An analysis of the first year's operation of an ambulatory patient monitoring system is presented. The program was designed to accomplish the following objectives: 1) to demonstrate individual clinic effectiveness in giving each member of its service population a complete assessment of his health status, and 2) to implement patient surveillance for follow-up and periodic reevaluation. The system was adapted to the pre-existing computer-based ambulatory patient care reporting mechanism which is in use by Indian Health Service members and contracting facilities. It employs discrete health Status Categories whose definitions are based in specific clinical criteria.This approach permits the interpretation of categorical patient flow statistics as representative of identifiable clinic practices. Quarterly data printouts provide a basis for interpreting the degree of clinic progress toward initial health assessment of the total population served. Such data, when viewed against the backdrop of specific operational objectives allow for continuous program reassessment of community needs, and provide a technique for monitoring the effectiveness of the health care delivery system in meeting these needs.By controlling for individual variations in clinic objectives, comparisons can be made between separate facilities within the network. In addition, the technique provides a method for focusing on areas where objectives may not be realistic and provides a data base on which alternative program goals can be formulated.