Insurance carriers affected decisions regarding admissions and length of stay in our hospital in 1987. Charts were reviewed retrospectively to determine whether this affected morbidity and mortality rates following cleft lip and palate operations in infants. Two periods were studied: May of 1983 through April of 1987 (group I) and April of 1987 through May of 1991 (group II). A total of 248 infants with cleft lip and/or palate underwent 398 operations: lip adhesion (74), definitive lip repair (130), and palatoplasty (194). Half were performed in each period. Admission status, length of stay, length of operation, and short-term morbidity were documented. Morbidity included spontaneous and traumatic lip dehiscence, palatal dehiscence, and palatal fistula. Intergroup analysis was performed by the chi-squared method; p < or = 0.05 was statistically significant. In group I, 93 percent of patients were admitted before surgery. In group II, 5 percent were admitted before surgery and 79 percent the day of surgery. Hospital stay decreased nearly 2 days for each operation. There was no statistically significant difference between groups in distribution of operations, length of operations, or morbidity: lip surgery complications (p = 0.263), palatoplasty complications (p = 0.624). Reductions of hospital admissions and length of stay do not affect outcome of cleft lip and palate surgery in infants. The reduction in hospital days is equivalent to a savings of $138,000 (1991 dollars).