With the rise of managed healthcare, psychologists face new challenges to their professional ethics. This article examines the dilemmas posed by managed care in three areas: client care; the handling of patient data; and issues surrounding membership in a managedhealthcare organization. Case examples of ethical dilemmas and strategies for dealing with these challenges are presented. In an attempt to summarize the strategies used to cope with the ethical dilemmas presented in the case examples, global solutions for the ethical practice of psychology in a managedcare framework are also reviewed. These strategies include: understanding managed-care policies, clear communication with the client, additional training, increased advocacy by clinicians, and ultimately, psychologists' involvement in the formation of these organizations.Within the United States, there has been a proliferation of managed-care insurance providers and it is believed that the number of subscribers and providers will continue to increase in the future (Austad & Hoyt, 1992). As outlined by Blum (1992), managed-care systems generally have three goals: (1) to eliminate unnecessary services, (2) reduce cost, and (3) maintain or even increase effectiveness.