Findings from this study suggest that changes in home health reimbursement were associated with dramatic reductions in the supply of home care agencies; however those reductions appear to have occurred primarily during the time in which the Interim Payment System was in place. Although proportionately fewer rural agencies closed between 1998 and 2000, the closure of a rural agency may have a greater impact on access since many communities are experiencing critical shortages of providers. In the post-PPS period, agency supply became more stable, but closure rates were higher among rural agencies.