Background. Despite the existence of Medicaid and other programs desig
ned to eliminate cost as a barrier to immunization in physicians' offi
ces, referrals to local health departments for immunizations are commo
n. Many children leave their physicians' offices without receiving nee
ded immunizations. Purpose. To determine: 1) the frequency and determi
nants of immunization referrals to health departments in North Carolin
a, and 2) the factors associated with private physicians' decisions to
immunize Medicaid children in their offices and participate in the st
ate-funded vaccine replacement program. Methods. The 2537 pediatrician
s and family physicians licensed in North Carolina were surveyed by ma
il using a 23-item, self-administered questionnaire. Results. Seventy-
two percent of physicians responded; 93% referred at least some childr
en to local health departments for immunizations. Concern regarding pa
rents' ability to pay for immunizations was the most important reason
for referral for 93% of respondents. Forty percent referred all or som
e of their Medicaid patients; excessive paperwork, inadequate reimburs
ement, and parental preferences were the most common reasons. Only 33%
of physicians had participated in the state's vaccine replacement pro
gram. Family physicians, and physicians in solo or two-physician pract
ices in rural counties, and in practices caring for a small number of
children on Medicaid were most likely to refer children covered by Med
icaid and not participate in the state's existing vaccine replacement
program. Conclusions. Medicaid and North Carolina's vaccine replacemen
t program are not preventing large numbers of immunization referrals t
o health departments. Future programs designed to increase the proport
ion of children immunized in physicians' offices will not succeed if m
ore effective incentives for physician participation are not developed
.