Given the move to managed care and capitated budgets, psychologists mu
st now prove that the treatments being offered are clinically effectiv
e in allaying symptoms and are cost-effective. Cost-effectiveness anal
ysis (CEA) is often seen as a daunting task requiring one to pour over
spread sheets with little empathy for the patient. This article attem
pts to break this daunting task down into nine reasonable steps. By us
ing CEA, psychologists will have the data to compete for dollars in th
is time of limited funds. An overriding attempt was made not to use ex
cessive technical jargon or formulas in this review. The goal of this
article is to offer the average practitioner, clinic director, or depa
rtment chair an easily understood method that can be adapted and appli
ed to his or her unique environment. If psychologists, individually an
d as a profession, choose to ignore the power of CEA, other profession
als may step in and take this power and control our future.