Community-acquired pneumonia (CAP) in chronic obstructive pulmonary disease (COPD) often result in sudden and persistent reduction in health-related quality of life (HRQoL), which may be alleviated with palliative care. Among individuals with COPD, we aimed to investigate potential associations between HRQoL at admission with CAP and the risk of re-hospitalization and mortality and potential associations between specific HRQoL domains and CAP treatment outcomes. HRQoL was assessed at admission and the participants were grouped into tertiles based on the HRQoL utility index and specific domains. The results revealed that participants in the middle and highest tertiles of HRQoL had a lower 90-day re-hospitalization risk compared to those in the lowest tertile, whereas no differences in re-hospitalization risk were observed 30 and 180 days after discharge. Almost one in four had severe pain or discomfort at admission and the domain pain or discomfort emerged as a predictor of re-hospitalization. In addition, participants in the middle and highest tertiles had lower risk of 180-day mortality compared to those in the lowest, while no differences were observed in 30-day or 90-day mortality risk. An increased focus on in-hospital palliative care could alleviate the pain and discomfort reported by many participants with potential to reduce re-hospitalization rates.