Behavioral Health Key to Elevance’s At-Risk Strategy

Behavioral health is at the heart of Elevance’s (NYSE:ELV) plans to increase its at-risk offerings.

Specifically, Elevance plans to focus on rolling out its Medicaid behavioral health offering focused on serious mental illness care.

“We have new offerings that are whole health full-risk opportunities, like assuming full-risk in oncology, as well as in Medicaid with behavioral health with the seriously mentally ill population,” Gail Boudreaux, president and CEO of Elevance, said during the company’s Q4 earnings call. “So, these are significant initiatives that are really propelling the trajectory of our business.”


Elevance has been interested in the behavioral health space for some time. In 2020, its health service division Carelon purchased behavioral health operator Beacon Health Options. It has since been rebranded to Carelon Behavioral Health. The organization has now integrated its services with physical health, social support and pharmacy services.

Elevance first discussed the SMI-focused program in its Q3 earnings call.

“We are also looking at taking full risks on the seriously mentally ill in behavioral health,” Peter Haytaian, executive vice president of Elevance Health and president of Carelon and CarelonRX, said. “When you think about these highly specialized areas of care, we’re not naive to think that we have the capabilities internally to handle all of it… we will be looking not only for partnerships but acquisitions that can help us in that regard.”


The new behavioral health offerings are poised to help boost Carelon’s growth trajectory in 2024.

Overall, the operating revenue of Carelon, which is comprised of CarelonRx and Carelon Services, was $12.4 billion in Q4 of 2023, an increase of 14% from Q4, 2022. Carelon’s operating revenue from the full 2023 year was $48 billion, a 16% year-over-year increase.

Elevance reported its 2023 operating revenue of $170 billion, up by 9.3% from 2022.

Elevance isn’t the only major payer looking at moving towards value-based and at-risk contracts for behavioral health care.

For example, special populations health plans Magellan Health, a Centene Corporation (NYSE: CNC) subsidiary, is looking for more measurement-based care as part of its move towards value-based care.

“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.”

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