  |  | 1,240 |  |  | 1,285 |
Income (loss) before provision (benefit) for income taxes | $ | (5,606 | ) |  | $ | 17,277 |  |  | $ | 11,671 |
2016 Operating Segment Impact |  |  |  |  |
| Year Ended December 31, 2016
| As Reported |  | ASC 606 Adoption Adjustment |  | As Adjusted
Revenue |  |  |  |  |
Medicare segment revenue | $ | 80,269 |  |  | $ | 41,887 |  |  | $ | 122,156 |
Individual, Family and Small Business segment revenue | 106,691 |  |  | (35,523 | ) |  | 71,168 |
Total revenue | $ | 186,960 |  |  | $ | 6,364 |  |  | $ | 193,324 |
Segment profit (loss) |  |  |  |  |
Medicare segment profit (loss) | $ | (33,141 | ) |  | $ | 43,535 |  |  | $ | 10,394 |
Individual, Family and Small Business segment profit | 67,905 |  |  | (34,855 | ) |  | 33,050 |
Total segment profit | 34,764 |  |  | 8,680 |  |  | 43,444 |
Corporate | (29,071 | ) |  | (2 | ) |  | (29,073 | )
Stock-based compensation expense | (7,266 | ) |  | — |  |  | (7,266 | )
Depreciation and amortization | (3,539 | ) |  | — |  |  | (3,539 | )
Restructuring (charge) benefit | 297 |  |  | — |  |  | 297 |
Amortization of intangible assets | (1,040 | ) |  | — |  |  | (1,040 | )
Other income, net | 102 |  |  | 1,047 |  |  | 1,149 |
Income (loss) before provision (benefit) for income taxes | $ | (5,753 | ) |  | $ | 9,725 |  |  | $ | 3,972 |
2017 Operating Segment Impact |  |  |  |  |
| Year Ended December 31, 2017
| As Reported |  | ASC 606 Adoption Adjustment |  | As Adjusted
Revenue |  |  |  |  |
Medicare segment revenue | $ | 102,584 |  |  | $ | 39,864 |  |  | $ | 142,448 |
Individual, Family and Small Business segment revenue | 69,771 |  |  | (21,513 | ) |  | 48,258 |
Total revenue | $ | 172,355 |  |  | $ | 18,351 |  |  | $ | 190,706 |
Segment profit (loss) |  |  |  |  |
Medicare segment profit (loss) | $ | (18,760 | ) |  | $ | 40,897 |  |  | $ | 22,137 |
Individual, Family and Small Business segment profit | 30,427 |  |  | (20,854 | ) |  | 9,573 |
Total segment profit | 11,667 |  |  | 20,043 |  |  | 31,710 |
Corporate | (26,969 | ) |  | (1 | ) |  | (26,970 | )
Stock-based compensation expense | (9,694 | ) |  | — |  |  | (9,694 | )
Depreciation and amortization | (2,837 | ) |  | — |  |  | (2,837 | )
Acquisition costs | (621 | ) |  |  |  | (621 | )
Amortization of intangible assets | (1,040 | ) |  | — |  |  | (1,040 | )
Other income, net | 327 |  |  | 855 |  |  | 1,182 |
Income (loss) before provision (benefit) for income taxes | $ | (29,167 | ) |  | $ | 20,897 |  |  | $ | (8,270 | )
2015 Cash Flow Impact - Operating Activities |  |  |  |  |
| Year Ended December 31, 2015
| As Reported |  | ASC 606 Adoption Adjustment |  | As Adjusted
Operating activities |  |  |  |  |  |  |
Net income (loss) | $ | (4,763 | ) |  | $ | 8,727 |  |  | $ | 3,964 |
Adjustments to reconcile net income to net cash provided by operating activities: |  |  |  |  |  |  |  |
Depreciation and amortization | 4,148 |  |  | — |  |  | 4,148 |
Amortization of internally developed software | 627 |  |  | — |  |  | 627 |
Amortization of book-of-business consideration | 2,006 |  |  | (2,006 | ) |  | — |
Amortization of intangible assets | 1,153 |  |  | — |  |  | 1,153 |
Stock-based compensation expense | 7,002 |  |  | — |  |  | 7,002 |
Deferred income taxes | 101 |  |  | 8,550 |  |  | 8,651 |
Other non-cash items | 106 |  |  | — |  |  | 106 |
Changes in operating assets and liabilities: |  |  |  |  |  |  |  |
Accounts receivable | (1,447 | ) |  | 397 |  |  | (1,050 | )
Commissions receivable | — |  |  | (15,050 | ) |  | (15,050 | )
Prepaid expenses and other assets | 997 |  |  | — |  |  | 997 |
Accounts payable | (2,949 | ) |  | — |  |  | (2,949 | )
Accrued compensation and benefits | 6,180 |  |  | — |  |  | 6,180 |
Accrued marketing expenses | 1,991 |  |  | (126 | ) |  | 1,865 |
Deferred revenue | (642 | ) |  | (128 | ) |  | (770 | )
