OBJECTIVES: The relationship between quality of care and cost is essential to all policy makers. The importance of this relationship is realized when policy makers face decisions about cost minimization and quality maximization during times of health care budget constraints and public scrutiny. The aim of this study is to explore the relationship between hospital costs and quality of care for acute myocardial infarction (AMI). METHODS: All AMI Hospital Discharge data for Edmonton, Alberta, Canada between fiscal years 2006 to 2009 are linked with the Management Information System from Alberta Health Services to obtain hospital costs. The well-defined population data allows hospital mortality to proxy AMI quality of care. This study uses regression modelling with increasing specifications as well as various robustness checks to ensure the accuracy of the results. The Model specifications include demographics, AMI risk adjustments, Hospital fixed effects, and year fixed effects. Hospital Costs are logarithmically transformed to ensure a normal distribution and an easier layman interpretation for decision makers. Semi-parametric regression removes the assumption of linearity to determine the true relationship between hospital cost and AMI quality. RESULTS:  Higher AMI quality is associated with a 39% increase in hospital costs after adjustments and controls. The semi-parametric regression shows a fairly linear relationship between cost and AMI quality. CONCLUSIONS: To our knowledge this is the first Canadian study on the cost-outcome tradeoff for AMI and it suggests that Canadian policy and decision makers should take caution during budget cuts and implementing cost containment programs. The results suggest that reducing AMI budgets may have a negative effect on the quality of AMI care patients receive. The linear relationship suggests that the return on the quality of AMI is consistent for each dollar invested with no economies of scale.