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Magellan Health (MGLN) Buys Bayless to Aid Behavioral Health
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Magellan Health, Inc. has acquired 70% interest in Bayless Integrated Healthcare, a leading integrated behavioral and primary care provider in Arizona.
This deal is in line with the company’s strategy to advance its collaborative care. It will also provide a scalable virtual platform to tap new markets and widen access to members in need.
Bayless is a perfect fit for Magellan Health given that the former is a niche player in integrated primary care and behavioral health area. The company expanded rapidly in recent years owing to solid payer relationships and the increasing staff strength, number of locations and patient demand.
The care provider has a rich tradition (more than 30 years) of serving the Medicaid population as a network provider for many of the managed care plan participants in Arizona’s Medicaid program.
With the purchase of principal stake in Bayless, Magellan Health will be able to dive into telehealth business, given that the former is designated as a URAC-accredited telehealth provider and offers telehealth services statewide in Arizona.
Usage of telehealth among behavioral health providers is a promising strategy to reduce the maldistribution of professionals and improve access to mental health and substance use disorder treatment across the United States.
Magellan Health expects the transaction to be neutral to slightly accretive to 2021 net income. Further, management will provide an update on the financial impact of the company’s provider strategy when it reports fourth-quarter 2020 earnings. Bayless will operate within Magellan Health’s Healthcare segment.
The Healthcare segment previously consisted of two reporting units, namely Behavioral & SpecialtyHealth and MCC. The company is on track to sell its MCC business to Molina Healthcare. This sale and the acquisition of interest in Bayless reflect the company’s endeavor to expand in the core areas of Behavioral & Specialty Health.
The Behavioral & Specialty Health is set to grow on the rising incidence of mental health disorders. Moreover, the behavioral health industry is extremely fragmented. Although there are organized main players in this market, bulk of the market is served by small-scale regional operators and professionals. In order to extend the reach of consumers, leading firms are also acquiring hospitals and comparable care facilities.
Magellan Health has inched up 1.8% year to date compared with its industry’s growth of 3.8%.
Other players in the same space, such as CVS Health Corp. (CVS - Free Report) and Centene Corp. (CNC - Free Report) have lost 9.5% and 7.7%, respectively, whereas Molina Healthcare, Inc. (MOH - Free Report) has gained 1.7%.
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market. Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2021.
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Magellan Health (MGLN) Buys Bayless to Aid Behavioral Health
Magellan Health, Inc. has acquired 70% interest in Bayless Integrated Healthcare, a leading integrated behavioral and primary care provider in Arizona.
This deal is in line with the company’s strategy to advance its collaborative care. It will also provide a scalable virtual platform to tap new markets and widen access to members in need.
Bayless is a perfect fit for Magellan Health given that the former is a niche player in integrated primary care and behavioral health area. The company expanded rapidly in recent years owing to solid payer relationships and the increasing staff strength, number of locations and patient demand.
The care provider has a rich tradition (more than 30 years) of serving the Medicaid population as a network provider for many of the managed care plan participants in Arizona’s Medicaid program.
With the purchase of principal stake in Bayless, Magellan Health will be able to dive into telehealth business, given that the former is designated as a URAC-accredited telehealth provider and offers telehealth services statewide in Arizona.
Usage of telehealth among behavioral health providers is a promising strategy to reduce the maldistribution of professionals and improve access to mental health and substance use disorder treatment across the United States.
Magellan Health expects the transaction to be neutral to slightly accretive to 2021 net income. Further, management will provide an update on the financial impact of the company’s provider strategy when it reports fourth-quarter 2020 earnings. Bayless will operate within Magellan Health’s Healthcare segment.
The Healthcare segment previously consisted of two reporting units, namely Behavioral & SpecialtyHealth and MCC. The company is on track to sell its MCC business to Molina Healthcare. This sale and the acquisition of interest in Bayless reflect the company’s endeavor to expand in the core areas of Behavioral & Specialty Health.
The Behavioral & Specialty Health is set to grow on the rising incidence of mental health disorders. Moreover, the behavioral health industry is extremely fragmented. Although there are organized main players in this market, bulk of the market is served by small-scale regional operators and professionals. In order to extend the reach of consumers, leading firms are also acquiring hospitals and comparable care facilities.
Magellan Health has inched up 1.8% year to date compared with its industry’s growth of 3.8%.
Other players in the same space, such as CVS Health Corp. (CVS - Free Report) and Centene Corp. (CNC - Free Report) have lost 9.5% and 7.7%, respectively, whereas Molina Healthcare, Inc. (MOH - Free Report) has gained 1.7%.
Magellan Health carries a Zacks Rank #3 (Hold), currently. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2021.
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