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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2022
OR
 TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to

Commission File Number: 001-33071
_____________________________________________
EHEALTH, INC.
(Exact name of registrant as specified in its charter)
_____________________________________________
Delaware
56-2357876
(State or other jurisdiction of incorporation or organization)(I.R.S. Employer Identification No.)

2625 AUGUSTINE DRIVE, SECOND FLOOR
SANTA CLARA, CA 95054
 (Address of principal executive offices)

(650) 210-3150
(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading SymbolName of each exchange on which registered
Common Stock, par value $0.001 per shareEHTHThe Nasdaq Stock Market LLC

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulations S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer
Accelerated filer
Non-accelerated filerSmaller reporting company
Emerging growth Company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No
The number of shares of the registrant’s common stock, par value $0.001 per share, outstanding as of July 29, 2022 was 27,257,171 shares.




EHEALTH, INC.
FORM 10-Q

TABLE OF CONTENTS
PART I FINANCIAL INFORMATIONPAGE
Summary of Risk Factors
2
Item 1.
Item 2.
Item 3.
Item 4.
PART II 
OTHER INFORMATION
Item 1.
Item 1A.
Item 5.
Item 6.





















1




Summary of Risk Factors

The following is a summary of the principal risks we face, any of which could adversely affect our business, operating results, financial condition or prospects:

If our ability to enroll individuals during enrollment periods is impeded or if investments we make in enrollment periods do not result in the returns we expected when making those investments, our business, operating results and financial condition would be harmed.
We may be unsuccessful in competing effectively against current and future competitors, including government-run health insurance exchanges.
Our business may be harmed if we lose our relationship with health insurance carriers or our relationship with health insurance carriers is modified.
Our financial results will be adversely impacted if our membership does not grow or if member retention does not improve and plan terminations do not decline.
If we are not able to maintain and enhance our brand, our business and operating results will be harmed.
The ongoing COVID-19 pandemic and public health crises, illness, epidemics or pandemics and the continued impact of remote work could adversely impact our business, operating results and financial condition.
Changes in our management and key employees could affect our business and financial results.
Our business may be harmed if we are not successful in executing on our strategic plans, including our growth strategy, cost-saving and enrollment quality initiatives.
Seasonality may cause fluctuations in our financial results, and if we are not successful in responding to changes in the seasonality of our business, our business, operating results and financial condition could be harmed.
The success of our customer care center operations depends upon our ability to timely hire, train, retain and ensure the productivity of our licensed health insurance agents.
We rely on multiple channels, including the Internet, telephone, mail, email, marketing partners and other channels, to market our services and to communicate with qualified prospects and our existing customers. If we are unable to successfully provide a relevant and reliable experience in a cost-effective manner to attract and convert such prospects into members for whom we receive commissions and retain our existing customers, our business, operating results and financial condition would be harmed. 
We rely significantly on marketing partners and our business and operating results would be harmed if we are unable to maintain effective relationships with our existing marketing partners or if we do not establish successful relationships with new marketing partners.
Our future operating results are likely to fluctuate and could fall short of expectations, which could negatively affect the value of our common stock. 
If commission reports we receive from carriers are inaccurate or not sent to us in a timely manner, our business and operating results could be harmed and we may not recognize trends in our membership.
We do not receive information about membership cancellations from our health insurance carriers directly, which makes it difficult for us to determine the impact of current conditions on our membership retention and to accurately estimate membership as of a specific date.
If our carrier advertising and sponsorship program are not successful, our business, operating results and financial condition could be harmed.
There are many risks associated with our operations in China.
Our success in selling Medicare-related health insurance will depend upon a number of factors some of which are outside of our control.
The marketing and sale of Medicare plans are subject to numerous, complex and frequently changing laws, regulations and guidelines, and non-compliance with or changes in laws, regulations and guidelines could harm our business, operating results and financial condition.
Changes and developments in the health insurance industry or system could harm our business, operating results and financial condition.
From time to time we are subject to various legal proceedings which could adversely affect our business.
Our success in selling health insurance is dependent in part on the actions of federal and state governments. Changes in the laws and regulations governing the offer, sale and purchase of health insurance could harm our business and operating results.
Our business is subject to security risks and, if we experience a successful cyberattack, a security breach or are otherwise unable to safeguard the confidentiality and integrity of the data we hold, including sensitive personal information, our business will be harmed. Our business is also subject to emerging privacy laws being passed at the state level that create unique compliance challenges.
Any legal liability, regulatory penalties, complaints or negative publicity related to the information on our website or that we otherwise provide could harm our business and operating results.
2




