The use of screening pneumograms for evaluation of apnea and bradycardia had been the practice in a large tertiary hospital for premature infants less than or equal to 34 weeks until October 1994. This practice often extended length of stay and cost for this patient population. In order to promote earlier discharge and still avoid risks of infant apnea, in Oct 1994, The Medical Center of Delaware's Infant Apnea Program began discharging all premature infants ≤ 34 weeks gestation on home apnea monitors. There were no screening pneumograms done, and infants were monitored until resolution of their apnea and bradycardia of prematurity. We examined the length of stay, demographic data, and readmission rates for apparent life-threatening events(ALTE) for the year prior to this change, and the first year of the modified policy. For the year prior to the change in policy (period 1) 226 premature infants were monitored (birth wt=1558±674gms, gestational age=30±4wks; mean±SD). From 10/ 94 -9/ 94 (period 2), 329 infants were monitored. (birth wt = 1637±629 gms, gest age 31±3 weeks; mean ±SD). There were no differences in birth weight or gestation age between the patients in period 1 and 2,(p >.05). The length of stay in period 1 was 32.9 days; in period 2 it decreased to 29.4 days (p<.05). The decrease in cost was 1151pt days X 900/day = $1,036,350, plus the elimination of physician fees (150,000). The duration of monitoring increased during period 2 (7.1±3.76 vs 8.6±1.3 months, p=.0003)The increase in monitoring cost $315,000, for a net savings of$871,350..There was no significant difference between the two time periods in number of admissions(Period 1=26 vs Period 2 = 23). There was no change in the incidence of SIDS in this group of premature infants between periods 1 and 2. This change in monitoring policy resulted in no increase in morbidity and mortality, and resulted in significant cost savings, while ensuring that earlier discharge did not increase the risk of infant apnea at home.