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Propensity score methods been used to minimize the selection bias in observational studies to identify causal relationships. Propensity score analysis aims to use the estimate to create balanced groups, akin to a randomized experiment. This study used Monte Carlo methods to examine the appropriateness of using propensity score methods to achieve balance between groups on observed covariates and reproduce treatment effect estimates in multilevel studies. The results of this study suggest the degree to which propensity score analyses are able to create balanced groups and reproduce treatment effect estimates with clustered data is largely dependent upon the propensity score estimation model and conditioning method selected.