Profile: Magellan Health Inc (MGLN.O)
19 Dec 2014
Magellan Health Inc. (Magellan), formerly Magellan Health Services, Inc., incorporated on August 11, 1969, is engaged in the healthcare management business. The Company provides services to health plans, managed care organizations (MCOs), insurance companies, employers, labor unions, military and governmental agencies, third party administrators, and brokers. The Managed Healthcare business of the Company consists of management of behavioral healthcare services and the integrated management of physical and behavioral healthcare for special populations. The Specialty Solutions business consists of delivery of diagnostic imaging (radiology benefits management or RBM) and a variety of other specialty areas. The Pharmacy Management business comprises products and solutions that provide clinical and financial management of drugs paid under medical and pharmacy benefit programs.
The managed healthcare business (previously referred to as the managed behavioral healthcare business) of the Company consists of management of behavioral healthcare services and the integrated management of physical and behavioral healthcare for special populations, delivered through Magellan Complete Care (MCC). The Company's coordination and management of behavioral healthcare includes services provided through its network of behavioral health professionals, clinics, hospitals and ancillary service providers. This network is integrated with clinical and quality improvement programs for individuals in need of care, while at the same time managing the cost of these services. The treatment services provided through the Company's provider network include outpatient programs, such as counseling or therapy, intermediate care programs, such as intensive outpatient programs and partial hospitalization services, inpatient treatment and crisis intervention services. The Company generally does not directly provide or own any provider of treatment services, although it does employ licensed behavioral health counselors to deliver non-medical counseling under certain government contracts. The Company's integrated management of physical and behavioral healthcare includes its full service health plans which provide for the holistic management of special populations. These special populations include individuals with serious mental illness, dual eligibles, those eligible for long term care, intellectually and developmentally disabled individuals, and other populations with unique and often complex healthcare needs. The Company provides its management services primarily through risk-based products, where the Company assumes all or a substantial portion of the responsibility for the cost of providing treatment services in exchange for a fixed per member per month fee, administrative services only (ASO) products, where the Company provides services such as utilization review, claims administration and/or provider network management, but does not assume responsibility for the cost of the treatment services, and employee assistance programs (EAPs) where the Company provides short-term outpatient behavioral counseling services.
The Managed Healthcare Commercial segment (Commercial) generally reflects managed behavioral healthcare services and EAP services provided under contracts with health plans, insurance companies and MCOs for some or all of their commercial, Medicaid and Medicare members, as well as with employers, including corporations, governmental agencies, and labor unions. Commercial's contracts encompass risk-based, ASO and EAP arrangements. As of December 31, 2013, Commercial's covered lives were 4.0 million, 13.5 million and 13.0 million for risk-based, ASO and EAP products, respectively.
The Managed Healthcare Public Sector segment (Public Sector) generally reflects the management of behavioral health services provided to recipients under Medicaid and other state sponsored programs under contracts with state and local governmental agencies, and the integrated management of physical, behavioral and pharmaceutical care for special populations covered under Medicaid and other government sponsored programs. Public Sector contracts encompass either risk-based or ASO arrangements. As of December 31, 2013, Public Sector's covered lives were 2.1 million and 1.7 million for risk-based and ASO products, respectively.
The Specialty Solutions segment generally reflects the management of the delivery of diagnostic imaging (radiology benefits management or RBM) and a variety of other specialty areas such as radiation oncology, obstetrical ultrasound, cardiology and pain management, including spine surgery and musculoskeletal management, to ensure that such services are clinically appropriate and cost effective. The Company's Specialty Solutions services are currently provided under contracts with health plans and insurance companies for some or all of their commercial, Medicaid and Medicare members. The Company also contracts with state and local governmental agencies for the provision of such services to Medicaid recipients. The Company offers its Specialty Solutions services through risk-based contracts, where the Company assumes all or a substantial portion of the responsibility for the cost of providing services, and through ASO contracts, where the Company provides services such as utilization review and claims administration, but does not assume responsibility for the cost of the services. As of December 31, 2013, covered lives for Specialty Solutions were 5.7 million and 12.0 million for risk-based and ASO products, respectively. This segment was previously defined as Radiology Benefits Management; however, as it has grown and expanded to include additional products, the Company has renamed the segment Specialty Solutions to encompass all of its additional product offerings.
The Pharmacy Management segment comprises products and solutions that provide clinical and financial management of drugs paid under medical and pharmacy benefit programs. Pharmacy Managements' services include traditional pharmacy benefit management (PBM) services, pharmacy benefit administration (PBA for state Medicaid and other government sponsored programs, specialty pharmaceutical dispensing operations, contracting and formulary optimization programs, medical pharmacy management programs, and programs for the integrated management of drugs that treat complex conditions, regardless of site of service, method of delivery, or benefit reimbursement. In addition, the Company has a subcontract arrangement to provide PBM services on a risk basis for one of Public Sector's customers, which is scheduled to terminate on March 31, 2014. The Company's Pharmacy Management programs are provided under contracts with health plans, employers, Medicaid MCOs, state Medicaid programs, and other government agencies, and encompass risk-based and fee-for-service (FFS) arrangements. During 2013, Pharmacy Management processed 1.9 million adjusted commercial network claims in the Company's PBM business, which includes Partners Rx claims following the closing of the acquisition on October 1, 2013. As of December 31, 2013, the Company had a generic dispensing rate of 82.3% within its commercial PBM business. In addition, the Company processed 67.1 million adjusted PBA claims and 0.1 million specialty dispensing claims. Adjusted claim totals apply a multiple of three for each 90-day and traditional mail claim. In addition, as of December 31, 2013, Pharmacy Management served 0.4 million commercial PBM members, 9.5 million members in its medical pharmacy management programs, and 25 states and the District of Columbia in its PBA business.
Magellan Health Inc
55 Nod Road
AVON CT 06001