Magellan Health CMO Dr. Caroline Carney on Value-Based Care’s Progress, Parity and Behavioral Health Innovation

Magellan Health, a health plan focused on special populations, has been on the cutting edge of value-based care contracting in the mental health space.

The organization has inked several high-profile value-based care contracts through its managed care subsidiary, Magellan Healthcare. These include a deal with autism providers Kyo Autism and Invo Healthcare

“We’re believers in value-based care,” Dr. Caroline Carney, president of behavioral health and chief medical officer of Magellan Health, told Behavioral Health Business. “Early in the process, we started using value-based care in behavioral health to work with facilities and large provider groups around … evidence-based metrics.”


Magellan Health was acquired by large insurer Centene Corporation (NYSE: CNC) in 2022 for $2.2 billion. Its subsidiary, Magellan Healthcare, serves as its behavioral and related services division. Magellan Healthcare covers 19.5 million lives and has more than 1,000 employer contracts. 

BHB sat down with Carney to discuss the future of value-based care, parity and measurement-informed care. Highlights from that conversation are below, edited for length and style.

BHB: How has the value-based care space evolved within behavioral health over the last year?

Carney: We began value-based contracts to incentivize providers to perform better on measures like following up from inpatient hospitalization or providing the proper care to someone on an antipsychotic.


Our network and analytics team worked very closely to create a dashboard of metrics that we rolled out initially with inpatient providers to ensure that the follow-up care and transition of care was done well. Over time, we broadened our net to include outpatient providers. When we first started, it was upside only. We would incent providers with upside bonuses. We have not really gotten into the downside in terms of what we’re doing with value-based care, but that would ultimately be the goal.

With upside measures, we have seen a huge increase in group engagement quality. We are happy to deliver incentive checks. We think very firmly that value-based programs do the right thing in the market when they are predicated on the right set of measures and the right incentives.

What outcomes do you look at for value-based care? Is it different for every partnership?

Primarily, the outcomes will be similar, and the reason for that is you need to have something to rank it against. It’s particularly effective to use value-based care transparently. If I have the same set of metrics for hospital systems A, B and C, then I can use those data to compare which of these facilities – or systems, or groups – is delivering higher-quality and better care. Then we are more willing to contract and give higher rates to facilities that are engaging in high-quality care, as opposed to organizations that are not.

There are two defaults that providers often say: “Oh, my patients are sicker than everybody else’s.” And, “You have to pay me more; you aren’t paying me enough.”

If I can go to an organization that’s in the same community with the same kind of patients and say that Hospital A has quality rates up here, while showing that organization that their rates are down here, I can then start a conversation.

I can tell them: “I’m happy to pay you more if you can get your quality rates up here, because it has to be not about the money but outcomes for the patients.”

Does that also push measurement-based care? I would think they would go hand in hand.

Absolutely. So, some measurements are based on whether a patient got a lab done or had a follow-up visit. Others are using measurement-informed care.

We believe that measurement-informed care is very important and a critical component to follow. Magellan has engaged in developing collaborative care models and implementing those models. They are predicated on measurement-informed care, which guides and directs a pathway of getting evidence-based treatment to individuals.

So, measurement-informed care is very challenging on the individual provider level. The reason is that what Magellan may think is the right set of measures for a provider to follow may be different from what Optum thinks, or different from what Aetna and Cigna think. It puts those providers in a position to answer to several masters.

While we’re very supportive of measurement-informed care, particularly in separate programs like collaborative care, we need to work closely with the federal government, the state governments and other plans to holistically align around those key metrics.

What part of behavioral health do you think is most ripe for innovation?

I would bucket that into several areas. In terms of treatment and innovation, it would be around new therapies being brought to market, weighing the innovation against the safety and practicality, and ensuring those therapies are not abused.

Something that comes to mind with that model is the use of psychedelics, for instance. A lot of work is being done and there’s a lot of pressure to approve [psychedelices], but there is a very limited amount of science at this time. So, it’s finding the right balance in moving forward with novel therapies.

The second bucket is going back to measurement-informed care. How do we understand that quality care is being delivered? You might love your therapists because when you talk to your therapist, it’s like talking to your best friend. That doesn’t mean you have the right intervention needed to change your problem in the long run. Therapy is supposed to be hard.

I sit on the National Advisory Council for Healthcare Research and Quality, and that is one of the things we are tackling: How do we think about quality measurement in behavioral health, whether it’s therapy or the right level of care?

The third thing that is top of mind, and Magellan strongly supports, is the need for parity. I do want to say that we need to be careful about loosening parity so much, as it allows individuals to get non-evidence-based care, or it potentially opens the door to waste, abuse and fraud while driving up the cost of medically unnecessary care. That’s care that, frankly, does not support the tenants of behavioral health, which is the least reactive side of care. It also needs to include patient safety.

It’s a line that we need to walk to ensure that individuals have access and availability to high-quality care but do not become victims to costs, poor quality and unsafe care.

Are there any pieces of legislation or regulatory changes that you will be closely watching that could impact the behavioral health industry?

Parity is the biggest one. But also one of the things that came out of the horrible state that we were in with COVID was the recognition of the need for services, particularly those for adolescents and young adults. We’ve been closely paying attention to how our federal and state legislators are putting forward funds to be directed in different ways and for different types of services that might not have previously been available, mainly those services being delivered at the school level.

The second bucket is the funding that’s been directed towards continuing to fight the opioid epidemic and the use of fentanyl. We can’t just say that this is a problem of doctors overprescribing; this is a much broader problem now, and solving it needs to involve many more tactics.

The third is to see what happens around telehealth prescribing, particularly for medication-assisted therapy. We’ll be paying close attention to that.

We know that many patients want to return to face-to-face visits. The pendulum during COVID had to swing to a point where about 97% of our utilization was telehealth. It’s now swinging back to 50%. And our employers and health plans are hearing from their members and their enrollees that they want more access to face-to-face services.

My next and final thing that we’re paying close attention to is the legislation around collaborative care and the payment for collaborative care across the country. We are already in that space and delivering care through collaborative care, and we believe that it’s a very sound evidence-based model that we are hoping states get behind and Medicare already pays for. It’s at the state level that many don’t pay.

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