OBJECTIVES: To compare differences in the functional outcomes experienced by patients cared for in Hospital at Home (HaH) and traditional acute hospital care. DESIGN: Survey questionnaire of participants in a prospective nonrandomized clinical trial. SETTING: Three Medicare managed care health systems and a Veterans Affairs Medical Center. PARTICIPANTS: Two hundred fourteen community-dwelling elderly patients who required acute hospital admission for community-acquired pneumonia, exacerbations of chronic heart failure or chronic obstructive pulmonary disease, or cellulitis, 84 of whom were treated in HaH and 130 in an acute care hospital. INTERVENTION: Treatment in a HaH care model that substitutes for care provided in the traditional acute care hospital. MEASUREMENTS: Change in activity of daily living (ADL) and instrumental activity of daily living (IADL) scores from 1 month before admission to 2 weeks post admission to HaH or acute hospital and the proportion of groups that experienced improvement, no change, or decline in ADL and IADL scores. RESULTS: Patients treated in HaH experienced modest improvements in performance scores, whereas those treated in the acute care hospital declined (ADL, 0.39 vs -0.60, P=.10, range -12.0 to 7.0; IADL 0.74 vs -0.70, P=.007, range -5.0 to 10.0); a greater proportion of HaH patients improved in function and smaller proportions declined or had no change in ADLs (44% vs 25%, P=.10) or IADLs (46% vs 17%, P=.04). CONCLUSION: HaH care is associated with modestly better improvements in IADL status and trends toward more improvement in ADL status than traditional acute hospital care.