This article provides evidence of the effectiveness of family-based, community-oriented primary healthcare programs on the reduction of ambulatory care sensitive hospitalizations in Brazil. Between 1998 and 2002, expansions of the Family Health Program were associated with reductions in hospitalizations for diabetes mellitus and respiratory problems and Community Health Agents Program expansions were associated with reductions in circulatory conditions hospitalizations. Results were significant for only the female population only, suggesting that these programs were more effective in reaching women than men. Program coverage may have contributed to an estimated 126 000 fewer hospitalizations between 1999 and 2002, corresponding to potential savings of 63 million US dollars. © 2009 Wolters Kluwer Health.