Despite its importance, the objective impact of clinical peer review on the quality and safety of care has not been studied. Data from 296 acute care hospitals show that peer review program and related organizational factors can explain up to 18% of the variation in standardized measures of quality and patient safety. The majority of programs rely on an outmoded and dysfunctional process model. Adoption of best practices informed by the continuing study of peer review program effectiveness has the potential to significantly improve patient outcomes.