What comes immediately to mind, in evaluating physician competence, is a jumble of methods that jockey for position and clash in what, at times, seems to be a battlefield of contending parties. We must return to first principles, if we are to understand this surface confusion and choose wisely from the many methods offered to us. And perhaps the most fundamental question to ask is: "Competence to do what? What are the objectives, and what are the preferred means for attaining these objectives?". I shall attempt an answer under three headings: the area of responsibility, the level of responsibility, and the means. The area of responsibility is, itself, a complex and expanding field. At its core is the management of physical illness through the application of the science and technology of medicine. It follows that the degree of mastery over this science and technology is at the heart of competence; but by no means does this define its totality. The successful management of physical illness often requires an extension in the content of medicine to include the management of cognitive, other psychological, and social factors. This is because these factors may have a role in the causation or persistence of physical illness; and, even when this is not the case, their appropriate manipulation is often necessary for success in applying the science and technology of medicine. In addition, physical illness creates in the patient a variety of psychological needs that he expects to be satisfied in the patient-physician interaction. In these ways and for these reasons, the question "Competence for what? "acquires new meaning and makes new demands on the physician and on the organization within which he works. A shift in focus from the management of physical illness to the management of physical health adds another conceptual dimension and brings about further extensions in the criteria of technical, psychological and social management that constitute competence. And this is not all. Parallel to the progression from physical illness to physical health there are the analogous areas of responsibility for mental illness and mental health, and for social illness and social health. At its fullest extension, the area of responsibility: embraces "physical, mental and social well-being", as envisaged by the definition of the World Health Organization. This may represent an extension to absurdity, and I do not necessarily advocate it. All I am saying is that we must define the content and boundaries of our legitimate responsibilities before we are able to determine competence to discharge those responsibilities. The levels of responsibility offer a similar prospect of progressive inclusivity and complexity, with the added threat of moral ambiguity and conflict. The primary, responsibility of the physician is for the individual patient. At this level, the objective is to find and implement the optimal solution to the balance of benefits and risks in medical management. Selecting the appropriate context within which this is to be done and arriving at the optimal solution is the essence of clinical judgement; and assessing clinical judgement is the essence of evaluating physician competence. Anything less is peripheral, incomplete, and possibly dangerous. However, the physician is responsible not only for an individual but also for a case load. This must place a limit on the amount of time, attention, and possibly other resources that can be committed to each patient. Thus, clinical judgement requires identification of relative priorities among patients. In this way, the physician becomes a major instrument for resource allocation; and the optimal resource allocation solution becomes a part of the quality of care. If so, a case-by-case assessment of competence may fail to identify an important element in aggregate quality. In private practice, each physician is responsible for resolving whatever contradiction might arise between optimal strategies for individuals and for the case load, by limiting the size of the latter. …