New financial penalties for institutions with high readmission rates have intensified efforts to reduce rehospitalization. Several interventions that involve multiple components (e.g., patient needs assessment, medication reconciliation, patient education, arranging timely outpatient appointments, and providing telephone follow-up) have successfully reduced readmission rates for patients discharged to home. The effect of interventions on readmission rates is related to the number of components implemented; single-component interventions are unlikely to reduce readmissions significantly. For patients discharged to postacute care facilities, multicomponent interventions have reduced readmissions through enhanced communication, medication safety, advanced care planning, and enhanced training to manage medical conditions that commonly precipitate readmission. To help hospitals direct resources and services to patients with greater likelihood of readmission, risk-stratification methods are available. Future work should better define the roles of home-based services, information technology, mental health care, caregiver support, community partnerships, and new transitional care personnel.