Describes a study conducted to gather information on the rural effects of the PPS, including whether the PPS contributed to changes in: (1) the demographic and clinical characteristics of home care users; (2) the likelihood of using each of six home care disciplines (aide, skilled nursing, physical therapy, occupational therapy, speech therapy and medical social work); and (3) the intensity of services. A total of 99,367 home health episodes were represented in the two years of Medicare data examined. In both study years, urban residents accounted for three-quarters of episodes, while residents of large rural counties and those of remote rural counties accounted for approximately 21 percent and 3 percent of episodes, respectively. Findings suggest that the PPS has had a mixed effect on access to home care in rural counties. Study results indicated an association between implementation of the PPS and admitting home health diagnoses, utilization and intensity of home care episodes and, for the subset of home health users admitted from an acute hospital, readmission rates.