This study examines how 296 new university employees selected among alternative health care options. Those selecting a traditional Blue Cross and Blue Shield (BC&BS) plan attributed greater importance to freedom of choice of physician, while those selecting an HMO were more likely to give priority to cost considerations in seeing a doctor and to having services at a single location. Better educated respondents and those with more recent experience with the medical care system were more accurate in objectively appraising alternative choices. Respondents, whether choosing a BC&BS plan or an HMO, tended to deny the gatekeeper roles of physicians in HMOs, although the BC&BS plan enrollees were somewhat better informed.