Case management is believed to promote continuity of care and decrease hospitalization rates, although few controlled trials have tested this approach. To assess the effectiveness of a standardized telephonic case-management intervention in decreasing resource use in patients with chronic heart failure. A randomized controlled clinical trial was used to assess the effect of telephonic case management on resource use. Patients were identified at hospitalization and assigned to receive 6 months of intervention (n = 130) or usual care (n = 228) based on the group to which their physician was randomized. Hospitalization rates, readmission rates, hospital days, days to first rehospitalization, multiple readmissions, emergency department visits, inpatient costs, outpatient resource use, and patient satisfaction were measured at 3 and 6 months. The heart failure hospitalization rate was 45.7% lower in the intervention group at 3 months (P =.03) and 47.8% lower at 6 months (P =.01). Heart failure hospital days (P =.03) and multiple readmissions (P =.03) were significantly lower in the intervention group at 6 months. Inpatient heart failure costs were 45.5% lower at 6 months (P =.04). A cost saving was realized even after intervention costs were deducted. There was no evidence of cost shifting to the outpatient setting. Patient satisfaction with care was higher in the intervention group. The reduction in hospitalizations, costs, and other resource use achieved using standardized telephonic case management in the early months after a heart failure admission is greater than that usually achieved with pharmaceutical therapy and comparable with other disease management approaches.