The study aims to examine the outsourcing decisions for superior organization performance in Bahir Dar, Felege hiwot referral hospital in focus. The study was employed quantitative method, with judgmental sampling and survey questionnaires were sent to Felege Hiwot Referral Hospital in Bahir Dar. The study tests the relationships between outsourcing decisions and organization performance using multiple regressions based on 119 responses from Bahir Dar FHRH. there is strong positive relationship was found between independent and dependent variables, which is 0.677, 0.851, 0.891,and 0.613 with cost driven outsource, strategic driven outsource, quality driven outsource, and time driven outsource respectively at a significant value of p is less than 0.001. This implies that the more and well implemented cost driven outsource, strategic driven outsource, quality driven outsource, and time driven outsource the higher will be the organizational performance. R square is .878, as 87.8% of the variation in organizational performance can be explained by the independent variables. The remaining 12.2 % of the variance is explained by other variables not included in this study. The Adjusted R Square adjusts for a bias in as the number of variables increases which is having a value of 0.874. Beta values of cost driven outsource has a positive relationship with organization performance with a value of 0.096, β value (0.315) shows that there is a positive relationship between strategic driven outsource and organization performance, quality driven outsource has a beta coefficient of 0.518 has positive impact on organization performance, and the beta value (0.135) is positive significant relationship between time driven outsource and organization performance. These findings point out that FHRH has to give major emphasis for quality driven outsourcing, strategy driven outsourcing, time driven outsourcing and cost driven outsourcing factors affecting outsourcing decision of the study as they do significantly affect organization performance. The study provides hospital administrators and public managers with a list of prioritized factors for making rational informed decision about outsourcing decisions of services in the hospitals. The study has some limitations; this paper has focused only on FHRH. So, future researchers should extend the scope of this research at country or regional level for the whole referral hospitals with similar variable.