Purpose: In the UK, intermediate care schemes have been implemented with short-term funding, targeted at reducing pressures on hospitals/nursing homes. Many have lacked a reliable evidence-base and there are few publications on one form of intermediate care, the community rehabilitation team (CRT). This study was conducted to establish whether one specific CRT should gain recurrent funding. Methods: This qualitative case study took a multi-method, multi-perspective approach. Data sources included: three focus groups and 40 semi-structured interviews with patients, carers and health services/local authority/CRT staff, document review, and field notes. The resulting data were analysed thematically. Results: The CRT was designed without sufficient reference to reliable evidence and consultation with local health/social services, and implemented against a background of cultural divides between and within these services. It was also hampered by an ambitious remit and premature attempts at outcome evaluation. Patients/carers were satisfied with interventions, functional gains and social aspects of input but there was no reliable evidence of cost-effectiveness. Conclusions: The study highlighted problems related to service implementation, which exposed flaws within current policy of providing short-term funding for schemes that must demonstrate cost-effectiveness quickly, in order to gain recurrent funding.