This study considers differences in access to health care and insurance characteristics between residents of urban and rural areas. Data were collected from a telephone survey of 10,310 randomly selected households in Minnesota. Sub-samples of 400 group-insured, individually insured, intermittently insured, and uninsured people, were asked about access to health care. Those with group or individual insurance were also asked about the costs and characteristics of their insurance policies. Rural areas had a higher proportion of uninsured and individually insured respondents than urban areas. Among those who purchased insurance through an employer, rural residents had fewer covered benefits than urban residents (5.1 vs 5.7, P < 0.01) and were more likely to have a deductible (80% versus 40%, P < 0.01). In spite of this, rural uninsured residents were more likely to have a regular source of care than urban residents (69% versus 51%, P < 0.01), and were less likely to have delayed care when they thought it was necessary (21% versus 32%, P < 0.01). These differences were confirmed by multivariate analysis. Rural residents with group insurance have higher out-of-pocket costs and fewer benefits. Uninsured rural residents may have better access to health care than their urban counterparts. Attempts to expand access to health care need to consider how the current structure of employment-based insurance creates inequities for individuals in rural areas as well as the burdens this structure may place on rural providers.