We have obviously entered a new world of psychiatry in which fiscal considerations come first. Some of the uncertainties of five years ago are matters of fact today. Length of stay is shifting, and beds are closing all over the country. Psychiatrists' capacity to work in concert to improve the prospects for a profession whose scientific base of operation is being eroded and abrogated is rapidly deteriorating.A description of the ways in which psychiatrists work with, for, around, and against managed care companies reveals that psychiatry is not a urntary profession, nor are psychiatrists dealt with in a way that indicates there is a stable foundation upon which to build psychiatry's future participation in managed care. Unlike medicine and surgery, where many of the diagnostic categories clearly define how a disorder is treated, what resources it takes, and how those resources have to be used, psychiatry is often inexact. Furthermore, there is a pervasive sense that others can do the job as well as, if not better than, psychiatrists can. This perception undermines our capacity to negotiate and our confidence that we have something important to sell.Trainees are now faced with learning methods of managed care and choosing paths that will ease the pain for them as they move into practice settings in which they must work closely with, if not for, managed care companies. Training for residents should continue to follow the high road, teaching biopsychosocial evaluation and treatment and continuity of care that allows patients to get well and stay well. Those principles should not be damaged as we move toward a more efficient and more highly controlled and regulated system of care in which psychiatrists can and, we hope, will play an important part over the years to come.