This article investigates the choice of provider plan (fee for service and health maintenance organizations) and preference for a personal physician by Medicare beneficiaries with the aid of a joint logit (JL) and a nested logit (NL) model The NL model, where the lower level is the choice pertaining to preference for a personal physician and the higher level is the choice of provider plan, better explains consumer behavior. Family income levels and access to adequate transportation capabilities are shown to be important criteria used by the elderly in choosing a provider plan.In recent years, quantal choice models have been used more fre-I quently to study consumer behavior in diverse fields including finance (Carroll, Szumpano, and Elder 1988), labor markets (Bishop and Montgomery 1986; Cremer and Gathon 1987), and preferences relating to housing (Borch-Supan and Pitkin 1988). In the area of health care research, Garfinkel et al. (1986) investigated factors contributing to health maintenance organization (HMO) enrollment with the aid of logistic regression models, and Long, Settle, and Wrightson (1988) studied HMO disenrollment patterns using multivariate probit analysis. However, few articles in health care research have investigated modeling structures that ilivolve more complex decision making by the consumer. In today's health care market, the availability of alternatives to health care consumers has been altered by the advent of managed care plans, stricter utilization reviews, and many other AUTHOR'S NOTE: r/~aM~or~M/t~toac~tOM'/ed~M~MD~/t~ P/t.D., andCAar/e.s~re~,