Catheter-associated urinary tract infection, a common and potentially preventable complication of hospitalization, is one of the hospital-acquired complications chosen by the Centers for Medicare and Medicaid Services (CMS) for which hospitals no longer receive additional payment. To help understand the potential consequences of the recent CMS rule changes we examine the preventability of catheter-associated infection, review the CMS rules changes regarding catheter-associated urinary tract infection, offer our assessment of the possible consequences of these changes, and provide guidance for hospital-based administrators and clinicians. Though controversial, we conclude that the CMS rule changes related to catheter-associated urinary tract infection may do more good than harm since hospitals are likely to re-double their efforts in preventing catheter-associated urinary tract infection, which may minimize unnecessary placement and facilitate prompt removal of indwelling catheters. While we applaud CMS for forcing hospitals to increase efforts to prevent complications stemming from hospital-acquired infection, the opportunity costs and potential for unintended consequences cannot be overlooked. Consequently, how hospitals and physicians respond to the CMS rule changes must be monitored closely.