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Medicare adopted transitional care management (TCM) payment codes in 2013 to encourage clinicians to furnish TCM services after beneficiaries were discharged to the community from medical facilities. To bill for the 30-day service, a care team member must communicate with the beneficiary or the caregiver within 2 business days after the discharge and the clinician must provide an office visit within 14 days.To investigate whether the receipt of TCM services was associated with the subsequent health care costs and mortality of the beneficiaries in the month after the service was provided.Retrospective cohort analysis of all Medicare fee-for-service claims for the period of January 1, 2013, through December 31, 2015, for 18 756 707 Medicare fee-for-service beneficiaries with discharges eligible for subsequent TCM services. Discharges from a hospital, an inpatient psychiatric facility, a long-term care hospital, a skilled nursing facility, an inpatient rehabilitation facility, or an outpatient facility for an observational stay were included. Data analysis was performed from July 2016 to March 2018.Furnishing of TCM services for the 30 days following an eligible discharge for Medicare beneficiaries as reflected in Medicare fee-for-service claims.Total Medicare (Parts A, B, and D) health care costs and mortality in the 31 to 60 days after discharge, which is 30 days beyond the potential period for which the beneficiary could receive TCM services. Health care costs and mortality were adjusted for beneficiary age, sex, risk score, dual eligibility for Medicare and Medicaid, type of eligible discharge, year of discharge, and whether the eligible discharge to the community included home health care.Of 18 756 707 eligible Medicare beneficiaries during the study period, 43.9% were male and had a mean (SD) age of 72.5 (13.8) years. Transitional care management services were billed following eligible discharges in 3.1% of cases in 2013, 5.5% in 2014, and 7.0% in 2015. The adjusted total Medicare costs ($3358; 95% CI, $3324-$3392 vs $3033; 95% CI, $3001-$3065; P < .001) and mortality (1.6%; 95% CI, 1.6%-1.6% vs 1.0%; 95% CI, 1.0%-1.1%; P < .001) were higher among those beneficiaries who did not receive TCM services compared with those who did receive TCM services in the 31 to 60 days following an eligible discharge.Despite the apparent benefits of TCM services for Medicare beneficiaries, the use of this service remains low. An assessment should be made of interventions that can increase the appropriate use of this service.