BACKGROUND: Achieving patient-physician continuity is difficult in the inpatient setting, where care must be provided continuously. Little is known about the impact of hospital physician discontinuity on outcomes. OBJECTIVE: To determine the association between hospital physician continuity and percentage change in median cost of hospitalization, 30-day readmission, and patient satisfaction with physician communication. DESIGN: Retrospective observational study using various multivariable models to adjust for patient characteristics. PARTICIPANTS: Patients admitted to a non-teaching hospitalist service in a large, academic, urban hospital between 6 July 2008 and 31 December 2011. MAIN MEASURES: We used two measures of continuity: the Number of Physicians Index (NPI), and the Usual Provider of Continuity (UPC) index. The NPI is the total number of unique physicians caring for a patient, while the UPC is calculated as the largest number of patient encounters with a single physician, divided by the total number of encounters. Outcome measures were percentage change in median cost of hospitalization, 30-day readmissions, and top box responses to satisfaction with physician communication. KEY RESULTS: Our analyses included data from 18,375 hospitalizations. Lower continuity was associated with modest increases in costs (range 0.9-12.6 % of median), with three of the four models used achieving statistical significance. Lower continuity was associated with lower odds of readmission (OR=0.95-0.98 across models), although only one of the models achieved statistical significance. Satisfaction with physician communication was lower, with less continuity across all models, but results were not statistically significant. CONCLUSIONS: Hospital physician discontinuity appears to be associated with modestly increased hospital costs. Hospital physicians may revise plans as they take over patient care responsibility from their colleagues.KEY WORDS: continuity of care; health care costs; health services research; hospital medicine.