OBJECTIVES: Osteoarthritis is a major debilitating disease afflicting approximately 20 million persons in the  United States.  Yet, the financial and societal  costs to patients, insurers, and society  from osteoarthritis remains poorly understood.  METHODS: Using data from the Medical Expenditure Panel Survey (MEPS) a large, nationally-representative database from the United States, this study performs bivariate and multivariate analyses to quantify the relationships between osteoarthritis and annual health care costs to patients, insurers, and society.  Individual and nationally-aggregated cost estimates will be provided.  RESULTS: Overall  annual health care costs are dramatically higher  in subjects with a diagnosis of osteoarthritis than in subjects without osteoarthritis ($10,803 vs $3,427, p <0.01).  This cost differential is particularly great among African-Americans  with osteoarthritis compared to African Americans without osteoarthritis ($13,937 vs $3,293, p <0.01)).  This reflects the high prevalence of osteoarthritis among Africa-Americans.  The total cost of osteoarthritis is dramatically and significantly lower (p <0.01) among uninsured subjects ($2,875) than among subjects with private insurance ($11,798) or private ($11,093) insurance. This suggests that uninsured subjects with osteoarthritis are facing serious health care access problems. Large differences in total costs from osteoarthritis persist when the sample is stratified by age, gender, educational attainment, insurance status, weight classification, and geographic location.   Out-of-pocket health care costs are much higher among subjects with osteoarthritis  ($1757 vs. $649, p <0.01) and are also higher for insurers ($9047 vs. $2279, p <0.01).  CONCLUSIONS: These findings indicate that the cost burden from osteoarthritis is quite large for all groups and falls disproportionately on African -Americans and uninsured individuals.