Variations in hospitalization rates for selected conditions are being used as indicators of the effectiveness of primary care in small areas. Are these rates actually sensitive to problems in local primary care systems? This study examines the relationship between ambulatory care sensitive condition (ACSC) hospital admission rates and primary care resources and the economic conditions in primary care market areas in North Carolina in 1994. The data show a high degree of correlation between the rates and income but not primary care resources. The distribution of rates did agree with expert assessments of the location of places with poor access to health services. The data confirm that access to effective primary care reflected in lower rates of ACSC admissions is a function of more than the professional resources available in a market area. The solution to reducing disparities in health status may not lie within the health system.