Hay Joel W.; Osmond, Dennis H.; Jacobson, Mark A.Journal of Acquired Immune Deficiency Syndromes: October 1988 ORIGINAL ARTICLE: PDF Only Free Abstract We projected the direct medical costs of acquired immune deficiency syndrome (AIDS) and AIDS-related complex (ARC) for the United States during the period 1987–1991, by applying current epidemiologic projections to state-of-the-art medical decision algorithms for diagnosis and treatment of AIDS-related illnesses. We included the cost of azidothymidine (AZT) therapy, as well as other therapeutic innovations likely to be approved by the FDA, and estimated average ARC patient treatment costs. By combining prospective study data on rates of progression to AIDS with current AIDS incidence data, we arrived at human immunodeficiency virus (HIV) seropreva-lence and AIDS incidence projection that were considerably lower than those of the Public Health Service. We estimated the average total medical costs per patient for AIDS in the 1990s at $27,950-$40,455 and for ARC at $3,621-$4,913 per year (1987 U.S. dollars). We projected the medical costs of AIDS and ARC at $2–4 billion annually by 1991, substantially lower than previous estimates. We projected that Pneumocystis carinii pneumonia and other pulmonary complications would account for the largest share (over 40%) of AIDS medical costs, and that AZT therapy and medication would account for more than 25% of total ARC/AIDS treatment costs by 1991. In our estimates, the total medical costs of treating ARC patients could approach one-half of the costs of treating AIDS patients by 1991, primarily due to costs associated with AZT. © Lippincott-Raven Publishers.