Immunizing children could reduce influenza in the elderly. We compared pneumonia and influenza hospitalizations (P&I) and medically attended acute respiratory infections (MAARI) in the Medicare populations in 1 Tennessee and 3 Minnesota counties that immunized school children with live, attenuated influenza vaccine with 4 comparison counties. The P&I rate ratio (RR) of intervention county/comparison county in Tennessee in 2005-06 was 0.74 (95% CI 0.61 - 0.87 which was significantly lower than the previous 5 years. With low influenza activity in 2006-07, P&I RRs for both states were not lower than the pre-intervention years. MAARI RRs in both states did not differ from the pre-intervention periods. Immunizing children against influenza may reduce P&I for the elderly in seasons when influenza outbreaks are severe. Additional study is needed before immunizing children against influenza can be recommended for herd immunity.