"Cholecystectomy" is one of the ten "case payment" diseases announced in the National Health Insurance. Thirty-five consecutive laparoscopic cholecystectomies (LC), performed during the period July 1993 to December 1994, were compared to 35 age- and sex-matched patients undergoing open cholecystectomies (OC) during the same period. The results revealed that there were no significant differences in insurance status, indications, or abnormal results of EKG and liver function tests. The mean operative time was 124 +/- 46 min for LC, and 86 +/- 27 min for OC (p < 0.001), while the mean hospital stay was 7.4 +/- 2.8 days for LC, and 11.7 +/- 6.6 days for OC (p < 0.001). There were fewer patients using analgesics postoperatively within 24 hours for LC than for OC. The percentage of patients returned to work (or normal activity) within one week was higher for LC than for OC, but the difference was not statistically significant. Bile leakage was found in two LC cases (5.71%), while another two (57.1%) had wound infection in OC. Cost analysis showed that the cost of the operation room was NT$18,503 higher for LC (NT$27,643 against NT$9,140). Hospital charges were, on average, NT$53,721 for LC and NT$51,560 for OC (P > 0.05). The higher cost of LC was offset by a reduced length of hospital stay, so the hospital charges in the cases of both procedures were similar. As experience increases, the cost of LC will become lower. Moreover, LC minimizes the discomfort of patients, and patients can return to work earlier. From the perspective of the healthcare system, Laparoscopic Cholecystectomy is a safe, cost-effective technology.