Our operating results will be impacted by factors that impact our estimate of the constrained LTV of commissions per approved member.
Our debt and preferred stock obligations contain restrictions that impact our business and expose us to risks that could materially adversely affect our liquidity and financial condition.
Operating and growing our business is likely to require additional capital, and if capital is not available to us, our business, operating results and financial condition may suffer.
Our ability to sell Medicare-related health insurance plans as a health insurance agent depends upon maintenance of functioning information technology systems.
System failures or capacity constraints could harm our business and operating results.
We may not be able to adequately protect our intellectual property, which could harm our business and operating results.
Consumers and our employees depend upon third-party service providers to access our website, services and systems, and our business and operating results could be harmed as a result of technical difficulties experienced by these service providers.
The price of our common stock has been and may continue to be volatile, and the value of your investment could decline.
Our Series A preferred stock has rights, preferences and privileges that are not held by, and are preferential to, the rights of our common stockholders, which could adversely affect our liquidity and financial condition, result in the interests of holders of our Series A preferred stock differing from those of our common stockholders and make an acquisition of us more difficult.
Our Risk Factors are not guarantees that no such conditions exist as of the date of this report and should not be interpreted as an affirmative statement that such risks or conditions have not materialized, in whole or in part.
3




PART I.    FINANCIAL INFORMATION

ITEM 1.    FINANCIAL STATEMENTS
EHEALTH, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, unaudited)
 June 30, 2022December 31, 2021
Assets
Current assets:
Cash and cash equivalents$194,741 $81,926 
Short-term marketable securities4,466 41,306 
Accounts receivable442 5,750 
Contract assets – commissions receivable – current201,315 254,821 
Prepaid expenses and other current assets9,633 23,784 
Total current assets410,597 407,587 
Contract assets – commissions receivable – non-current600,298 653,441 
Property and equipment, net9,750 12,105 
Operating lease right-of-use assets34,740 37,373 
Restricted cash3,239 3,239 
Other assets36,294 35,547 
Total assets$1,094,918 $1,149,292 
Liabilities, convertible preferred stock, and stockholders’ equity
Current liabilities:
Accounts payable$5,792 $13,750 
Accrued compensation and benefits11,010 16,458 
Accrued marketing expenses9,666 36,384 
Lease liabilities – current5,891 5,543 
Other current liabilities3,535 3,330 
Total current liabilities35,894 75,465 
Long-term debt65,403  
Deferred income taxes – non-current33,478 50,796 
Lease liabilities – non-current32,769 35,826 
Other non-current liabilities4,456 5,094 
Total liabilities172,000 167,181 
Commitments and contingencies
Convertible preferred stock247,337 232,592 
Stockholders’ equity:
Common stock40 39 
Additional paid-in capital767,164 755,875 
Treasury stock, at cost(199,998)(199,998)
Retained earnings108,225 193,213 
Accumulated other comprehensive income150 390 
Total stockholders’ equity675,581 749,519 
Total liabilities, convertible preferred stock, and stockholders’ equity$1,094,918 $1,149,292 



The accompanying notes are an integral part of these condensed consolidated financial statements.
4




