About Magellan Health, Inc.
Magellan Health is one of the largest managed behavioral health care companies in the US. The company manages mental health plan, employee assistance, and work/life programs through its nationwide third-party provider network. Magellan also provides radiology benefits management, specialty pharmaceutical management, and Medicaid management. Overall, it serves about 55 million members through contracts with federal and local government agencies, insurance companies, and employers. Magellan's Pharmacy Management segment's services include benefit management, dispensing, administration, clinical programs, medical pharmacy management, and care coordination.
Magellan operates through two primary business segments: Healthcare (which brings in over 65% of revenue) and Pharmacy Management (some 35% of revenue).
The Healthcare segment provides managed behavioral health care services and employee assistance program (EAP) services, as well as managing other specialty areas including diagnostic imaging and musculoskeletal health. It also provides the integrated management of physical, behavioral, and pharmaceutical health care for special populations through Magellan Complete Care (MCC).
Magellan's Pharmacy Management segment offers products and services to help its clients manage pharmacy benefit programs. It provides pharmacy benefit management (PBM) services, pharmacy benefit administration (PBA) for Medicaid and other government-sponsored programs, medical pharmacy management, and programs to integrate management of specialty drugs across medical and pharmacy benefits in complex cases.
Corporate segment of the Company is comprised primarily of amounts not allocated to the Healthcare and Pharmacy Management segments that are largely associated with costs related to being a publicly traded company.
Magellan Health operates about 55 offices in 24 states and Washington, DC. The Company's headquarters is located in Phoenix, Arizona. All of the company's revenue are generated from US and named to the Fortune 500 List of America's Largest Companies.
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Magellan's customers include health plans, employer groups, government and military agencies, labor unions, third-party administrators, and pharmaceutical manufacturers The government accounts for about 75% of total revenue, though.
The company has a network of health care providers, as well as a third-party network of facilities including psychiatric and substance abuse hospitals, partial hospitalization facilities, rehab centers, and community health centers.
Except in 2019, Magellan's revenues have been climbing upward over the past five years, but net income has been volatile from year to year.
In 2019 the company's revenue decreased 2% to $7.2 billion. This was primarily due to the $379 million decrease in PBM segment. This decrease is primarily due to terminated contracts of $325.8 million and decreased membership and utilization of $154.6 million, mainly due to a reduction in the Part D footprint.
Net income rose 131% to $56 million that year.
The company ended 2019 with $325.2 million in net cash, $52.9 million more than it had at the end of 2018. Operating activities provided $115.8 million, while investing activities used $19.5 million and financing activities used another $43.4 million.
Magellan is focused on measured growth while executing against a multi-year margin improvement plan for the current portfolio of customers to bring earnings in line with industry competitive levels. The Company's strategy is organized around four main focus areas:
Retaining customers and driving new sales: To drive revenue and profit growth long term, the Company has targeted plans to retain existing customers and add new customers across both segments. In Pharmacy Management and Healthcare, the Company is targeting growth through new business wins, increased retention and upselling existing and newly developed services to existing customers.
Improving margins by reducing cost of care, lowering Pharmacy costs of goods sold and driving operational improvements across the organization: Within Pharmacy Management, the Company will continue to grow PBM while retaining specialty carve-out contracts and lowering our cost of goods sold. Within Healthcare, the Company will execute against targeted medical action plans and will have market competitive loss ratios for each customer.
Maximizing and expanding Magellan's key value drivers (Pharmacy Management and Healthcare).
Engaging the Company's workforce: The Company will focus on talent acquisition, development and retention, as well as streamlining the Company's organizational structure.
William Fickling, once a star basketball player at Auburn University, started his career in his father's real estate office in Georgia. In 1969 Fickling founded Charter Medical as a holding company for the family's six nursing homes and one hospital. The company went public in 1971 as an owner/manager of general acute care hospitals. By the mid-1980s it had focused on psychiatric facilities and was adding addiction treatment centers to its portfolio.
The company went into Chapter 11 in 1991, emerging in 1992 with a plan to focus on behavioral health care; it also went public again. As part of its reorganization, Charter in 1995 bought Magellan Health Services and took that name. It also bought 51% of Green Spring Health Services, a managed care company specializing in mental health and substance abuse. (It bought the rest in 1998.)
4801 E Washington St STE 100
Phoenix, AZ 85034-2006
Phone: 1 (800) 642-1716
Employer Type: Publicly Owned
Stock Symbol: MGLN
Stock Exchange: , NASDAQ
CTO: Srinivas Koushik
CFO: Jonathan N. Rubin
Chairman and CEO: Barry M. Smith
Employees (This Location): 2,300
Employees (All Locations): 10,100
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