OBJECTIVE: To ascertain the impact of advanced access and productivity-based pay on physician productivity and compensation, patient satisfaction, and medical group cost of delivering care. STUDY DESIGN: Longitudinal case study. METHODS: Study subjects were 105 primary care physicians (PCPs) continuously employed at a Minnesota medical group that implemented major changes in access to primary care appointments and to PCP compensation arrangements in 2000. We tracked physician productivity, physician compensation, patient satisfaction, and cost to the medical group per relative value unit (RVU) of patient care from 1998 through 2002. RESULTS: In 1998, 105 PCPs (99.6 full-time equivalents [FTEs]) generated 275,000 work RVUs (WRVUs), and PCP pay averaged 123,500 dollars per FTE. In 2002, the same 105 PCPs (now 98.1 FTEs) generated 374,000 WRVUs and 148,000 dollars pay per FTE. From 1998 through 2002, WRVUs per FTE rose 38%, PCP compensation increased 20%, cost of PCP compensation per WRVU produced fell by 13%, overall direct cost of running the clinics per total RVU fell by 20%, and patient satisfaction remained constant. Improvement in operating costs was due to increased physician productivity, lower physician compensation per RVU, and a decline in support staff per 10,000 RVUs from 6.80 to 4.50. CONCLUSIONS: It is possible to substantially and simultaneously improve costs of care, physician compensation, and patient access without harming patient satisfaction. Advanced access and productivity-based pay may be effective ways to address the challenges of timeliness, efficiency, and patient centeredness identified by the Institute of Medicine.