EHEALTH, INC. 
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS
(in thousands, except per share amounts, unaudited)
Three Months Ended
 June 30,
Six Months Ended
 June 30,
2022202120222021
Revenue:  
Commission$47,835 $89,823 $141,685 $216,875 
Other2,574 6,734 13,974 13,896 
Total revenue50,409 96,557 155,659 230,771 
Operating costs and expenses:
Cost of revenue423 246 296 1,242 
Marketing and advertising29,963 44,581 88,417 95,455 
Customer care and enrollment29,149 38,362 71,313 72,524 
Technology and content17,780 20,464 37,443 43,627 
General and administrative17,198 18,118 37,185 41,172 
Amortization of intangible assets 119  295 
Restructuring and reorganization charges1,369  6,192 2,431 
Total operating costs and expenses95,882 121,890 240,846 256,746 
Loss from operations(45,473)(25,333)(85,187)(25,975)
Other income (expense), net(1,167)172 (2,188)322 
Loss before income taxes(46,640)(25,161)(87,375)(25,653)
Benefit from income taxes(9,138)(6,752)(17,131)(6,444)
Net loss(37,502)(18,409)(70,244)(19,209)
Paid-in-kind dividends for preferred stock(4,771)(3,082)(9,488)(3,082)
Change in preferred stock redemption value(2,756)(1,397)(5,257)(1,397)
Net loss attributable to common stockholders$(45,029)$(22,888)$(84,989)$(23,688)
 
Net loss per share attributable to common stockholders:
Basic and diluted$(1.65)$(0.86)$(3.12)$(0.89)
Weighted-average number of shares used in per share amounts:
Basic and diluted27,276 26,677 27,283 26,639 
Comprehensive loss:
Net loss$(37,502)$(18,409)$(70,244)$(19,209)
Unrealized holding loss for available for sales debt securities, net of tax(10)(35)(2)(51)
Foreign currency translation adjustments(261)59 (238)42 
Comprehensive loss$(37,773)$(18,385)$(70,484)$(19,218)

The accompanying notes are an integral part of these condensed consolidated financial statements.
5




EHEALTH, INC.
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(in thousands, unaudited)

Three Months Ended June 30, 2022
 Common StockAdditional Paid-in
Capital
Treasury StockRetained EarningsAccumulated Other Comprehensive IncomeTotal Stockholders’ Equity
 SharesAmountSharesAmount
Balance as of March 31, 202238,880 $39 $762,212 12,053 $(199,998)$153,253 $421 $715,927 
Issuance of common stock in connection with equity incentive plans530 1 — — — — — 1 
Repurchase of shares to satisfy employee tax withholding obligations— — (1,926)234 — — — (1,926)
Paid-in-kind dividend and accretion related to convertible preferred stock— — — — — (7,526)— (7,526)
Issuance of common stock for employee stock purchase program83 — 873 — — — — 873 
Stock-based compensation— — 6,005 — — — — 6,005 
Other comprehensive loss, net of tax— — — — — — (271)(271)
Net loss— — — — — (37,502)— (37,502)
Balance as of June 30, 202239,493 $40 $767,164 12,287 $(199,998)$108,225 $150 $675,581 
Three Months Ended June 30, 2021
 Common StockAdditional Paid-in
Capital
Treasury StockRetained EarningsAccumulated Other Comprehensive IncomeTotal Stockholders’ Equity
 SharesAmountSharesAmount
Balance as of March 31, 202137,993 $38 $728,213 11,912 $(199,998)$315,355 $317 $843,925 
Issuance of common stock in connection with equity incentive plans63 — 517 — — — — 517 
Repurchase of shares to satisfy employee tax withholding obligations— — (870)13 — — — (870)
Paid-in-kind dividend and accretion related to convertible preferred stock— — — — — (4,479)— (4,479)
Issuance of common stock for employee stock purchase program38 — 2,248 — — — — 2,248 
Stock-based compensation— — 8,798 — — — — 8,798 
Other comprehensive income, net of tax— — — — — — 24 24 
Net loss— — — — — (18,409)— (18,409)
Balance as of June 30, 202138,094 $38 $738,906 11,925 $(199,998)$292,467 $341 $831,754 

The accompanying notes are an integral part of these condensed consolidated financial statements.
6




EHEALTH, INC.
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(in thousands, unaudited)

