NEW YORK _ Managed-care companies have several names for what's ailing people who spend years in psychotherapy that the companies consider unproductive: they call it the New Yorker syndrome or the Woody Allen syndrome. And they intend to eradicate it.

But who determines whether psychiatric treatment is productive or merely high-cost self-improvement? This question has led to pitched battles between the companies and psychotherapists, particularly in the New York region, where more than 20 percent of the nation's therapists work.

The battle is seen as a testing ground for the efforts of managed-care companies to scrutinize more closely medical spending in New York, where managed care has been slow to take hold.

Many therapists say managed-care companies, intent on cutting costs, are undermining the quality of care by calling the shots on treatment without ever seeing a patient. These companies, they say, favor doctors who charge the lowest fees, driving some practitioners from the profession.

"This industry is destroying the field," said Dr. Karen Shore, a psychologist and co-chairwoman of the Coalition of Mental Health Professionals and Consumers, a Long Island-based national group that opposes managed care for mental health. "Nobody wants their kid to be a psychologist anymore."

Managed-care companies and their advocates, who include some psychiatrists, counter that therapists are chiefly unhappy about the loss of income. Insurance plans have never been very generous with mental health care, but the managed-care companies are even more parsimonious.

In the New York area, typical therapy fees range from $150 to $300 an hour for a psychiatrist and from $40 to $150 an hour for a social worker, but managed-care companies generally pay only 55 to 60 percent of that. One doctor said he was getting $80 a visit from managed-care companies but usually charged twice that; another was asked to settle for $40.

Supporters of managed care say many practitioners would rather keep people in talk therapy for years than try drug therapy that has increasingly proven effective. For years, these doctors had authority to continue treatment that shows no signs of working, the companies say.

"There's a lot of resistance against managed care among psychiatrists because they don't want to be part of a system where they have to conform to what the company's rules are," said Dr. Terry Golash, medical director for Empire Blue Cross/Blue Shield, who has both supervised managed-care reviewers and been subject to their scrutiny in his private practice. "A lot of doctors don't like to call and ask for permission."

Dr. Ian Shaffer, executive vice president and chief medical officer of Value Behavioral Health, the country's largest managed-care company, argued that patients can suffer when their doctors' decisions go unchallenged.

But therapists say patients suffer when their professional judgements are challenged by sometimes unqualified employees of managed-care companies who press them for confidential information.

Psychiatrists also complain that they are increasingly limited to dispensing pills as therapy is conducted more and more by licensed social workers or psychiatric nurses who charge lower fees. Psychologists say they, too, are being shunned, and many are leaving private practice for diagnostic and consulting work in schools and businesses.

One Manhattan psychoanalyst said those in his line of work are "an endangered species."

Most managed mental health care companies report that they deny a very small number of requests for treatment. Value Behavioral Health, for example, has an outright denial rate of less than 1 percent.

But reviewers and providers commonly negotiate agreements that provide less treatment than the therapists originally requested, Golash said. …