We analyzed hospital and physician charges for 99 consecutive patients who underwent implantable cardioverter-defibrillator (ICD) implantation at our institution. Eighteen patients received an epicardial lead system and 81 were scheduled to receive a nonthoracotomy lead system, the generator being implanted either abdominally (n = 62) or pectorally (n = 19). The epicardial group had a significantly longer convalescent stay (11.6 +/- 2.5 days; mean +/- SEM) than the abdominal nonthoracotomy group, analyzed by intention to treat (4.6 +/- 0.5 days) or by treatment received (3.8 +/- 0.2 days; p <0.0001). Postoperative stay for the pectoral group was shorter still (2.9 +/- 0.4 days; p <0.033). Total charges for the epicardial group were $99,081 +/- $25,094, significantly higher than those for any of the nonthoracotomy groups (p <0.017). Total charges for the pectoral group were $44,128 +/- $2,465, significantly less than those for the abdominal nonthoracotomy group, analyzed by intention to treat ($59,961 +/- $1,369; p <0.05) or by treatment received ($56,679 +/- $635; p <0.05). Cost reductions in the nonthoracotomy groups were primarily due to decreased in-hospital convalescence period, lower surgeon and anesthesiologist fees, and lower procedure-day hospital charges in the pectoral group. The use of ICDs with nonthoracotomy leads can result in significantly shorter in-hospital convalescence and a reduction in total implant-related charges of 40% to 55%. The use of pectorally implanted ICDs results in further reduction in hospital stay and further cost reduction of 22% to 26%. The trend toward shorter convalescent stay without postimplant testing is likely to reduce further the overall costs of ICD implantation.