Accrued restructuring charges | 433 |  |  | — |  |  | 433 |
Other current liabilities | (1,247 | ) |  | (364 | ) |  | (1,611 | )
Net cash provided by operating activities | $ | 13,696 |  |  | $ | — |  |  | $ | 13,696 |
2016 Cash Flow Impact - Operating Activities |  |  |  |  |
| Year Ended December 31, 2016
| As Reported |  | ASC 606 Adoption Adjustment |  | As Adjusted
Operating activities |  |  |  |  |  |  |
Net income (loss) | $ | (4,882 | ) |  | $ | 5,186 |  |  | $ | 304 |
Adjustments to reconcile net income to net cash provided by operating activities: |  |  |  |  |  |  |  |
Depreciation and amortization | 3,539 |  |  | — |  |  | 3,539 |
Amortization of internally developed software | 936 |  |  | — |  |  | 936 |
Amortization of book-of-business consideration | 1,649 |  |  | (1,649 | ) |  | — |
Amortization of intangible assets | 1,040 |  |  | — |  |  | 1,040 |
Stock-based compensation expense | 7,266 |  |  | — |  |  | 7,266 |
Deferred income taxes | 114 |  |  | 4,538 |  |  | 4,652 |
Other non-cash items | (233 | ) |  | 90 |  |  | (143 | )
Changes in operating assets and liabilities: |  |  |  |  |  |  |  |
Accounts receivable | 434 |  |  | 1,129 |  |  | 1,563 |
Commissions receivable | — |  |  | (8,032 | ) |  | (8,032 | )
Prepaid expenses and other assets | (486 | ) |  | — |  |  | (486 | )
Accounts payable | 2,227 |  |  | — |  |  | 2,227 |
Accrued compensation and benefits | (3,466 | ) |  | — |  |  | (3,466 | )
Accrued marketing expenses | (3,540 | ) |  | (366 | ) |  | (3,906 | )
Deferred revenue | 567 |  |  | 20 |  |  | 587 |
Accrued restructuring charges | (433 | ) |  | — |  |  | (433 | )
Other current liabilities | (649 | ) |  | (916 | ) |  | (1,565 | )
Net cash provided by operating activities | $ | 4,083 |  |  | $ | — |  |  | $ | 4,083 |
2017 Cash Flow Impact - Operating Activities |  |  |  |  |
| Year Ended December 31, 2017
| As Reported |  | ASC 606 Adoption Adjustment |  | As Adjusted
Operating activities |  |  |  |  |  |  |
Net income (loss) | $ | (25,412 | ) |  | $ | 50,838 |  |  | $ | 25,426 |
Adjustments to reconcile net income to net cash used in operating activities: |  |  |  |  |  |  |
Depreciation and amortization | 2,837 |  |  | — |  |  | 2,837 |
Amortization of internally developed software | 1,464 |  |  | — |  |  | 1,464 |
Amortization of book-of-business consideration | 1,167 |  |  | (1,167 | ) |  | — |
Amortization of intangible assets | 1,040 |  |  | — |  |  | 1,040 |
Stock-based compensation expense | 9,694 |  |  | — |  |  | 9,694 |
Deferred income taxes | (401 | ) |  | (29,940 | ) |  | (30,341 | )
Other non-cash items | (101 | ) |  | — |  |  | (101 | )
Changes in operating assets and liabilities: |  |  |  |  |  |  |
Accounts receivable | (681 | ) |  | 1,154 |  |  | 473 |
Commissions receivable | — |  |  | (21,640 | ) |  | (21,640 | )
Prepaid expenses and other assets | (1,933 | ) |  | — |  |  | (1,933 | )
Accounts payable | (1,866 | ) |  | — |  |  | (1,866 | )
Accrued compensation and benefits | 4,578 |  |  | — |  |  | 4,578 |
Accrued marketing expenses | (3,070 | ) |  | (295 | ) |  | (3,365 | )
Deferred revenue | (574 | ) |  | 108 |  |  | (466 | )
Accrued restructuring charges | — |  |  | — |  |  | — |
Other current liabilities | (2,283 | ) |  | 942 |  |  | (1,341 | )
Net cash used in operating activities | $ | (15,541 | ) |  | $ | — |  |  | $ | (15,541 | )

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- Definition The entire disclosure of changes in accounting principles, including adoption of new accounting pronouncements, that describes the new methods, amount and effects on financial statement line items. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 250 -URI http://asc.fasb.org/topic&trid=2122394 + Details
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