A retrospective chart review was designed to evaluate how pediatric and adolescent patients fare within a strictly managed, capitated outpatient psychiatric setting. The charts of 96 consecutively evaluated patients, treated by one psychiatrist, were reviewed. Standardized assessment tools were used to reach a DSM-IV diagnosis. The initial level of severity was defined by a Global Assessment of Functioning scale at the time of the evaluation, and improvement after pharmacologic treatment was measured by the Global Index of Improvement. Patients in this sample suffered from similar psychiatric disorders and similar levels of initial impairment when compared with those reported in other outpatient samples. Of the original 96 youths, nine patients were initially referred to their primary care physician for medication treatment, and 26 had been told that pharmacotherapy was not indicated. In the psychiatric clinic, psychopharmacotherapy was recommended for 61 of the 96 patients (64%), and 46 patients (48%) followed through with this plan. Of the 46 patients treated with medications, 72% improved within approximately 4 months of treatment, whereas 28% did not. Five of the 23 (22%) adolescent patients with major depression were hospitalized within 2 months of the initial evaluation. Most of these pediatric and adolescent psychiatric patients appeared to be treated satisfactorily, despite the strong limitations of a capitated outpatient service. However, significant limitations in time and resources necessitated a variety of clinical adaptations to maintain adequate delivery of mental health services.