Well being insurer Centene Corp. plans to amass Magellan Well being in a $2.2 billion take care of the purpose of building a behavioral well being platform, the corporate stated in a U.S. Securities and Alternate Fee submitting. The acquisition comes as psychological well being challenges skyrocket amid the Covid-19 pandemic, and suppliers and payers alike concentrate on methods to enhance entry to behavioral healthcare.
Magellan Well being offers behavioral well being and worker help program companies, specialty well being and built-in care administration to well being plans, employers and the federal authorities. Additionally it is a pharmacy profit supervisor. With the acquisition, Centene plans to develop a behavioral well being platform for its 41 million members. The transfer reveals how psychological well being is not seen as a separate drawback to be identified and handled however quite a part of total persistent care administration.
“There’s a vital want for a essentially higher strategy to supporting folks with advanced, persistent circumstances by higher integration of bodily and psychological well being care,” stated Michael F. Neidorff, chairman, president and CEO of Centene, in a information launch. “This has grow to be much more evident in gentle of the pandemic which has pushed a dramatic rise in behavioral well being wants.”
The Covid-19 pandemic has thrown the necessity for accessible and reasonably priced psychological healthcare into sharp aid, with 41% of U.S. adults reporting that they skilled at the very least one hostile psychological or behavioral well being situation in June, in accordance with knowledge from the Facilities for Illness Management and Prevention. Insurers wish to set up partnerships that develop psychological well being companies for his or her members. In November, Aetna expanded its partnership with Inpathy, a web-based behavioral well being service, to supply members in 11 states entry to the service in-network.
Along with combining each Magellan Well being and Centene’s capabilities in behavioral well being, the acquisition will present extra scale for the payer’s specialty care division, enabling product improvement and new third-party relationships.
Magellan Well being will deliver 5.5 million new members on government-sponsored plans to Centene in addition to 18 million third-party buyer members that it offers specialty well being companies for. The transaction will add 2 million pharmacy advantages administration members and 16 million medical pharmacy members to Centene’s member base.
“This acquisition accelerates our diversification technique and enhances our means to construct subsequent technology capabilities in our specialty care enterprise by leveraging our scale and investments in know-how,” Neidorff stated.
Centene pays $95 per share in money for Magellan in a deal price $2.2 billion. The businesses anticipate to finish the transaction, which is topic to clearances and regulatory approvals, within the second half of 2021.
After the transaction, Magellan Well being will be part of Centene’s Well being Care Enterprises division. However it should proceed to independently help its current prospects and pursue development alternatives.
“By becoming a member of Centene below the Well being Care Enterprises umbrella, we’ll preserve the independence essential to make sure continued service to our third-party prospects whereas accelerating the introduction of modern options and reimagining behavioral well being,” Kenneth J. Fasola, CEO of Magellan Well being, stated in a information launch. “I stay up for persevering with to steer Magellan Well being as we create thrilling new alternatives for our prospects and staff who will profit from the creation of a best-in-class platform that meets our members’ wants at the moment and sooner or later.”
Fasola and different Magellan Well being leaders will stay of their roles and be part of Centene.
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