The purpose of this study was to estimate the prevalence and cost of illness of asthma in Germany by retrospectively analysing routine health insurance data. This analysis investigated claims data from all insured persons of six large sickness funds. Insurants with asthma were identified via the International Classification of Diseases (ninth revision) diagnosis and the Anatomical Therapeutic Chemical Classification System Code for regular medication prescriptions. Costs for hospital care, medication and sick benefit were taken from claims data. Costs for rehabilitation, premature death and early retirement were estimated using the human capital approach and data from national statistics. Prevalence of asthma in the German statutory health insurance was 6.34%. Total costs for asthma, including direct and indirect costs, were calculated at euro 2.74 billion during 1999. The prevalence of asthma in the German statutory health insurance has previously been estimated to be 4-6%. The results of this large study show the prevalence of asthma in the German social insurance system to be approximately 6%. The study also indicates that there is room for substantial savings in the German social insurance system, with indirect costs amounting to 74.8% of total costs and payment of sick benefits through the sickness funds amounting to 58.3% of indirect costs. These costs may be reduced with better asthma control in patients.