Six Months Ended June 30, 2022
 Common StockAdditional Paid-in
Capital
Treasury StockRetained EarningsAccumulated Other Comprehensive IncomeTotal Stockholders’ Equity
 SharesAmountSharesAmount
Balance as of December 31, 202138,704 $39 $755,875 12,016 $(199,998)$193,213 $390 $749,519 
Issuance of common stock in connection with equity incentive plans706 1 1,054 — — — — 1,055 
Repurchase of shares to satisfy employee tax withholding obligations— — (2,434)271 — — — (2,434)
Paid-in-kind dividend and accretion related to convertible preferred stock— — — — — (14,744)— (14,744)
Issuance of common stock for employee stock purchase program83 — 873 — — — — 873 
Stock-based compensation— — 11,796 — — — — 11,796 
Other comprehensive loss, net of tax— — — — — — (240)(240)
Net loss— — — — — (70,244)— (70,244)
Balance as of June 30, 202239,493 $40 $767,164 12,287 $(199,998)$108,225 $150 $675,581 
Six Months Ended June 30, 2021
 Common StockAdditional Paid-in
Capital
Treasury StockRetained EarningsAccumulated Other Comprehensive IncomeTotal Stockholders’ Equity
 SharesAmountSharesAmount
Balance as of December 31, 202037,755 $38 $721,013 11,831 $(199,998)$316,155 $350 $837,558 
Issuance of common stock in connection with equity incentive plans301 — 802 — — — — 802 
Repurchase of shares to satisfy employee tax withholding obligations— — (5,907)94 — — — (5,907)
Paid-in-kind dividend and accretion related to convertible preferred stock— — — — — (4,479)— (4,479)
Issuance of common stock for employee stock purchase program38 — 2,248 — — — — 2,248 
Stock-based compensation— — 20,750 — — — — 20,750 
Other comprehensive loss, net of tax— — — — — — (9)(9)
Net loss— — — — — (19,209)— (19,209)
Balance as of June 30, 202138,094 $38 $738,906 11,925 $(199,998)$292,467 $341 $831,754 

The accompanying notes are an integral part of these condensed consolidated financial statements.
7




EHEALTH, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS 
(in thousands, unaudited)
Six Months Ended
 June 30,
 20222021
Operating activities:
Net loss$(70,244)$(19,209)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization2,037 2,202 
Amortization of internally developed software8,090 5,739 
Amortization of intangible assets 295 
Stock-based compensation expense10,790 19,647 
Deferred income taxes(17,316)(7,392)
Other non-cash items1,129 779 
Changes in operating assets and liabilities:
Accounts receivable5,309 (1,736)
Contract assets – commissions receivable106,616 37,007 
Prepaid expenses and other assets14,656 4,317 
Accounts payable(7,911)(21,416)
Accrued compensation and benefits(4,614)(3,709)
Accrued marketing expenses(26,715)(7,647)
Deferred revenue780 1,056 
Accrued expenses and other liabilities(1,261)793 
Net cash provided by operating activities21,346 10,726 
Investing activities:
Capitalized internal-use software and website development costs(8,376)(7,342)
Purchases of property and equipment and other assets(227)(2,705)
Purchases of marketable securities(8,402)(67,811)
Proceeds from redemption and maturities of marketable securities45,269 41,514 
Net cash provided by (used in) investing activities28,264 (36,344)
Financing activities:
Proceeds from issuance of preferred stock, net of issuance costs 214,025 
Net proceeds from debt financing64,862  
Net proceeds from exercise of common stock options and employee stock purchases1,054 3,051 
Repurchase of shares to satisfy employee tax withholding obligations(2,434)(5,907)
Principal payments in connection with leases(64)(76)
Net cash provided by financing activities63,418 211,093 
Effect of exchange rate changes on cash, cash equivalents and restricted cash(213)26 
Net increase in cash, cash equivalents and restricted cash112,815 185,501 
Cash, cash equivalents and restricted cash at beginning of period85,165 47,113 
Cash, cash equivalents and restricted cash at end of period$197,980 $232,614 


 The accompanying notes are an integral part of these condensed consolidated financial statements.
8





EHEALTH, INC. 
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)

Note 1Summary of Business and Significant Accounting Policies

Description of Business – eHealth, Inc. (the “Company,” “eHealth,” “we” or “us”) is a leading health insurance marketplace with a technology and service platform that provides consumer engagement, education and health insurance enrollment solutions. Our mission is to connect every person with the highest quality, most affordable health insurance and Medicare plans for their life circumstances. Our platform integrates proprietary and third-party developed educational content regarding health insurance plans with decision support tools to aid consumers in what has traditionally been a confusing and opaque health insurance purchasing process, and to help them obtain the health insurance products that meet their individual health and economic needs. Our omnichannel consumer engagement platform enables consumers to use our services online, through interactive chat, or by telephone with a licensed insurance agent. We have created a marketplace that offers consumers a broad choice of insurance products that includes thousands of Medicare Advantage, Medicare Supplement, Medicare Part D prescription drug, individual and family, small business and other ancillary health insurance products from approximately 200 health insurance carriers across all fifty states and the District of Columbia.

