Critical issues in reforming rural mental health service delivery systems under health care reform are outlined. It is argued that the exclusive focus on health care financing reform fails to include obstacles to effective mental health service delivery in rural area, which should focus on issues of availability, accessibility, and acceptability, as well as financing and accountability. Characteristics of rural areas are delineated and three assumptions about the structure of rural communities which are shaping the dialogue on rural health and mental health service delivery are examined. These assumptions include the notion that rural communities are more closely knit than urban ones, that rural services can be effectively delivered through urban hubs, and that rural dwellers represent a low risk population which can be effectively served through existing facilities and by extending existing services.