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We estimated the impact of alternative discharge strategies, following joint replacement (JR) surgery, on acute care readmission rates and the total cost of a continuum of care. Following surgery, patients were discharged to one of four destinations. Propensity scores were used to adjust costs and outcomes for potential bias in the assignment of discharge destinations. We demonstrated that the use of rehabilitation hospitals may lower readmission rates, but at a prohibitive incremental cost of each saved readmission, that patients discharged with home care had longer acute care stays than other patients, that the provision of home care services increased health system costs, and that acute care readmission rates were greatest among patients discharged with home care. Our study should be seen as one important stepping stone towards a full economic evaluation of the continuum of care for patients. [ABSTRACT FROM AUTHOR]