The aim of this paper is to present the effects of the reform of primary care by privatization and direct contracting between general practitioners/family physicians and the Croatian Institute for Health Insurance, as well as to propose possible improvements. Using the data of the Croatian Institute of Public Health, we analyzed the coverage of population and accessibility of service, management of chronic illnesses, home visits, and preventive check-ups in the family medicine service. In 2001, 2,408 (30.8% vocationally trained) doctors worked in the family medicine service, taking care of 3.759,248 (84.7%) registered inhabitants of Croatia. There was an average of 6 office encounters, 0.1 home visits, 0.05 preventive check-ups and 1.4 referrals per patient per year. Within the Project of Health System Reform a working group of primary care experts proposed the following improvements: 1) the family medicine service should be organized in accordance with the fundamental principles of accessibility, continuity, and integrated care; and 2) a multilayered financing model should be used, containing a capitation fee payment, fee for service payment, and specific program payment. Taking into account the European Union recommendation, a project aimed at ensuring the specialization of family medicine for all doctors working in the family medicine service was started in 2003. This study indicates that there is a gap between proclaimed health system improvements and effects of the reform of primary care. In order to achieve evidence-based health policy, concerted action of all participants in the decision-making process is needed.