This study takes a statistical-modeling point of view to the assessment of health care services and procedures. The emphasis is on small-area prediction of incidence rates from spatially contiguous regions, although suitable modifications can also give doctor-level predictions. The main idea is to recognize the individuality of each region through a spatial Bayesian model for incidence rates. A noise component, because of location error and measurement error, is filtered out using empirical Bayes methods. The resulting smoothed predictors of incidence rates provide an accurate picture of the health care service or procedure under investigation. © 1993, J.B. Lippincott Company.