From Ken Rosenthal:

If no agreement is reached and Mussina becomes a free agent, he will not simply sell himself to the highest bidder. He will want to play for a contender, remain in the American League and stay relatively close to his home in Montoursville, Pa.

His first two choices after the Yankees would be the Red Sox and Indians; his NL possibilities would be the Mets and Phillies. A return to the Orioles — a non-contender for the foreseeable future &3151; is virtually out of the question.

Via Yahoo! Sports