Patients in residential aged care facilities (RACF) are frequently admitted to hospital since the RACF often lack adequate medical resources. Different economic agents, whose missions and funding may conflict, provide care for RACF residents: residential facility, primary care physicians, and hospital. In this article, I estimate the economic impact of employing a mobile hospital team (MHT) in RACF, which modifies the relationship between these three agents by providing care directly in RACF. A national, patient level database on RACF from 2014 to 2017 is used to calculate RACF outcome indicators. I analyse the difference between RACFs, that use MHT for the first time during the period (treatment group), and those that did not use MHT at all in the same period using a difference in difference (DID) model. The MHT had a significant impact on health care quality in treated RACFs and reduced the number of patients transferred to hospital and the number of emergency department visits, and increased palliative care utilisation at the end-of-life, without increasing total hospital expenditure. MHT appear improve care quality in RACFs by filling the gap in care needs including better end of life care, without increasing health expenditure. Given the high number of hospital transfers especially towards the end of life, securing the right level and mix of social and medical resources in RACFs is essential. Transferring some competencies of MHT teams to residential facilities may improve the quality of life of residents while improving allocative efficiency of public resources. © 2022. The Author(s), under exclusive licence to Springer-Verlag GmbH Germany, part of Springer Nature.