Ten Professional Standards Review Organization (PSRO) demonstration projects in long-term care (LTC) review developed and tested LTC review methods. A multidisciplinary RAND team assessed the demonstration effort. Methods included analyses of written materials; site visits; and interviews with PSRO personnel and board members, state officials, nursing home representatives, and other interested parties. A substudy of 227 telephone interviews provided information from the (largely positive) perspective of the LTC facility. The projects used the demonstration period to develop review staff, physician committees, criteria for the need for care at the skilled and intermediate level, criteria for quality of care assessment, and relationships with state officials and local nursing homes. The PSROs were able to demonstrate similar deficiencies in care quality at each site. Assessment methods leave much to be desired but the demonstration work has advanced the field. The promising beginning makes it imperative to preserve an incentive for PSROs to enter the LTC review field.