In an era of competition in health care delivery, those who pay for care are interested in supporting primarily those activities that add value to the clinical enterprise. The authors report on their 1998 project to develop a conceptual model for assessing the value added to clinical care by educational activities. Through interviews, nine key stakeholders in patient care identified five ways in which education might add value to clinical care: education can foster higher-quality care, improve work satisfaction of clinicians, have trainees provide direct clinical services, improve recruitment and retention of clinicians, and contribute to the future of health care. With this as a base, an expert panel of 13 clinical educators and investigators defined six perspectives from which the value of education in clinical care might be studied: the perspectives of health-care-oriented organizations, clinician-teachers, patients, education organizations, learners, and the community. The panel adapted an existing model to create the "Education Compass" to portray education's effects on clinical care, and developed a new set of definitions and research questions for each of the four major aspects of the model (clinical, functional, satisfaction, and cost). Working groups next drafted proposals to address empirically those questions, which were critiqued at a national conference on the topic of education's value in clinical care. The next step is to use the methods developed in this project to empirically assess the value added by educational activities to clinical care.