Basis of Presentation – The accompanying condensed consolidated balance sheet as of June 30, 2022, the condensed consolidated statements of comprehensive loss and stockholders’ equity for the three and six months ended June 30, 2022 and 2021, and the condensed consolidated statements of cash flows for the six months ended June 30, 2022 and 2021 are unaudited. The condensed consolidated balance sheet data as of December 31, 2021 was derived from the audited consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2021, which was filed with the Securities and Exchange Commission on March 1, 2022. The accompanying financial statements and related notes should be read in conjunction with the audited consolidated financial statements and related notes included in our Annual Report on Form 10-K.

The accompanying condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles ("U.S. GAAP") for interim financial information and reflect all normal recurring adjustments that are necessary to present fairly the results for the interim periods presented. The condensed consolidated financial statements include the accounts of eHealth, Inc. and its direct and indirect wholly-owned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. Certain information and disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted in accordance with those rules and regulations. Certain prior period amounts have been reclassified to conform with our current period presentation.

The unaudited condensed consolidated financial statements have been prepared on the same basis as the audited consolidated financial statements in our Annual Report on Form 10-K for the year ended December 31, 2021 and include all adjustments necessary for the fair presentation of our financial position as of June 30, 2022 and December 31, 2021, and our results of operations for the periods presented. The results for the three and six months ended June 30, 2022 are not necessarily indicative of the results to be expected for any subsequent period or for the year ending December 31, 2022 and therefore should not be relied upon as an indicator of future results.

Subsequent to the issuance of our consolidated financial statements for the year ended December 31, 2020, we identified certain errors, including a $3.0 million under-recognition of stock-based compensation expense and a $1.5 million over-recognition of licensing costs for the year ended December 31, 2020. We adjusted for these items in the first quarter of 2021 and the adjustments reduced our net loss by approximately $1.5 million, or $0.06 per basic and diluted share in our Condensed Consolidated Statement of Comprehensive Loss for the three months ended March 31, 2021. These items also reduced our net loss by approximately $1.5 million, or $0.06 per basic and diluted share, on our Condensed Consolidated Statement of Comprehensive Loss for the six months ended June 30, 2022. We evaluated the effects of these out-of-period adjustments, both qualitatively and quantitatively, and concluded that the errors and the correction thereof were immaterial both individually and in the aggregate to the current reporting period and the periods in which they originated, including quarterly reporting.

9





EHEALTH, INC. 
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
Significant Accounting Policies, Estimates and Judgments – The preparation of condensed consolidated financial statements and related disclosures in conformity with U.S. GAAP requires management to make estimates, judgments and assumptions that affect the amounts reported and disclosed in the condensed consolidated financial statements and accompanying notes. On an ongoing basis, we evaluate our estimates, including those related to, but not limited to, the useful lives of intangible assets, fair value of investments, recoverability of intangible assets, the commissions we expect to collect for each approved member cohort, valuation allowance for deferred income taxes, provision (benefit) for income taxes and the assumptions used in determining stock-based compensation. We base our estimates of the carrying value of certain assets and liabilities on historical experience and on various other assumptions that we believe to be reasonable. Actual results may differ from these estimates. There have been no material changes to our significant accounting policies discussed in our Annual Report on Form 10-K for the year ended December 31, 2021.

