The Medicare market continues to exhibit significant demographic tailwinds that offer sustainable, long-term growth and opportunities for carriers, agents, and marketing organizations. Recent examples of the attractiveness of the Medicare market include the Initial Public Offerings (“IPO”) of Select Quote, Inc. and GoHealth, Inc. Unless otherwise noted, the following information was taken from the Form S-1 Registration Statement, commonly referred to as the prospectus, that each company filed with the Securities and Exchange Commission (“SEC”) ahead of their IPO.
GoHealth
GoHealth is a leading health insurance marketplace whose mission is to improve access to healthcare in America. GoHealth’s proprietary technology platform leverages modern machine-learning algorithms powered by nearly two decades of insurance behavioral data to reimagine the optimal process for helping individuals find the best health insurance plan for their specific needs.
GoHealth’s IPO beat market expectations, with 43.5 million shares priced at $21, resulting in $913 million raised [1]. The offering originally estimated 39.5 million shares in a range of $18 to $20. Based on the stock price as of the market close on August 13, 2020, GoHealth has a total market capitalization of around $4.9 billion.
Key Financial & Sales Highlights from Prospectus
- $539.5 million net revenues for the Fiscal Year 2019
- Adjusted EBITDA of $170.0 million for Fiscal Year 2019
- Humana & Anthem accounted for approximately 42% and 32%, respectively of GoHealth net revenues during the First Quarter 2020
Approved Commissionable Submissions
| 1st Quarter 2020 | Fiscal Year 2019 | |
|---|---|---|
| Medicare Advantage | 115,895 | 348,706 |
| Medicare Supplement | 2,380 | 16,041 |
| Prescription Drug Plans | 2,655 | 21,513 |
| Total | 120,930 | 386,260 |
| 1st Quarter 2020 | Fiscal Year 2019 | |
|---|---|---|
| Medicare Advantage | $857 | $978 |
| Medicare Supplement | $920 | $957 |
| Prescription Drug Plans | $215 | $206 |
[1] https://www.pymnts.com/news/ipo/2020/gohealth-surges-after-ipo-raises-more-than-913m/
SelectQuote
SelectQuote is a leading technology-enabled, direct-to-consumer (“DTC”) distribution platform that provides consumers with a transparent and convenient venue to shop for complex senior health, life and auto & home insurance policies from a curated panel of the nation’s leading insurance carriers.
SelectQuote’s IPO also beat market expectations with 18 million shares sold for $20, resulting in $360 million raised. In addition, existing shareholders sold 10.5 million shares at $20 as part of the IPO [1]. The offering targeted shares price range at $17 to $19 apiece. Based on the stock price as of the market close on August 13, 2020, SelectQuote has a market capitalization of around $3.2 billion.
Key Financial & Sales Highlights from Prospectus
- For the year ended June 30, 2019 (SelectQuote’s fiscal year ends June 30):
- $337.5 million in Total Revenue
- $105.3 million in Adjusted EBITDA
- Humana, UnitedHealthcare and Aetna accounted for 27%, 19% and 13% respectively of SelectQuote’s total revenues for the nine months ended March 31, 2020.
Approved Commissionable Submissions
| Nine Months ended March 31, 2020 | Fiscal Year ended June 30, 2019 | |
|---|---|---|
| Medicare Advantage | 171,099 | 107,665 |
| Medicare Supplement | 11,740 | 16,593 |
| Dental, Vision and Hearing | 38,992 | 28,643 |
| Prescription Drug Plans | 10,528 | 11,739 |
| Other | 2,596 | 4,102 |
| Total | 234,955 | 168,742 |
| Nine Months ended March 31, 2020 | Fiscal Year ended June 30, 2019 | |
|---|---|---|
| Medicare Advantage | $1,297 | $1,279 |
| Medicare Supplement | $1,372 | $1,312 |
| Dental, Vision and Hearing | $146 | $152 |
| Prescription Drug Plans | $229 | $267 |
| Other | $99 | $621 |