Residential treatment providers have reason to be concerned with managed care's focus on reducing costs. Managed care may pose risks especially to children who have intensive service needs and who require comprehensive, long-term, and often expensive treatment. To meet the needs of these children and their families, as well as to ensure their own financial viability, residential treatment centers need to adapt their programs and practices to respond to the new demands of the managed care environment. One acute residential treatment program is examined in detail, a short-term crisis intervention program that blends the core skills of residential treatment with the demands of managed care organizations to provide effective services for children and families. An evaluation of this program suggests child welfare professionals do not have to compromise their values and beliefs in order to survive in an era of managed care. 5 references and 6 tables