Using data on 295 patients entering Medicare home health care at discharge from Medicare hospital stays, we explain receipt of Medicare home health nursing, PT and OT visits, and length of stay. Care reflected need, but other factors also affected service allocation. Medicare program requirements, as well as variation in provider structure and case load, appear to introduce inequities. Critical in light of recurrent proposals to change Medicare coverage and benefits, findings underline the need to reconsider Medicare home health policies that lead to denial of needed services, inequitable allocation of benefits, and premature termination of care.