Prior studies have typically examined only one of the dimensions of efficiency and uncompensated care at a time, providing a more limited view on decision making. We looked at both dimensions simultaneously. This study found that efficient hospitals tend to provide more uncompensated care over time. It may be because, as economic theory suggests, efficient hospitals may have more capacity to deliver greater amounts of care to the uninsured relative to less efficient hospitals. Specifically, by being more efficient, hospitals should have more available internal resources to support care of poor patients (Hadley et al., 1996; Newhouse, 1970).