Seasonality – Open enrollment periods drive the seasonality of our business. A greater number of our Medicare-related health insurance plans are sold in our fourth quarter during the Medicare annual enrollment period when Medicare-eligible individuals are permitted to change their Medicare Advantage and Medicare Part D prescription drug coverage for the following year. As a result, our Medicare plan-related commission revenue is highest in our fourth quarter. Our Medicare plan-related commission revenue is also elevated in the first quarter compared to the second and third quarters as a result of the reintroduction of the Medicare Advantage open enrollment period in the first quarter of 2019. Any changes to or additional enrollment periods may change the seasonality of our business.

The majority of our individual and family health insurance plans are sold in the fourth quarter during the annual open enrollment period as defined under the federal Patient Protection and Affordable Care Act and related amendments in the Health Care and Education Reconciliation Act. In the states where the Federally Facilitated marketplace operates as the state health insurance exchange, individuals and families generally are not able to purchase individual and family health insurance outside of the annual enrollment period, unless they qualify for a special enrollment period as a result of certain qualifying events, such as losing employer-sponsored health insurance or moving to another state. Extended open enrollment or special enrollment periods may change the seasonality of our individual and family health insurance business. For example, the COVID-related special enrollment period which ended on August 15, 2021 caused increased commission revenue from the sale of individual and family health insurance plans outside of the open enrollment period.

Recently Adopted Accounting Pronouncements

We did not adopt any new accounting pronouncements during the six months ended June 30, 2022.



10





EHEALTH, INC. 
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
Note 2Revenue

Disaggregation of Revenue – The table below depicts the disaggregation of revenue by product and is consistent with how we evaluate our financial performance (in thousands):

Three Months Ended
 June 30,
Six Months Ended
 June 30,
2022202120222021
Medicare
Medicare Advantage$36,477 $69,142 $114,607 $172,667 
Medicare Supplement2,637 3,921 8,757 12,143 
Medicare Part D(462)(6,027)998 (4,291)
Total Medicare38,652 67,036 124,362 180,519 
Individual and Family (1)
Non-Qualified Health Plans2,369 11,076 3,979 14,443 
Qualified Health Plans745 2,838 2,261 4,938 
Total Individual and Family3,114 13,914 6,240 19,381 
Ancillary
Short-term977 1,513 2,320 3,269 
Dental703 3,660 1,534 5,388 
Vision253 934 496 1,139 
Other715 1,021 1,129 1,056 
Total Ancillary2,648 7,128 5,479 10,852 
Small Business2,423 2,290 5,906 5,513 
Commission Bonus and Other998 (545)(302)610 
Total Commission Revenue47,835 89,823 141,685 216,875 
Other Revenue
Sponsorship and Advertising Revenue2,091 6,023 12,735 11,837 
Other483 711 1,239 2,059 
Total Other Revenue2,574 6,734 13,974 13,896 
Total Revenue$50,409 $96,557 $155,659 $230,771 
_____________

(1)We define our Individual and Family plan offerings as major medical individual and family health insurance plans, which does not include Medicare-related, small business or ancillary plans. Individual and family health insurance plans include both qualified and non-qualified plans. Qualified health plans are individual and family health insurance plans that meet the requirements of the Affordable Care Act and are offered through the government-run health insurance exchange in the relevant jurisdiction. Non-qualified health plans are Individual and Family plans that meet the requirements of the Affordable Care Act and are not offered through the exchange in the relevant jurisdiction. Individuals that purchase non-qualified health plans cannot receive a subsidy in connection with the purchase of non-qualified plans.



11





EHEALTH, INC. 
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
Commission revenue by segment is presented in the table below (in thousands):
Three Months Ended
 June 30,
Six Months Ended
 June 30,
2022202120222021
Medicare
Commission Revenue from Members Approved During the Period$49,855 $78,598 $134,138 $193,276 
Net Commission Revenue from Members Approved in Prior Periods(1)
(10,788)(11,543)(10,737)(11,529)
Total Medicare Segment Commission Revenue$39,067 $67,055 $123,401 $181,747 
Individual, Family and Small Business
Commission Revenue from Members Approved During the Period$4,612 $5,208 $10,654 $11,603 
Commission Revenue from Renewals of Small Business Members During the Period2,044 1,723 5,081 4,410 
Net Commission Revenue from Members Approved in Prior Periods(1)
2,112 15,837 2,549 19,115 
Total IFP/SMB Segment Commission Revenue$8,768 $22,768 $18,284 $35,128 
Total Commission Revenue from Members Approved During the Period (1)
$54,467 $83,806 $144,792 $204,879 
Commission Revenue from Renewals of Small Business Members During the Period2,044 1,723 5,081 4,410 
Total Net Commission Revenue from Members Approved in Prior Periods (1)(2)
(8,676)4,294 (8,188)7,586 
Total Commission Revenue$47,835 $89,823 $141,685 $216,875 
_____________

