The author introduced strategies employed in his efforts to ensure the quality and continuity of care for psychiatric patients as they make the transition from the hospital to the community in Japan. The number of psychiatric beds per 10000 people in the medical service area of Asaka Hospital is about 40, which is much higher than the average of 28.7 for Japan. Decreasing the number of hospital beds by building up an appropriate support system in the community is the aim of the policies of Asaka Hospital. The key concept in managing health care is "quality assurance," which has three main components: structure, process, and outcome. Among the structured factors, the importance of a wide spectrum of care to support patients from the hospital to the community, the amenity of the hospital unit as a therapeutic milieu, and the information management system were stressed. The Optimal Treatment Project (OTP) was employed for improving quality and continuity of care. From studying OTP as a psychosocial approach, the knowledge and skill of the staff have improved dramatically. OTP as a common language made multidisciplinary teamwork more systematic and extremely consistent for the customer. Finally, an innovative project was introduced to help patients progress from hospital beds to a combination of residential care facilities and day and night care. This project aims eventually to close small hospitals.