Managed care techniques are increasingly being applied in the workers' compensation setting. Many workers, labor representatives and public health advocates fear that the introduction of managed care into workers' compensation may reflect a broader employer-driven campaign to erode benefits, tighten eligibility criteria, and weaken employees' control over health care and compensation issues. The potential threats to workers can be mitigated by involving them in the design of the workers' compensation health plan and selection of provider organization, assuring access to appropriate specialists and diagnostic testing, minimizing delays, increasing accountability through contract provisions and government oversight, and enhancing communications through the use of ombudsmen and alternative dispute resolution approaches. Additional outcomes studies assessing the long-term impact of managed care in workers' compensation are needed.