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  "documentTitle": "eHealth Inc. (EHTH)",
  "authorId": "51_Muddy_Waters",
  "authorName": "Carson Block",
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  "presentationDate": "2020-04-08 00:00:00",
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  "notes": "The slide uses tables to demonstrate that eHealth's churn assumptions imply unrealistically long customer lives, leading to an overstated commissions receivable balance.",
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      "text": "The net effect of this extra year of customer life on the books is that we estimate EHTH’s constrained LTV for MA members is overstated by 28.2%.",
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      "text": "Remaining Customer Life: 28.2%",
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      "text": "Apparently Sally Struthers Was Unavailable",
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      "text": "EHTH’s persistence assumptions for Medicare Supplement and Medicare Part D also look highly aggressive relative to churn from the 2018 and 2019 cohorts. For Medicare Supplement, EHTH churn implies a life of 4.3 years.",
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      "text": "In MA, for example, we calculate that EHTH uses 3.35 years of remaining life. This means that EHTH assumes its customers’ total lives are well above 3.35 years, due to the fact that the company’s book of business has already aged. We, on the other hand, model remaining life of 2.34 years, which is the mean of the implied lives of 2017 through 2019 MA cohort members. The net effect of this extra year of customer life on the books is that we estimate EHTH’s constrained LTV for MA members is overstated by 28.2%.",
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      "text": "We believe EHTH has taken advantage of its reliance on two statistical models, one for new members and one for aged members. As a result, we believe that the company significantly overstates the remaining customer life on its books in order to arrive at its $589 million commissions receivable balance.",
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      "text": "For Medicare Part D, EHTH churn indicates a life of 4.1 years.",
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      "text": "Table 3: eHealth Medicare Supplement Churn",
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      "text": "Table 5: Remaining Customer Life Estimate",
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      "text": "Table 4: eHealth Medicare Part D Churn",
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      "text": "Remaining Life = Total Life – Existing Customer Life",
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