Escalating costs of medical and psychiatric care have prompted a reevaluation of the health care delivery system and practice styles. There are several "procompetition" or market-based solutions that seek to make the consumer of care more price conscious and the provider of care more cost conscious. Diagnosis-related groups (DRGs), preferred provider organizations (PPOs), the growth of for-profit hospital systems, and the expansion of health maintenance organizations (HMOs) are reshaping the organization and financing of psychiatric care. Psychiatry's adaptation to the new medical economics must emphasize the quality of patient care.