The aim of this study was to determine whether home telehealth, when integrated with the health facility's electronic medical record system, reduces healthcare costs and improves quality-of-life outcomes relative to usual home healthcare services for elderly high resource users with complex co-morbidities. Study patients were identified through the medical center's database. Intervention patients received home telehealth units that used standard phone lines to communicate with the hospital. FDA-approved peripheral devices monitored vital signs and valid questionnaires were used to evaluate quality-of-life outcomes. Out-of-range data triggered electronic alerts to nurse case managers. (No live video or audio was incorporated in either direction.) Templated progress notes facilitated seamless data entry into the patient's electronic medical record. Participants (n = 104) with complex heart failure, chronic lung disease, and/or diabetes mellitus were randomly assigned to an intervention or control group for 6-12 months. Parametric and nonparametric analyses were performed to compare outcomes for (1) subjective and objective quality-of-life measures, (2) health resource use, and (3) costs. In contrast to the control group, scores for home telehealth subjects showed a statistically significant decrease at 6 months for bed-days-of-care (p < 0.0001), urgent clinic/emergency room visits (p = 0.023), and A1C levels (p < 0.0001); at 12 months for cognitive status (p < 0.028); and at 3 months for patient satisfaction (p < 0.001). Functional levels and patient-rated health status did not show a significant difference for either group. Integrating home telehealth with the healthcare institution's electronic database significantly reduces resource use and improves cognitive status, treatment compliance, and stability of chronic disease for homebound elderly with common complex co-morbidities.