This Note outlines the research plan for RAND's Preferred Provider Organization (PPO) Study, which will analyze the experience of six large employers that have contracted with one or more PPOs to provide additional options for employees participating in the employers' health benefits plans. The research plan is designed to answer three broad questions: (1) What are the characteristics of employees who elect to enroll in the PPO plan, or use providers participating in the PPO? (2) What is the effect of PPOs on health services utilization and costs? (3) Do providers participating in PPOs practice differently from those declining to participate, or those not included in the PPO? The study will use econometric analysis, simulation, actuarial analysis, and case studies, and it will use four kinds of data: personnel records, surveys of employees, health insurance claims data, and a survey of physicians.