Increasingly, hospital restructuring is viewed with skepticism because of a lack of systematic and rigorous evaluation of its impact on quality of care. This first article in a two-part series describes comprehensive evaluation of the effects of hospital restructuring on patient satisfaction, nurse satisfaction, costs of care, and clinical quality on four medical-surgical units at a large tertiary hospital. In addition, early application of the model to critical care is described. A quasiexperimental pre- and post-design combined with concurrent control units for selected measures was the overall strategy. The authors conclude that comprehensive restructuring of hospital-based care can take place in a manner that preserves multiple dimensions of quality while decreasing costs. This only can be ascertained, however, through rigorous and systematic measurement and evaluation. Part 2 will detail application and evaluation of the restructuring model in the critical care environment.