The national program under which rural hospitals are currently providing swing-bed care is the result of a HCFA-sponsored demonstration and evaluation program involving more than 100 rural hospitals in four states. We summarize herein the larger of two evaluation studies of the program. The experimental hospitals averaged approximately two fully occupied swing beds, experienced a 5% increase in total occupancy owing to swing-bed care, and may have reduced acute care length of stay slightly. A strong negative correlation between acute care occupancy and use of swing beds was observed, but no evidence was found to support the hypothesis that swing-bed care decreases nursing home occupancy in rural communities.