INTRODUCTION: There are few proven strategies to reduce the frequency of potentially preventable hospitalizations and Emergency Department (ED) visits. To facilitate strategy development, we documented these events among complex patients and the factors that contribute to them in a large care-improvement initiative. METHODS: Observational study with retrospective audits and selective interviews by the patients' care managers among 12 diverse medical groups in California, Minnesota, Pennsylvania, and Washington that participated in an initiative to implement collaborative care for patients with both depression and either uncontrolled diabetes, uncontrolled hypertension, or both. We reviewed information about 373 adult patients with the required conditions who belonged to these medical groups and had experienced 389 hospitalizations or ED visits during the 12-month study period from March 30, 2014, through March 29, 2015. The main outcome measures were potentially preventable hospitalizations or ED visit events. RESULTS: Of the studied events, 28% were considered to be potentially preventable (39% of ED visits and 14% of hospitalizations) and 4.6% of patients had 40% of events. Only type of insurance coverage; patient lack of resources, caretakers, or understanding of care; and inability to access clinic care were more frequent in those with potentially preventable events. Neither disease control nor ambulatory care-sensitive conditions were associated with potentially preventable events. CONCLUSION: Among these complex patients, patient characteristics, disease control, and the presence of ambulatory care-sensitive conditions were not associated with likelihood of ED visits or hospital admissions, including those considered to be potentially preventable. The current focus on using ambulatory care-sensitive conditions as a proxy for potentially preventable events needs further evaluation.