The rapid growth of prepaid health care plans imposes clinical, financial, and educational changes on residency programs. In the study reported here, the authors examined some perceived and actual effects of such plans on a family medicine center associated with a family medicine residency training program. In the study, 37 residents and 19 faculty members completed a 5-point, 16-item survey covering the effect of the prepaid plans used at the center on the program's practice profile, cost-containment efforts, and education activities over a three-year period. Overall, the respondents agreed with the need for cost containment that accompanied participation in the prepaid plan and agreed that prepaid plans increased the number of patient visits and visits by family members. The residents and faculty members agreed that prepaid patients were more demanding and were seen more often for minor or inappropriate problems. Regarding the educational impact of the prepaid plans, the respondents agreed that they improved their clinical decision-making, and no significant concern regarding limitation of laboratory or consultations was noted. Some of the respondents' perceptions were corroborated by findings in the clinic data base that showed increased numbers of patient visits, more visits by members of the same family, and no significant change in outpatient consultation rates. © 1988 Association of American Medical Colleges.