These should be boom times for the companies that manage mental health benefits for insurers and large employers.

The number of Americans with mental health benefits has more than doubled in the last decade, and more people are seeking therapy as the stigma that once accompanied such care disappears. And of course there's stress galore. From 9/11 and anthrax to sniper attacks and an unsettled economy.

Yet, far from being flush with profits and promise, the $4.5 billion managed behavioral health care industry is in flux.

Some companies, including the largest, are having financial problems. Others say they are making money. Some psychiatrists and psychologists, frustrated by low fees and bureaucratic hassles, are leaving managed-care networks all together. Other providers, meanwhile, are joining them.

Among the defectors from the system is one of the largest mental health practices in the Washington area, a group associated with George Washington University Hospital. The group's decision last year meant 200 of its 1,000 patients had to find other therapists. Those who stayed had to pay for their visits themselves.

Market-leader Magellan Health Services Inc., which covers more than 68 million Americans, is more than $1 billion in debt. It recently told investors it may not be able to immediately repay its creditors. Experts in the field say they consider the decline of the Columbia company an aberration because it got overextended in an acquisition binge in recent years.

"Magellan simply hasn't raised rates fast enough," said Kenneth S. Abramowitz, a Carlyle Group analyst. He said the company was locked into too many long-term contracts and couldn't deal with the higher costs of more visits to therapists in the months after the Sept. 11, 2001, terrorist attacks.

Magellan acknowledges it has had "operational problems" but says its members have few problems finding providers. As its customer base has grown, so has its provider network, a spokesman said. The company now has about 4,500 psychiatrists, psychologists, social workers and other certified therapists for its 2.3 million members in the District, Maryland and Virginia alone.

Other large managed-care companies, such as United Behavioral Health (which covers about 21 million people), Falls Church-based ValueOptions Inc. (25 million) and PacifiCare Behavioral Health Inc. (4 million), say they are profitable. None of the three publicly reports financial results -- ValueOptions is privately held, and United and PacifiCare are subsidiaries of publicly traded companies.

The vast majority of Americans receiving mental health therapy are covered by managed-care plans, experts said. The explosion of mental health coverage over the past decade has brought with it a new approach to treatment as well as a host of new competitors. The number of Americans with access to mental health and employee assistance program benefits was about 86 million in 1993, according to Open Minds, a consulting firm. That number is now 227 million.

The managed-care approach requires therapists to submit treatment plans after initial visits with patients. But shaping a plan for someone with mental illness can be more challenging than treating a broken arm, experts say. And the concern among employers, insurers and middlemen like Magellan is that, without some scrutiny, too many people will want to unnecessarily see a therapist.

"There's this fear among managed-care companies that if you give people unlimited access to psychotherapeutic services that everybody is going to want to do long-term psychotherapy, that you're going to have the 'worried well' getting into psychoanalysis for years and years and years," said Daniel Z. Lieberman, a psychiatrist with the George Washington group.

That is indeed a fear of many employers, said Pamela Greenberg, executive director of the American Managed Behavioral Healthcare Association. "That's one of the reasons we have managed behavioral health care," she said.

Some companies have been better than others at predicting their costs and charging insurers and employers enough to make a profit.

ValueOptions founder and chief executive Ronald I. Dozoretz said his company is "poised for growth and excited about future opportunities." He declined to cite figures, but he said that the company has been profitable since it started in 1983 and that he expects revenue will exceed $1 billion this fiscal year.

Jerome V. Vaccaro, chief executive of PacifiCare Behavioral Health, said, "You very definitely have good and bad managed care in behavioral health." He said his company is profitable in the face of an 18 percent increase in health-care costs over the past year. "We were either very smart or very lucky," he said. "We predicted a lot of these trends [of increased costs]. So we have been able to price for that and decrease our other internal costs."

Other smaller companies haven't been as fortunate. This summer, Integra Inc. of King of Prussia, Pa., filed for Chapter 11 bankruptcy protection. It then announced plans to sell assets to a larger competitor, APS Healthcare Inc. of Bethesda.

Early this month, APS scrapped plans to become a public company, citing "current market conditions." The company's executives declined comment. But the company said in a Securities and Exchange Commission filing early last year that most of its business came from "at risk" contracts with employers and insurers. That meant that for a fixed fee per member per month, it assumed financial responsibility for all costs of treatment and administrative and management services, regardless of the amount . APS said it had not made a profit since it made managed behavioral care its core business in 1997.

The rebellion by George Washington's mental health practice offers insights into how the industry has become, in some respects, a survivalist's game, pitting therapists who complain about low fees and cumbersome pre-treatment authorization requirements against those who pay the bills and are charged with keeping costs down.

As each year passed, Lieberman said, he grew increasingly frustrated with the fees being paid by managed-care companies.

Psychiatrists typically bill insurers more than $100 for a consultation. George Washington University Medical Faculty Associates was being paid as little as $50. Last year, the mental health group began telling patients that while it would continue to participate in the public Medicare and Medicaid programs it would no longer accept private insurance.

The practice -- 12 psychiatrists, 21 residents, four psychologists and four licensed clinical social workers -- began withdrawing from managed-care networks in July 2001. It wasn't an easy decision, Lieberman said.

When reimbursement rates began dropping in the mid-1990s, "we began looking at alternatives," he said. The most obvious was cutting the time they spent with patients. So the group experimented with cutting "psychiatric management" sessions, in which patients' medications and general levels of functioning are assessed, from 30 minutes to 15 minutes.

"We were going to be paid the same amount of money . . . and double the amount of money we would be bringing in," Lieberman said. ". . . But we found we weren't able to give the kind of care that we wanted to. . . . We found that we had to rush patients."

While the practice lost 20 percent of its patients, it gained others and business without managed care has been "terrific," he said. There's less paperwork, more time to spend with individual patients and "substantially" higher fees.

He added: "A lot of the patients that come to us are sort of 'managed-care refugees.' That is, they have been to these managed-care offices where they feel like they've been [told]: Ah, here's your damn prescription. Get the hell out of my office!"

Individual therapists also have been leaving networks.

"The employers want to save money," said Laurence Miller, a psychologist in College Park, who last year pulled out of the CareFirst Blue Cross Blue Shield's HMO network, which is managed by Magellan. "The managed-care companies want to save both themselves and the employers money. And the best way to do that is to restrict the amount you're paying your provider."

Magellan is trying to keep its providers happy. It has been holding drawings this year to give away new Dell computers to "lucky" therapists, according to a note in the company's provider newsletter. "Winners will be selected at random," the note said, "but you must be a Magellan network provider to win. . . . Good luck!"

Psychiatrist Daniel Lieberman said he grew increasingly frustrated with the fees being paid by managed-care companies.