High psychiatric readmission rates continue while evidence suggests that care is not perceived by patients as “patient centered.” Research has focused on aftercare strategies with little attention to the inpatient treatment itself as an intervention to reduce readmission rates. Quality improvement strategies based on patient-centered care may offer an alternative. We evaluated outcomes and readmission rates using a benchmarking methodology with a naturalistic data set from an inpatient psychiatric facility (N = 2,247) that used a quality-improvement strategy called systematic patient feedback. Benchmarks were constructed using randomized clinical trials (RCTs) from inpatient treatment for depression, RCTs from patient feedback in outpatient settings, and national data on psychiatric hospital readmission rates. A systematic patient feedback system, the Partners for Change Outcome Management System (PCOMS), was used. Overall pre-post effect sizes were d = 1.33 and d = 1.38 for patients diagnosed with a mood disorder. These effect sizes were statistically equivalent to RCT benchmarks for feedback and depression. Readmission rates were 6.1% (30 days), 9.5% (60 days), and 16.4% (180 days), all lower than national benchmarks. We also found that patients who achieved clinically significant treatment outcomes were less likely to be readmitted. We tentatively suggest that a focus on real-time patient outcomes as well as care that is “patient centered” may provide a path toward lower readmission rates in addition to other evidence-based strategies after discharge.