OBJECTIVES: Cervical degenerative disc disorders are increasingly common in adults. Patients refractory to conservative therapy require surgery for relief of pain. This micro-costing study sought to compare actual costs of index hospitalization versus DRG revenue for cervical disc arthroplasty (CDA) in order to explore the financial profit or loss of this emerging intervention for German hospitals. METHODS: As published data is scarce, detailed in-hospital resource utilization for 1-level or 2-level CDA was mainly based on information supplied by three experienced neurosurgeons from private and public German hospitals. Where available, these estimates were compared and calibrated with existing data. Unit costs collected from hospital accounting departments and information from German reference cost databases and the published literature were subsequently assigned to the resource use items for the calculation of actual hospital costs associated with CDA. RESULTS: Average total per-patient hospital costs were estimated at €5,930 for 1-level and €8,768 for 2-level arthroplasty. Most important cost drivers were the costs of materials & disposables required for the intervention (relative contribution to total hospital costs for 1-level CDA: 44%, for 2-level CDA: 58%), followed by hospital ward costs (27%, 18%), use of operating and recovery room (15%, 13%), OR-team (8%, 7%), and diagnostic examinations (6%, 4%). With current G-DRG payments for mono-segmental CDA (€6,620) and bi-segmental CDA (€9,815), German hospitals can achieve average earnings of €690 (1-level CDA) and of €1,047 (2-level CDA) when performing this emerging disc replacement technique. CONCLUSIONS: Our costing study indicates that 1- or 2-level CDA represents a feasible and financially sustainable surgical therapy for German hospitals. First evidence from the literature also tends to show that CDA is associated with additional long-term benefits in terms of reduced rates of disc reoperations compared to conventional anterior cervical discectomy and fusion.