OBJECTIVES:  To estimate direct medical costs of atopic dermatitis (AD) from a US payer perspective.  METHODS: Data came from a large employer-based longitudinal claims database, which captures person-specific clinical utilization, expenditures, and enrollment across inpatient, outpatient, prescription drug, and carve-out services. A matched case-control study design was employed.  Cases were identified based on at least two AD-related medical claims with an International Classification of Disease v9 codes of 691.8x or 692.x anytime during the calendar year of 2009.  Three controls were matched to each case based on age, gender, type of health plan enrolled, and censes region.  Multivariate robust regression models were used to estimate the incremental burden of AD.  A non-parametric bootstrap technique with 1000 replications was used to estimate the distribution of the beta coefficients and derive the 95% confidence limits.  RESULTS: A total of 119,252 cases were matched to 357,756 controls with an average age of 46 years (SD=23.9), and 57% females.  AD-related comorbidities such as allergic rhinitis, asthma, other types of allergies, sleep disturbances and attention deficit disorders were significantly greater (p<0.01) in proportion among cases vs. controls.  After adjusting for all baseline differences, cases on an average had $912 (95% CL:$781-$1,042) greater overall cost per subject compared to controls.  Top three drivers were attributed to outpatient costs (58%, $533), inpatient costs (22%, $201), and pharmacy costs (15%, $139), respectively.  Among cases, dermatology-related overall costs were 370% (from $127 to $470) greater post index event.  Over 80% of this increase was attributable to dermatology-related outpatient costs.  Approximately, three additional dermatology-related outpatient visits were observed in the follow-up period compared to baseline. CONCLUSIONS: AD is costing the U.S. payer an additional $912 per-patient-per-year compared to subjects with no AD.  Future research should determine the impact of current treatment on the economic burden of this disease.