Exhibit 2
                                                                       ---------

               [THIRD POINT MANAGEMENT COMPANY L.L.C. LETTERHEAD]



January 13, 2004

Mr. Steven J. Shulman
Chief Executive Officer
Magellan Health Services Inc.
6950 Columbia Gateway Drive, Suite 400
Columbia, MD 21046

Dear Mr. Shulman:

Please be advised that certain entities controlled by Third Point Management
Company L.L.C have acquired a 7.6% stake in Magellan Health Services ("the
Company") amounting to 2,047,443 shares. We acquired this stake by accumulating
the senior subordinated debt securities of the company over the past six months
that were exchanged for equity when the company emerged from bankruptcy on
January 6, 2004.

At the time that we made our initial bond purchases in July (at prices
equivalent to $464 per $1,000 or approximately $14 per share on an exchanged
basis - excluding rights) we believed that significant growth opportunities
existed for the Company in the public segment and that new management had made
great strides in integrating and rationalizing what used to be an over-leveraged
roll-up. We were further impressed by the restructuring accomplishments made by
yourself and advisory firm, Houlihan, Lokey, Howard and Zukin.

Even after the significant appreciation in the Company's securities, we remain
optimistic about the Company's prospects and believe that the current valuation
of the Company is modest compared to its peers. A bounty of new potential state
business in 2004, a de-leveraged balance sheet that better enables the company
to bid for new public sector business, potential cost savings from systems
integration, a better than expected resolution regarding Tenncare, an improving
economy likely leading to lower member utilization of psychiatric services, and
an excellent management team lead us to our sanguine views.





Finally, we are delighted that as a significant investor, Onex Corporation
possesses a sound understanding of the business and will provide an active voice
on the Board.

We look forward to sharing in the Company's future success.

Very truly yours,

/s/ Daniel S. Loeb

Daniel S. Loeb