The Pediatric Health Policy Group of the University of Colorado Health Sciences Center (Denver) surveyed 650 family physicians and 296 pediatricians in 1988, with 50% of family physicians and 48% of pediatricians responding. Half of the pediatricians in private practice and 35% of family physicians in private practice accepted all children who were Medicaid beneficiaries into their practice; 42% of pediatricians and 50% of family physicians accepted all non-Medicaid patients but only some new Medicaid patients; and 8% of pediatricians and 15% of family physicians accepted new non-Medicaid patients but no Medicaid patients. Practice location was associated with the level of Medicaid participation for these primary care physicians: Significantly more rural pediatricians and family physicians than those with urban practices accepted Medicaid patients. The average reimbursement level for these physicians was shown to be an important determinant of whether physicians would accept Medicaid patients. Nonparticipatory physicians were more concerned about excessive paperwork compared with physicians with limited participation. Among physicians with limited participation, family physicians and pediatricians both cited problems of excessive paperwork, reimbursement delays, and retroactive denials of payment as important deterrents to accepting Medicaid patients.