Long-term acute care hospitals (LTCHs) are common sites of postacute care for patients recovering from severe respiratory failure requiring mechanical ventilation (MV). However, federal payment reform led to the closure of many LTCHs in the US, and it is unclear how closure of LTCHs may have affected upstream care patterns at short-stay hospitals and overall patient outcomes. To estimate the association between LTCH closures and short-stay hospital care patterns and patient outcomes. This retrospective, national, matched cohort study used difference-in-differences analysis to compare outcomes at short-stay hospitals reliant on LTCHs that closed during 2012 to 2018 with outcomes at control hospitals. Data were obtained from the Medicare Provider Analysis and Review File, 2011 to 2019. Participants included Medicare fee-for-service beneficiaries aged 66 years and older receiving MV for at least 96 hours in an intensive care unit (ie, patients at-risk for prolonged MV) and the subgroup also receiving a tracheostomy (ie, receiving prolonged MV). Data were analyzed from October 2022 to June 2023. Admission to closure-affected hospitals, defined as those discharging at least 60% of patients receiving a tracheostomy to LTCHs that subsequently closed, vs control hospitals. Upstream hospital care pattern outcomes were short-stay hospital do-not-resuscitate orders, palliative care delivery, tracheostomy placement, and discharge disposition. Patient outcomes included hospital length of stay, days alive and institution free within 90 days, spending per days alive within 90 days, and 90-day mortality. Between 2011 and 2019, 99 454 patients receiving MV for at least 96 hours at 1261 hospitals were discharged to 459 LTCHs; 84 LTCHs closed. Difference-in-differences analysis included 8404 patients (mean age, 76.2 [7.2] years; 4419 [52.6%] men) admitted to 45 closure-affected hospitals and 45 matched-control hospitals. LTCH closure was associated with decreased LTCH transfer rates (difference, -5.1 [95% CI -8.2 to -2.0] percentage points) and decreased spending-per-days-alive (difference, -$8701.58 [95% CI, -$13 323.56 to -$4079.60]). In the subgroup of patients receiving a tracheostomy, there was additionally an increase in do-not-resuscitate rates (difference, 10.3 [95% CI, 4.2 to 16.3] percentage points) and transfer to skilled nursing facilities (difference, 10.0 [95% CI, 4.2 to 15.8] percentage points). There was no significant association of closure with 90-day mortality. In this cohort study, LTCH closure was associated with changes in discharge patterns in patients receiving mechanical ventilation for at least 96 hours and advanced directive decisions in the subgroup receiving a tracheostomy, without change in mortality. Further studies are needed to understand how LTCH availability may be associated with other important outcomes, including functional outcomes and patient and family satisfaction.