This study assessed the validity of standardized assessment data collected with the Minimum Data Set (MDS) in postacute care settings and used to create performance indicators. Our results show that performance indicators derived from information collected with the MDS demonstrate convergent validity with data collected with other research or standardized assessment instruments. Results were most favorable for areas of physical functioning, cognitive and communicative functioning, and clinical complexity. Results were encouraging for affective functioning, but further research and development in this area is clearly needed. There is a pressing need for better quality data on performance measurement in the postacute environment, given the rapid growth in the volume of services and expenditures for such care and the associated need to ensure that patients receive the most appropriate care possible.