(1)These amounts reflect our revised estimates of cash collections for certain members approved prior to the relevant reporting period that are recognized as adjustments to revenue within the relevant reporting period. The net adjustment revenue includes both increases in revenue for certain prior period cohorts as well as reductions in revenue for certain prior period cohorts.
(2)The impacts of total net commission revenue from members approved in prior periods were $(0.32) and $0.16 per basic and diluted share, for the three months ended June 30, 2022 and 2021, respectively. The impacts of total net commission revenue from members approved in prior periods were $(0.30) and $0.28 per basic and diluted share, for the six months ended June 30, 2022 and 2021, respectively.
The total reductions to revenue from members approved in prior periods were $13.7 million and $18.5 million for the three months ended June 30, 2022 and 2021, respectively, and $13.7 million and $19.4 million for the six months ended June 30, 2022 and 2021. These reductions to revenue primarily related to the Medicare segment.


Note 3Supplemental Financial Statement Information

Cash, Cash Equivalents and Restricted Cash

We consider all investments with an original maturity of 90 days or less from the date of purchase to be cash equivalents. Cash and cash equivalents are stated at fair value. We also invest in marketable securities that are measured and recorded at fair value. See Note 4Fair Value Measurements for further discussion about our marketable securities.

12





EHEALTH, INC. 
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
Our cash, cash equivalent and restricted cash balances are summarized as follows (in thousands):
June 30, 2022December 31, 2021
Cash$58,761 $33,253 
Cash equivalents135,980 48,673 
Cash and cash equivalents194,741 81,926 
Restricted cash3,239 3,239 
Total cash, cash equivalents and restricted cash$197,980 $85,165 

As of June 30, 2022 and December 31, 2021, we had $3.2 million of restricted cash which was classified as a non-current asset on our Condensed Consolidated Balance Sheets. This amount collateralizes letters of credit related to certain lease commitments.

Contract Assets and Accounts Receivable

We do not require collateral or other security for our contract assets and accounts receivable. We believe the potential for collection issues with any of our customers was minimal as of June 30, 2022.

We estimate an allowance for credit losses using relevant available information from internal and external sources, related to past events, current conditions, and reasonable and supportable forecasts. Specifically, for the purpose of measuring the probability of default parameters, we utilize Capital IQ’s, Standard & Poor’s and Moody’s analytics. Our estimates of loss given default are determined by using our historical collections data as well as historical information obtained through our research and review of other insurance related companies. Our estimated exposure at default is determined by applying these internal and external data sources to our commission receivable balances. As such, we apply an immediate reversion method and revert to historical loss information when computing our credit loss exposure. Credit loss expenses are assessed quarterly and included in general and administrative expense on our Condensed Consolidated Statement of Comprehensive Loss. There were no write-offs during the six month periods ended June 30, 2022 and 2021.

We considered the impact of recent events and global economic conditions when evaluating the appropriate adjustments to our allowance for credit losses as of June 30, 2022. We also considered the current and expected future economic and market conditions surrounding the COVID-19 pandemic.

The change in the allowance for credit losses for the six months ended June 30, 2022 is summarized as follows (in thousands): 
Beginning balance$2,198 
Change in allowance34 
Ending balance$2,232 


13





EHEALTH, INC. 
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
Our contract assets – commission receivable activities, net of credit loss allowances are summarized as follows (in thousands):
Six Months Ended June 30, 2022
Medicare SegmentIFP/SMB SegmentTotal
Beginning balance$837,474 $70,788 $908,262 
Commission revenue from members approved during the period134,138 10,654 144,792 
Commission revenue from renewals of small business members during the period 5,081 5,081