Magellan Health Services (MGLN)

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Top Contributors Yatin Suneja

COMPANY OVERVIEW Magellan Health Solutions is a specialty managed healthcare company offering an array of management services to health plans, insurance companies, corporations, labor unions, and carious government entities comprising more than 62 million members. Services offered by the company fall broadly into three categories: (1) managed behavioral healthcare, which encompasses both commercial and public sector contracts, (2) radiology benefits management, and (3) specialty pharmaceutical management.

Magellan offers its services to health care payers on either an at-risk or ASO (administrative services only) arrangement. Under at-risk contracts, Magellan assumes responsibility for the cost of providing treatment services in exchange for a fixed monthly fee. Under ASO contracts, Magellan provides an array of support services on a fee-for-services basis, such as utilization review, claims administration, and provider network management, but does not assume responsibility for the actual cost of treatment. Magellan also offers employee assistance programs (EPSs) in which the company provides short-term counseling.

Segment Overview

Magellan offers its services to health care payers on either an at-risk or ASO (administrative services only) arrangement. Under at-risk contracts, Magellan assumes responsibility for the cost of providing treatment services in exchange for a fixed monthly fee. Under ASO contracts, Magellan provides an array of support services on a fee-for-services basis, such as utilization review, claims administration, and provider network management, but does not assume responsibility for the actual cost of treatment. Magellan also offers employee assistance programs (EPSs) in which the company provides short-term counseling.

Managed Behavioral Healthcare

Magellan’s managed behavioral healthcare business provides coordination and management of the delivery of behavioral healthcare treatment services that are contracted through the company’s network of third-party treatment provides, including psychiatrists, psychologists, psychiatric hospitals, and residential treatment centers. With the exception of 24 facilities obtained through the company’s contact with the Maricopa County Behavioral Health Authority, which are in the process of being divested, Magellan does not own or operate treatment facilities, but rather contracts with behavioral health providers at favorable reimbursement rates.

Magellan provides managed behavioral healthcare service to the customers, through the following two segments

Commercial: The segment represents the services provided under the contract with managed care companies, health insurers and other health plans, Medicaid and Medicare members, as well as with employers, including corporation and governmental agencies and labor unions.

Public Sector: The segment represents the services provided to Medicaid recipients under contract with state and local governmental agencies.

Radiology Benefits Management

Magellan entered the radiology benefits management sector in January of 2006 through the acquisition of National Imaging Associates (NIA). The company’s Radiology Benefits Management segment manages the delivery of diagnostic imaging services on behalf of health plans to ensure that usage of imaging is both clinically appropriate and cost effective.

Specialty Pharmaceutical Management

Magellan entered the Specialty Pharmaceutical Management sector in July of 2006 through the acquisition of ICORE Healthcare, LLC. Magellan’s Specialty Pharmaceutical Management segment distributes and manages high-cost drugs used in the treatment of serious, chronic medical conditions, including cancer, multiple sclerosis, hemophilia, infertility, rheumatoid arthritis, and hepatitis, among others.

 Magellan Health Services

	Select All  |  Select None Metrics Revenue by Geography - International Revenue by Geography - Europe Revenue by Geography - Asia Revenue by Geography - Africa Revenue by Geography - South America Gross Profit Net Income Operating Income Total Premiums Health Care Premiums Total Customers Medicare Customers Medicaid Customers Risk-based Customers Fee-based Customers Medical Loss Ratio Administrative Cost Ratio Premiums from Commercial Customers Revenue Revenue by Geography - United States Net Investment Income Net Income Margin Premiums from Medicare Premiums from Medicaid Cancel

	Select All  |  Select None Companies Aetna (AET) AMERIGROUP (AGP) Centene (CNC) Coventry Health Care (CVH) I-TRAX (DMX) Health Net (HNT) Healthspring (HS) Metropolitan Health Networks (MDF) Magellan Health Services (MGLN) MOLINA HEALTHCARE (MOH) Sierra Health Services (SIE) Wellcare Group (WCG) UnitedHealth Group (UNH) WellPoint Health Networks (WLP) Humana (HUM) CIGNA Corporation (CI) UNIVERSAL AMERICAN CORP (UAM) Cancel

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Company	Data From	Revenue	Revenue by Geography - United States	Net Investment Income	Net Income Margin	Premiums from Medicare	Premiums from Medicaid
AMERIGROUP (AGP)	2007	$3.95B[1]	$3.95B[1]	$73.3M[1]	3%[1]	Add	Add
Centene (CNC)	2007	$2.92B[2]	$2.92B[2]	$25.2M[2]	3%[2]	Add	$2.67B[3]
Coventry Health Care (CVH)	2007	$9.88B[4]	$9.88B[4]	Add	6%[4]	$2.87B[5]	$1.11B[5]
Healthspring (HS)	2007	$1.57B[6]	$1.57B[6]	$23.9M[6]	5%[6]	$1.48B[7]	Add
Magellan Health Services (MGLN)	2007	$2.16B[8]	Add	Add	4%[8]	Add	Add

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[edit] References

1. ↑ ^{1.0 1.1 1.2 1.3} AGP,2007,10-K,Item-6,Page-41
2. ↑ ^{2.0 2.1 2.2 2.3} CNC,2007,10-K,Item-6,Page-27
3. ↑ CNC,2007,10-K,Item-15,Page-62
4. ↑ ^{4.0 4.1 4.2} CVH,2007,10-K,Item-8,Page-47
5. ↑ ^{5.0 5.1} CVH,2007,10-K,Item-7,Page-48
6. ↑ ^{6.0 6.1 6.2 6.3} HS,2007,10-K,Item-8,Page-63
7. ↑ HS,2007,10-K,Item-6,Page-35
8. ↑ ^{8.0 8.1} MGLN,2007,10-K,Item-6,Page-39