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A 1992 General Accounting Office (GAO) study on costs of anesthesia found that anesthetics administered by anesthesia care teams (ACTs) were more costly than those administered by Certified Registered Nurse Anesthetists (CRNAs) or anesthesiologists practicing alone. In 1994, Medicare implemented a single payment system in response to the GAO report and recommendations by the Physician Payment Review Commission. Restructuring of many anesthesia departments has followed. A study was conducted in a 370-bed public teaching hospital to: 1. Examine how one ACT functionally provided services. 2. Identify roles of CRNAs and anesthesiologists within this team practice. 3. Determine if medical direction was perceived as equally beneficial in all cases. 4. Identify practice modifications which could possibly lower costs. All anesthetics (n = 358), excluding obstetrics, were studied over a 4-week period. Sixty-four variables were collected on each case including patient demographics, case characteristics, provider functions, and outcome data. Most patients were healthy and had low complexity operations. Systat statistical software was used for data analysis. There were clear functional variations in the roles of anesthesiologists and nurse anesthetists within the anesthesia care team. Anesthesiologists provided most preoperative and postoperative care, while nurse anesthetists administered the majority of anesthetics. Anesthesiologists and nurse anesthetists in this study agreed in their perceptions that more than 70% of these cases did not need medical direction. Logistical regression of variables was used to construct a predictive equation for cases where providers perceived that medical direction was beneficial.(ABSTRACT TRUNCATED AT 250 WORDS)